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My grandpa insists his investment account is federally insured from loses and provides a guaranteed rate of return of 8%.

To me this sounds very Bernie Madoffy but I admit I don't know all the available financial products. I see something called a principal protected fund but that doesn't look to be federally insured.

He is also a veteran

What sort of product is he referring to?

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    There is no such product. This is a scam. If this existed, 90% of people's retirement savings would be in this. – Patrick87 Feb 4 '18 at 19:52
  • That is what I said too but I thought maybe it was something subsidized for veterans or something. But I agree with you. – Jackie Feb 4 '18 at 20:27
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    I suspect something is lost in translation. Perhaps the maximum return is 8%, and anything over that goes to the loss protection. If there was a guaranteed return of 8%, why would there need to be any protection against losses? – D Stanley Feb 4 '18 at 21:04
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    There are annuities that offer various levels of downside protection as well as profit caps in the 6-10 pct range but they are not federally insured. A stock paying 8% would be SIPC insured (U.S.) but not guaranteed. All of this is guesswork. The best thing to do is to get hold of his brokerage statement or prospectus. – Bob Baerker Feb 4 '18 at 22:10
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    He is probably invested in a fund that is guaranteed (not Federally, but by an insurer) to return at least the original amount at the end of some fixed period of years. There is no guarantee on the 8%, although it is not beyond the realm of possibility that it did grow 8% in the past few years. With a little luck you could do that with a 25/75 stock/zero coupon bond split. This is probably a legitimate (although maybe inferior) investment that your grandfather badly misunderstands. Whether a salesman helped him misunderstand, who knows? – Andrew Lazarus Feb 6 '18 at 0:14

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