Annunities

[Gigi3000]

I keep running into road blocks with getting annunity information directly from the insurance company. They keep referring me to an agent but I all ready have a CFP. I'm checking into a Single Premium Immediate Annunity and a MYGA. Has anyone found an insurance company you can buy these from directly?

[dewilson58]

barf

[retiredguy123]

I don't think you will be able to buy an annuity directly from an insurance company. I hate annuities and would never buy one. But, if I had to buy an annuity, I would buy it from Vanguard Investments. A second choice would be Fidelity Investments. I think both companies sell annuities. Good luck.

[NeilV1]

Annuities Through Fidelity | Compare Available Products | Fidelity (https://www.fidelity.com/annuities/compare-annuities)

[Babubhat]

Vanguard or Fidelity. Keep costs low

[Eg_cruz]

I keep running into road blocks with getting annunity information directly from the insurance company. They keep referring me to an agent but I all ready have a CFP. I'm checking into a Single Premium Immediate Annunity and a MYGA. Has anyone found an insurance company you can buy these from directly?
Not sure I would get a immediate annuity…….they just don’t pay. You can not pay an annuity without an agent.

[Stu from NYC]

And typically the salesman gets a rather sizable commission.

[Blueblaze]

The first problem with annuities is that you have to buy them from a salesman.

The worst problem with annuities is that when you do the math, you realize you're tying up your money for 10 years to get the same return you could get from a 3-year federally-insured CD. Don't be fooled by the fake "equivalent return" numbers they quote. The number to look at is the internal rate of return. It never even matches the inflation rate.

It's always been a mystery to me that no 100-year-old insurance company has the confidence in their investment team to write a contract that simply guarantees a reasonable fraction of historic stock market returns. They would clean up on the spread, and put the stock brokers out of business! Think of it -- they have the longevity to survive dips in the market (unlike us mere humans), they have the knowledge and experience to successfully play the market -- and they even get to keep what's left in your "account" when you die! So why aren't they willing to write a non-crooked contract that does something beyond just dribbling your own money back to you until you kick the bucket?

I guess the answer is they don't have to. There is an endless supply of marks who won't or can't do the math.

I would LOVE to buy an annuity and quit worrying about how to invest my money. So far, I've never found one that wasn't a scam.

[Carla B]

Thank You, Blueblaze, I think you uncovered the secret behind annuities.

[Stu from NYC]

Thank You, Blueblaze, I think you uncovered the secret behind annuities.

As the old saying goes, Annuities are never purchased they are sold.

[Gigi3000]

Yeah, I just came back to say that I don't see the benefit either, unless maybe if I live to 100. If I buy a $100000 immediate annunity, I'd get around $450 a month and if it pays me for 18 years, I'd just break even..sounds ludacris and I would prolly kick off in 3 years, my luck. Then I'd be reeeeaaaallly upset!!!! :)

[kkingston57]

Have annuities(variable) and get 5% guaranteed and rarely get more than 5%(last year was a good exception) Can not get this rate now. Watch out for the costs. They are more than most of the costs on mutual funds. Costly but safe investment.

Do not know they can be bought direct.

[richrjones]

I keep running into road blocks with getting annunity information directly from the insurance company. They keep referring me to an agent but I all ready have a CFP. I'm checking into a Single Premium Immediate Annunity and a MYGA. Has anyone found an insurance company you can buy these from directly?

Call a local agent for State Farm. They can help you.

[joeharing]

Buy stock in Dominion or Duke Energy and be done with all the hassles. Your heirs will thank you.

[rlcooper70]

Huge commissions with fixed annuity. If you want to use the variable annuity as a means to invest in mutual funds, call Fidelity they will lead you through the way to purchase.

[spinner1001]

I keep running into road blocks with getting annunity information directly from the insurance company. They keep referring me to an agent but I all ready have a CFP. I'm checking into a Single Premium Immediate Annunity and a MYGA. Has anyone found an insurance company you can buy these from directly?

Licensing may be the reason for your experience with the insurance company. Insurance ‘agents’ are licensed by a state’s insurance regulator (in Florida, the Division of Insurance
Agent and Agency Services) to talk with customers in a particular state. The people at the insurance company may not be licensed by the state of Florida to represent the company to customers.

[arbajeda]

Why aren't you talking to your CFP about this? That's why you're paying him.

[Eg_cruz]

The first problem with annuities is that you have to buy them from a salesman.

The worst problem with annuities is that when you do the math, you realize you're tying up your money for 10 years to get the same return you could get from a 3-year federally-insured CD. Don't be fooled by the fake "equivalent return" numbers they quote. The number to look at is the internal rate of return. It never even matches the inflation rate.

It's always been a mystery to me that no 100-year-old insurance company has the confidence in their investment team to write a contract that simply guarantees a reasonable fraction of historic stock market returns. They would clean up on the spread, and put the stock brokers out of business! Think of it -- they have the longevity to survive dips in the market (unlike us mere humans), they have the knowledge and experience to successfully play the market -- and they even get to keep what's left in your "account" when you die! So why aren't they willing to write a non-crooked contract that does something beyond just dribbling your own money back to you until you kick the bucket?

I guess the answer is they don't have to. There is an endless supply of marks who won't or can't do the math.

I would LOVE to buy an annuity and quit worrying about how to invest my money. So far, I've never found one that wasn't a scam.
You really don’t know what you speak of……

[noslices1]

I have one through N Y Life that pays 7.8%, but got that 5 years ago, so I don’t know what they pay now. It was an immediate pay annuity.

[Bridget Staunton]

I have Lincoln Financial oldest in the nation. Got it from my Financial Planner

[Eg_cruz]

Huge commissions with fixed annuity. If you want to use the variable annuity as a means to invest in mutual funds, call Fidelity they will lead you through the way to purchase.
Why would anyone buy a variable annuity to purchase mutual funds……..sorry that makes zero since. Variable annuities come with higher cost, you have M&E, administration, and fund manager fees wrapped in the annuity anywhere from 2-3%. Just go buy the MF. Having an annuity just to have funds is NOT what annuities are design for

[Eg_cruz]

I have one through N Y Life that pays 7.8%, but got that 5 years ago, so I don’t know what they pay now. It was an immediate pay annuity.
I like to see that ……I know NY Life and five yrs ago they were not paying 7% to the annuitant

[FredJacobs]

I keep running into road blocks with getting annunity information directly from the insurance company. They keep referring me to an agent but I all ready have a CFP. I'm checking into a Single Premium Immediate Annunity and a MYGA. Has anyone found an insurance company you can buy these from directly?

I retired after 20 years training and teaching insurance products. An annuity can ONLY be purchased from an insurance company, Yes, mutual fund companies sell annuities but it is through their insurance division.

An immediate annuity usually makes sense for someone with a longer life expectancy. However, the annuity may not die when you do. There are many options for receiving your distribution - your whole life, for a period certain - 10, 20, years etc., for your life and the life of beneficiary and many other options. Each option affects the amount of the monthly distribution. A life insurance agent can give you the amount of distribution for each option.

I would suggest that you deal with a major insurance company - Met Life, Prudential, AXA (formerly Equitable), etc.

[BlueHeronFan]

Annuities are not for everyone but we did get one from Wells Fargo Investments. It has a minimum return of 6% and so far has grown very well. At 72 we are to receive a large monthly check. It includes insurance to cover in the event of death etc. So far, we have been quite satisfied with it.

[Cranford61]

Thank You, Blueblaze, I think you uncovered the secret behind annuities.
Someone has to pay for those free seminar meals……..and YOU are the someone. Urp!

[pennysue1]

If you are a military, I would call USAA. The number is

(800) 531-8722

[Luggage]

There is a woman's Jewish charity group called Hadassah and has been around 100 plus years or so and they have an ad in their magazine of someone that sponsors and annuity program. They give you the rates in the ad and I would suggest calling them up I believe they're actually in New York Hadassah to get the information on the company. I believe it's four and a half percent if you're 65 and it goes somewhere to 9%, if you sign up at 85. Yes you are tying up your money and it's a charity so that maybe it's a little bit better than others but I've never checked into it further. Has everyone says salesman do make a big commission but you're an adult and you should not put all of your money into anyone basket ever

[retiredguy123]

Annuity salespeople will promise rates and will make all kinds of claims about what the annuity will do for you. But, ask them to provide a copy of the entire annuity contract so you can read the actual contract that you will sign. I have tried many times to get a copy of an annuity contract and they have always refused to provide it and have sometimes gotten nasty about it.

Also, sometimes the promised annuity rate of 6 or 7 percent does not mean that is the rate of return on your investment. It often means that they will pay you that rate, but some of the money will come from the principal that you invested. Of course, if they won't let you read the contract, you don't know how it is calculated.

[SacDQ]

Annuities are like being mugged while your car is being stolen.

[KRMACK55]

The first problem with annuities is that you have to buy them from a salesman.

The worst problem with annuities is that when you do the math, you realize you're tying up your money for 10 years to get the same return you could get from a 3-year federally-insured CD. Don't be fooled by the fake "equivalent return" numbers they quote. The number to look at is the internal rate of return. It never even matches the inflation rate.

It's always been a mystery to me that no 100-year-old insurance company has the confidence in their investment team to write a contract that simply guarantees a reasonable fraction of historic stock market returns. They would clean up on the spread, and put the stock brokers out of business! Think of it -- they have the longevity to survive dips in the market (unlike us mere humans), they have the knowledge and experience to successfully play the market -- and they even get to keep what's left in your "account" when you die! So why aren't they willing to write a non-crooked contract that does something beyond just dribbling your own money back to you until you kick the bucket?

I guess the answer is they don't have to. There is an endless supply of marks who won't or can't do the math.

I would LOVE to buy an annuity and quit worrying about how to invest my money. So far, I've never found one that wasn't a scam.
Thank you for stating it so clearly !
I did that as a young woman realized my error and got out !

[KRMACK55]

Annuities are like being mugged while your car is being stolen.
You just made my day

[rlsjks1987@gmail.com]

If you get a "guaranteed " monthly return and the initial investment grows minimally each year and the gross market value is left to your heirs- I am satisfied! (please, no snide or criticizing comments. I am retired, satisfied and don't need the hassle). Just my opinion.

[Packer Fan]

Annuities are like being mugged while your car is being stolen.

So send your social security check or any pensions you have back. They are annuities. This is just wrong. Annuities have a very important place in retirement planning when used correctly. The only product that can guarantee lifetime income. I have several and am VERY satisfied. I also have several million in the stock market. Totally different goals for each. When another 2008 happens, I will be fine because I have enough guaranteed income to cover my bills. How will you be doing? You can’t earn anything in bonds anymore, so annuities are actually pretty attractive as an alternative. Read or listen to anything by Dr Wade Pfau and you might change your mind.

[Stu from NYC]

So send your social security check or any pensions you have back. They are annuities. This is just wrong. Annuities have a very important place in retirement planning when used correctly. The only product that can guarantee lifetime income. I have several and am VERY satisfied. I also have several million in the stock market. Totally different goals for each. When another 2008 happens, I will be fine because I have enough guaranteed income to cover my bills. How will you be doing? You can’t earn anything in bonds anymore, so annuities are actually pretty attractive as an alternative. Read or listen to anything by Dr Wade Pfau and you might change your mind.

We have no choice about social security but if we could have opted out 50 years ago would have.

Annuities are very important to the people who sell them. How else can they live the life they have gotten accustomed too.

[annecobb]

Buy stock in Dominion or Duke Energy and be done with all the hassles. Your heirs will thank you.

Those are good stocks along with Carolina Power.

[zendog3]

I worked all my career for higher education. They shared a retirement program under TIAA-Cref. Early on, that was only available to people in higher ed. I put part of my retirement money into safer lower earning annuity and part into riskier mutual funds. Very glad I did as my income is now about what it was while I was working.

TIAA is not available to the public. It is a low cost investment fund with billions under management. It is worth investigating online.

[ProfZ]

Annuities are just one option among many available for retirement income streams. One shoe size doesn't fit all but it might just fit you if you are looking for guaranteed income, perhaps for life, in retirement. Today's annuities are multi-faceted - unlike a few years back when annuity options were extremely limited. A local annuity broker who specializes in annuity offerings, among other retirement financial vehicles, is Parady Financial. Why not give them a call and learn from the experts what is available, and at what cost, etc etc?

[Joe Sacco]

Yeah, I just came back to say that I don't see the benefit either, unless maybe if I live to 100. If I buy a $100000 immediate annunity, I'd get around $450 a month and if it pays me for 18 years, I'd just break even..sounds ludacris and I would prolly kick off in 3 years, my luck. Then I'd be reeeeaaaallly upset!!!! :)

There are places where annuities make sense. If your total portfolio risk can be lowered by annuitizing a portion (and your willing to accept the risk of croaking early) you can dial up your risk in the remainder of your portfolio and improve your returns. This also becomes a much easier premise if you don’t need to count on leaving a legacy. 😊

[dewilson58]

Essentially, you’re betting the insurance company that you’re going to live longer than they think you will. They take your money, invest it and give it back to you in dribs and drabs (with steep penalties if you want to withdraw more than the contract states).

Annuities are such terrible investments that the minute the government passed a law specifying that financial professionals had to act in their clients best interest, annuity sales fell off a cliff.

In 2016, new rules were passed by the Department of Labor that stated that brokers have to act as fiduciaries. That means they had to put their clients’ best interest ahead of their own.

Needless to say, there’s not a lot of incentive for him to put you in a low-cost index fund.

As soon as the fiduciary rule was passed in 2016, sales of annuities fell 8%. They slid an additional 18% in the first quarter of 2017.

Sales of variable annuities, which are the worst of the worst, crashed 22% in 2016.

:popcorn::popcorn::popcorn:

[Ralpro1]

Annuities are considered to be insurance products and therefore are sold by insurance agents of insurance companies. Fixed annuities are very simple, similar to bank CDs but with deferral of interest taxation.

[retiredguy123]

Annuities are just one option among many available for retirement income streams. One shoe size doesn't fit all but it might just fit you if you are looking for guaranteed income, perhaps for life, in retirement. Today's annuities are multi-faceted - unlike a few years back when annuity options were extremely limited. A local annuity broker who specializes in annuity offerings, among other retirement financial vehicles, is Parady Financial. Why not give them a call and learn from the experts what is available, and at what cost, etc etc?
I'm still waiting for Parady to call me back and provide a copy of one of their annuity contracts.

Who would agree to a contract that the other party won't provide a copy of before you agree to sign?

[Marlene36]

I keep running into road blocks with getting annunity information directly from the insurance company. They keep referring me to an agent but I all ready have a CFP. I'm checking into a Single Premium Immediate Annunity and a MYGA. Has anyone found an insurance company you can buy these from directly?
We HIGHLY RECOMMEND - Liz at TB Financial in Fruitland Park. EXCELLENT SERVICE AND TOP EXPERT in ALL ANNUITY PRODUCTS. We purchased our single premium annuities with her several years ago and are extremely pleased.
Call them for an appointment: (352) 350-1161 She also runs regular ANNUITY 101 SEMINARS on general info on the variety of annuities out there for you to pick from.

[Stu from NYC]

I'm still waiting for Parady to call me back and provide a copy of one of their annuity contracts.

Who would agree to a contract that the other party won't provide a copy of before you agree to sign?

He does have a wonderful rep of giving people the best annuity he possibly can that makes him a lot of money.

In other words he thinks we should all have an annuity.

[dewilson58]

We purchased our single premium annuities with her several years ago and are extremely pleased.

"extremely pleased" with what rate of return???

[Stu from NYC]

"extremely pleased" with what rate of return???

To some people the return does not matter but safety is all they care about.

That is how most annuities are sold.

[Carsonhempen1]

Catholic Holy Family Society (618)233-0286. A fraternal benefit society in Belleville IL. Buy annuity direct. NO commissions. Over 100 year old company

[Langwelld]

Whatever you do do NOT buy an annuity from VALIC.

[obx2003]

I don't think you will be able to buy an annuity directly from an insurance company. I hate annuities and would never buy one. But, if I had to buy an annuity, I would buy it from Vanguard Investments. A second choice would be Fidelity Investments. I think both companies sell annuities. Good luck.
This is the best advice if you must buy an annuity.

[obx2003]

Whatever you do do NOT buy an annuity from VALIC.

VALIC must be one of the worst insurance companies that does business in the USA. The fees they charged on a basic 403-B7 retirement account were felonious in the 1980's. Maybe they are better now? Unlikely.

[Packer Fan]

I got a copy of my annuity the day after I asked. It was like 150 pages long. I read the whole thing. I do contracts for a living, and I have to tell you, there was a lot in there that could be a bit confusing, but overall it was fine and said what I expected. I was specifically interested in the income gaurantees, and it was clearly stated how they worked. If they won't give you the contract, don't sign up.

[Packer Fan]

Essentially, you’re betting the insurance company that you’re going to live longer than they think you will. They take your money, invest it and give it back to you in dribs and drabs (with steep penalties if you want to withdraw more than the contract states).

Annuities are such terrible investments that the minute the government passed a law specifying that financial professionals had to act in their clients best interest, annuity sales fell off a cliff.


:popcorn::popcorn::popcorn:


That is totally incorrect. You are not betting anything with the insurance company. This is like saying you are betting the insurance company you won't crash when you buy car insurance. Annuities are based on life expectancy averages. If anything you are bettting all the other people buying the same annuity contract that you will live longer than the AVERAGE life expectancy. They are called mortality credits... the people who die early pay for the people who die later. Basically the opposite of life insurance.

Basically - they are longevity insurance, and insurance costs money. They are NOT investments. So you are wrong twice.

There are horrible mutual funds out there but you don't condemn all mutual funds do you? Why would you condemn a tool that helps a lot of people because there are a few bad ones, and a lot of bad sales people? Just stupid.

On top of it, having gauranteed income makes you happier and live longer - and here is my reference, unlike your unsubstantiated claims.

Retirees with a Guaranteed Income Are Happier, Live Longer | Kiplinger (https://www.kiplinger.com/retirement/annuities/601986/retirees-with-a-guaranteed-income-are-happier-live-longer)

Annuities can be part of a solid retirement plan, people should take an unbiased look - and I have never sold one, I just own a few as part of mine, and happy I do.

[retiredguy123]

I got a copy of my annuity the day after I asked. It was like 150 pages long. I read the whole thing. I do contracts for a living, and I have to tell you, there was a lot in there that could be a bit confusing, but overall it was fine and said what I expected. I was specifically interested in the income gaurantees, and it was clearly stated how they worked. If they won't give you the contract, don't sign up.
Did you get the annuity contract before or after you provided the money? I have discussed annuities in great detail with several annuity salespeople, and every one of them told me that they will not allow a potential customer to read the contract until after they have invested in it. You pay the money first, then you get the contract to sign, and then you have 30 days to cancel the contract and request a refund. When I have told them that I would like to review the contract to advise a friend before investing, they get angry, and will not discuss anything further. I could never recommend that someone transfer a large amount of money into an investment contract without being able to review the contract in advance. I am just curious if that is the way you purchased an annuity or was the process different.

[Ken D.]

Why aren't you talking to your CFP about this? That's why you're paying him.
Thanks for stating my exact thoughts. What did you CFP tell you to do?

[daniel200]

I think everyone knows that a CD is a type of contract issued by banks or brokers. An annuity is a type of contract with an insurance companies. Both are regulated. Annuities are regulated by the state insurance commissioner in each state.

There are many flavors of annuities. One types is very similar to a certificate of deposit (CD). This is called a Multiyear Guaranteed Annuity or MYGA. I think this type is a valid consideration as a CD replacement.

Key points:
CD's are backed by the FDIC up to $250k per person per account.
MYGA's are not backed by the FDIC. Since annuities are regulated by the states, MYGA's are backed by the "State Guarantee Fund" of each state. In Florida, this guarantee is $250,000 per person per account. The Guarantee Fund is funded (this is a legal requirement) by the insurance companies registered to do business in Florida.

A MYGA is a type of fixed annuity that provides a pre-determined and contractually guaranteed interest rate for a specified period of time, most commonly 3-10 years.

It's easiest to understand if I give an example:

Fidelity is currently offering a 5 year MYGA from Massachusetts Mutual Life that pays 1.9%. During the 5 years your interest accrues tax deferred. Taxes on interest are not due until you withdraw your money.

At the end of 5 years you are entitled to withdraw the entire principle plus interest in one lump some. You will owe taxes on the accrued interest at this time.

There are steep penalties if you withdraw money sooner than 5 years. If you do not want to take a lump sum at the end of the period (5 years in this case) you are allowed to roll it over (with taxes on accrued interest continuing to be deferred) in another annuity.

Massachusetts Mutual is rated A++ by AMBest. Companies rated A++ have had less than a 0.1% default rate in the last 20 years in the USA. And when there has been defaults, in almost all cases the state guarantee funds have been able to cover the amount guaranteed (usually 250k per state)

So this Massachusetts annuity offered by Fidelity is quite similar to a CD.
1) You can purchase this with a maturity of 3 to 10 years.
2) The interest rate is fixed at 1.9% for the period of 5 years for this annuity contract.
3) At the end of the contract, you are able to receive a lump sum payment of the original principal + accrued interest.
4) Your principle is backed up to $250k by Florida's Guarantee Fund
5) The interest rate you receive is exactly as stated. The agent who sells the annuity to you is making a hefty fee (usually 1 to 2%), but that fee is already calculated into the agreed upon interest rate. So there are no surprises.
6) You can buy these for your IRA, Roth or personal account.

Some difference from CD's
1) Interest grows tax deferred until you receive it at the end of the contract
2) It is not backed by the FDIC
3) Typically, this type of annuity pays a higher interest than CD's (arguably because the State Guarantee Backing is not as strong as the FDIC)
4) There are age restrictions ... This particular annuity will only be sold to you if you are under 85 years.

I'm in no way pushing this type of annuity. But they do offer a better interest rate than you can currently earn on CD's. It's important to understand that the default rate is much much higher as you move from A++ to B++ rated insurance companies. The 250k state backing is very good ... but it's not the FDIC

And I personally would not touch annuities tied to stock indexes. And I have no interest in "annuitizing" the return (receiving payments for life) in this low rate environment. For that reason I like the lump sum payment at the end of the contract.

[algi45]

I keep running into road blocks with getting annunity information directly from the insurance company. They keep referring me to an agent but I all ready have a CFP. I'm checking into a Single Premium Immediate Annunity and a MYGA. Has anyone found an insurance company you can buy these from directly?

USAA if you are eligible to join. Check on the requirements.

[Dan2020]

This week Vanguard announced its exit from selling annuities to consumers. The shift encompasses both variable annuities and income annuities. The variable annuities were offered by Transamerica. The income annuities (immediate and deferred income) were underwritten by a handful of insurers and offered on a third party platform.

[LateBoomer]

there are way too many types, and volume of, annuities to make a lot of generalizations. Fortunately we have our own Financial Planner who has been able to set us up with a couple of very good ones over the years.

[Eg_cruz]

Annuity salespeople will promise rates and will make all kinds of claims about what the annuity will do for you. But, ask them to provide a copy of the entire annuity contract so you can read the actual contract that you will sign. I have tried many times to get a copy of an annuity contract and they have always refused to provide it and have sometimes gotten nasty about it.

Also, sometimes the promised annuity rate of 6 or 7 percent does not mean that is the rate of return on your investment. It often means that they will pay you that rate, but some of the money will come from the principal that you invested. Of course, if they won't let you read the contract, you don't know how it is calculated.
You are asking the wrong agent then.

[Eg_cruz]

Did you get the annuity contract before or after you provided the money? I have discussed annuities in great detail with several annuity salespeople, and every one of them told me that they will not allow a potential customer to read the contract until after they have invested in it. You pay the money first, then you get the contract to sign, and then you have 30 days to cancel the contract and request a refund. When I have told them that I would like to review the contract to advise a friend before investing, they get angry, and will not discuss anything further. I could never recommend that someone transfer a large amount of money into an investment contract without being able to review the contract in advance. I am just curious if that is the way you purchased an annuity or was the process different.
That is simply not true. You can get a sample policy from any company……..I think you have been dealing with the wrong agents for sure

[Eg_cruz]

We have no choice about social security but if we could have opted out 50 years ago would have.

Annuities are very important to the people who sell them. How else can they live the life they have gotten accustomed too.
Wow…….

[Eg_cruz]

"extremely pleased" with what rate of return???
There is no rated of a return in a SPIA…….I don’t agree with you about annuities other then Variable and SPIA are not the best. With as low as interest rates are there is no reason to do a SPIA just but the funds in bank and your funds will last the same

[noslices1]

I like to see that ……I know NY Life and five yrs ago they were not paying 7% to the annuitant

Apparently you don’t know them that well. This is a lifetime annuity with a ten year guarantee, so if I die within ten years, they will only have to pay what would have been paid up to ten years, but I’ll break even at 15.5 years and get all my money back. I’m 77 now, so hopefully I’ll get past that point.(My mother died at 94 and my dad at 101). Fixed payment is actually 7.98% payout per year. It is only 4 years old.

[retiredguy123]

That is simply not true. You can get a sample policy from any company……..I think you have been dealing with the wrong agents for sure
Everything I said is true. I don't know what you mean by a "sample policy", but every annuity salesperson I have talked with (at least 5, including 2 locally) has refused to provide an actual annuity contract. They will gladly send you plenty of brochures, DVDs, and literature explaining how great the annuity is, but they will not provide the contract that you will need to sign. I understand that some annuity contracts are more than 150 pages long, but it would be easy to email an electronic copy or post it online.

[Pballer]

You should look at the web site Immediate Annuities - Income Annuity Quote Calculator - ImmediateAnnuities.com (http://www.immediateannuities.com). You can compare payouts under various scenarios (ex. joint life, single life) there as well as getting quotes from several insurance companies, and purchasing one through their web site. SPIAs are not the high commission, high fee variable annuity products that people rightly complain about. SPIAs help insure that you will not outlive your money, though importantly they do not protect you from inflation. I would wait until the Fed raises interest rates to purchase one because the payout rates are very low now.

[Mrprez]

I found a cure for my insomnia, I keep my annuity contract on my night stand. 5 minutes with that and I am sound asleep.;-)

[butlerism]

Will not be possible.

You park your money with a casualty company.

They use our money to collect interest and cover losses while preserving our capital, that is how they do business.

You are trying to buy a set of Golf Clubs at a Fish market.

Do some more research!

A broker is best you will get

[Ghat724@gmail.com]

I have annuity plans with both USAA and NSS Life. I prefer NSS Life, a fraternal association.
What most people do not understand and brokers are not quick to point out is that you never have to annunitize. That means one can continue to grow the money in the annunity account and then take the whole amount out ----never signing an annunity contract that gives up control of your money for a lifetime monthy payment. One has to live a very long time to be ahead. Of course if you die early, the insurance company wins! I would never sign an annunity contract, but would use an annunity account to accumulate wealth and I decide how to use it and who to leave it to when I die. I am not a broker or sales person. NSS Life has a plan that for money one can put away for 8 years they will give 3.5% interest with no fees. Only $1,000 to open an account, put in as much additional money as one wants without increasing the lockup time. I would be pleased to give one more information about NSS Life. Call Mike at: (412) 996-0222

[Heyitsrick]

For the people here saying "you can't get a contract before you buy", you couldn't be more wrong. Why would anyone buy a contractual product - which is what annuities are - without actually reading the contract? That's absurd. Now, does that mean there aren't unscrupulous annuity sellers out there? No. But annuities are contracts. Never, ever buy an annuity where you don't know what the contract guarantees.

I would easily and enthusiastically recommend anyone interested in the good, the bad and the ugly about annuities (and how they are often marketed) visit the "Stan The Annuity Man" website. This guy's motto is simple: ONLY purchase an annuity for what it contractually WILL DO, not what it MIGHT DO. There are other things to consider as to whether you actually need or should get an annuity, but insofar as what some sleazy salespeople might say, forget about what's "possible" with annuities. They are contracts. You're ONLY concerned with what is contractually guaranteed to you...period.

Stan The Annuity Man(R) | Brutally Honest Facts About Annuities (https://theannuityman.com) is Stan's site.

He's got a ton of YouTube videos on all manner of annuities. He welcomes anyone who wants to challenge him (including you) on the value of annuities. So go ahead...challenge him. But in the meantime, get informed.

And guess what? He'd be the first person to advise you NOT to get an annuity if you didn't need one to contractually one of four possible needs: Principal Protection, Lifetime Income, Legacy and Long Term Care. That's his "PILL" acronym.

Annuities are NOT investments. They are NOT growth vehicles. They ARE a transfer of risk. If what you have are just stocks and bonds, you have assets. What happens with assets? People are afraid to sell them. People die with assets. Annuities are an income stream. The income comes every month. What do people do with an income stream? They spend it! Why? Because the same income is coming again next month. It's really that simple. "But...but...my stock portfolio has gained a ton this past year!" OK, are you cashing it in to actually -- wait for it -- enjoy it?

Watch this one video of Stan's about how to choose an annuity. Tell me after watching it that all he cares about is you buying annuities. You'd be lying if you did. In this one video (of many), he warns about sleaze ball sales people, he warns about people telling you what annuities "might do" vs. "contractually will do", he tells you that you may not even need an annuity, and he also tells you that there's absolutely still a need to have stocks/bonds and other traditional investments in your portfolio. Sound like someone who just wants you to spend all your money on annuities? Hardly.

Just watch... https://www.youtube.com/watch?v=kMNFogvzQjw

[Stu from NYC]

Personally think one is much better off buying several different types of no load mutual funds and adding as you go.

Long term performance yields gains of 8-10% much better than annuity. Of course one must keep an emergency fund to tied yourself over in case of a market correction.

[retiredguy123]

[QUOTE=Heyitsrick;1995567]For the people here saying "you can't get a contract before you buy", you couldn't be more wrong. Why would anyone buy a contractual product - which is what annuities are - without actually reading the contract? That's absurd. Now, does that mean there aren't unscrupulous annuity sellers out there? No. But annuities are contracts. Never, ever buy an annuity where you don't know what the contract guarantees.

I agree that you should read a contract before signing it, but I don't know where to get one. A few friends have asked me for advice about specific annuities they were considering, but when I asked the companies for a copy of the contract, they refused to provide it.

I sent a message to Stan asking for a copy of an annuity contract to read. I hope he sends it to me.

[golden]

I keep running into road blocks with getting annunity information directly from the insurance company. They keep referring me to an agent but I all ready have a CFP. I'm checking into a Single Premium Immediate Annunity and a MYGA. Has anyone found an insurance company you can buy these from directly?

If Gigi3000 is miffed that he can't buy an annuity directly from an insurance company, try buying a new Chevy as it rolls off an assembly line. Autos and annuities are products and products generally have a channel of distribution. I don't know what Gigi3000 did for a living, but I assume it required some level of expertise for which he got paid. Folks who have expertise in products are called salesmen and they get paid via something dubbed a commission. Others who have expertise (lawyers, doctors) get paid by something called a fee. CFPs can get paid by either or both.

For those who have trashed annuities on this site, I would mention that annuities offer features that are important to seniors---death benefits, avoidance of probate, and the option to pay tax on gains when they choose.

Commissions are paid to the seller of an annuity. A purchaser should ask about the total costs of an annuity, which include commissions and expenses. It is not an unfair question to ask the seller how much he is being paid for the sale. A purchaser would be prudent to consider investing in an annuity with lower total costs.

Apparently, Gigi3000 has already picked out his products of preference. Those products he selected lock in an interest rate at current levels. Forty years ago interest rates were 16% and it generally takes 40 years for bond yields to completely cycle. So, Gigi3000 should understand that he is locking in a fixed interest rate at the bottom of the cycle.

Finally, it appears that Gigi3000 has a problem either proofreading or spelling the words annuity and the word already. Thus, it would probably behoove Gigi3000 not to buy anything directly and to seek as much advice as he can from either a commissioned or fee-based professional. But, if Gigi3000 is intent on not paying money for someone's expertise, I would be willing to perform his appendectomy in my garage.

[sail33or]

To all the folks that say what return they are getting:

They are paying you these returns with your "OWN" money you just gave them.

So theoretically I can give you any return you like up to the point "YOUR" money and its real return runs out.

Of course there are zillions of types and all complicated but it is no longer your money when you "BUY" an annuity.

BUY EXXON (pays huge dividend, always has) and quit worrying. Let them talk electric all they want, in your lifetime it takes more oil to manufacture, deliver and charge electric cars. As long as Jet Airplanes fly, Exxon will be paying dividends.

[Packer Fan]

Did you get the annuity contract before or after you provided the money? I have discussed annuities in great detail with several annuity salespeople, and every one of them told me that they will not allow a potential customer to read the contract until after they have invested in it. You pay the money first, then you get the contract to sign, and then you have 30 days to cancel the contract and request a refund. When I have told them that I would like to review the contract to advise a friend before investing, they get angry, and will not discuss anything further. I could never recommend that someone transfer a large amount of money into an investment contract without being able to review the contract in advance. I am just curious if that is the way you purchased an annuity or was the process different.
I got it before. I would never invest without the contract. Lincoln investments was the company. It’s a boilerplate contract. I would run from anyone who would not provide it. There is a trust issue there.

[joelfmi]

Vanguard annuity's is the best I have one for 25 Years and have made a lot of money.

[golden]

Hey Sail-

In 2018, my Dad did what you recommend and took his life savings, bought Exxon because it paid a 5% dividend, and then he quit worrying.

My Dad died in 2020. He paid $90/share in 2018 and the executor sold it for $30/share in 2020.

You're right--my Dad never worried, even now. I'm a little ticked off, however.

[Aces4]

If Gigi3000 is miffed that he can't buy an annuity directly from an insurance company, try buying a new Chevy as it rolls off an assembly line. Autos and annuities are products and products generally have a channel of distribution. I don't know what Gigi3000 did for a living, but I assume it required some level of expertise for which he got paid. Folks who have expertise in products are called salesmen and they get paid via something dubbed a commission. Others who have expertise (lawyers, doctors) get paid by something called a fee. CFPs can get paid by either or both.

For those who have trashed annuities on this site, I would mention that annuities offer features that are important to seniors---death benefits, avoidance of probate, and the option to pay tax on gains when they choose.

Commissions are paid to the seller of an annuity. A purchaser should ask about the total costs of an annuity, which include commissions and expenses. It is not an unfair question to ask the seller how much he is being paid for the sale. A purchaser would be prudent to consider investing in an annuity with lower total costs.

Apparently, Gigi3000 has already picked out his products of preference. Those products he selected lock in an interest rate at current levels. Forty years ago interest rates were 16% and it generally takes 40 years for bond yields to completely cycle. So, Gigi3000 should understand that he is locking in a fixed interest rate at the bottom of the cycle.

Finally, it appears that Gigi3000 has a problem either proofreading or spelling the words annuity and the word already. Thus, it would probably behoove Gigi3000 not to buy anything directly and to seek as much advice as he can from either a commissioned or fee-based professional. But, if Gigi3000 is intent on not paying money for someone's expertise, I would be willing to perform his appendectomy in my garage.


I have questions. Are annuities FDIC insured? If people stop purchasing them would the annuity company collapse from underfunding and would the current annuity holders take a bath? How does that work? (I know I could perform an internet search but it sounds as though we have many experts here regarding annuities and it appears annuity companies themselves can be very vague.)

[Mrprez]

To all the folks that say what return they are getting:

They are paying you these returns with your "OWN" money you just gave them.

So theoretically I can give you any return you like up to the point "YOUR" money and its real return runs out.

Of course there are zillions of types and all complicated but it is no longer your money when you "BUY" an annuity.

BUY EXXON (pays huge dividend, always has) and quit worrying. Let them talk electric all they want, in your lifetime it takes more oil to manufacture, deliver and charge electric cars. As long as Jet Airplanes fly, Exxon will be paying dividends.

Really? I started an annuity with an inherited annuity from my mother when she passed away. It was for $113,000. On the advice of my broker, we rolled that over into an LFG variable annuity with income for life as well as a life insurance policy to pay out to my wife in the event of my death.

I have received ~48 months of payments to the total of ~$26,000. So, by your reasoning, I should have a balance of $87,000, right? Please explain to me why my balance is now $111,000? Also, YTD return is 8.5%. Since the date of inception, the rate of return is around 5.5%. The minimum percentage is 4%.

Now, I understand that they are paying me with the return on the investments, but I don’t care if they make money as well. If they didn’t, there would be no annuities.

[golden]

Dear Aces4:

Annuities are NOT FDIC insured. They are insured by the state in which the insurance company is domiciled. In the few instances that I am aware of, the assets of the insurance company that folded were purchased by another insurance company so there was no losses to policyholders. This has allowed the insurance company to say that no one has lost money in an annuity. I would caution, however, that if we have a total collapse in our economy, there is not enough money in any state's insurance fund to cover the losses of multiple insurance companies. Ditto, FDIC.

Generally, there are two types of annuities--fixed in variable. With variable, which are basically tax-deferred mutual funds, you direct where your assets are invested and it is segregated from the insurance company's assets. In fixed annuities, the insurance takes your money and co-mingles it with everyone else's $ and makes the investments for you. If those investments go sour and the company folds, see the first paragraph.

Underfunding is not an issue, in my opinion.

[golden]

I have questions. Are annuities FDIC insured? If people stop purchasing them would the annuity company collapse from underfunding and would the current annuity holders take a bath? How does that work? (I know I could perform an internet search but it sounds as though we have many experts here regarding annuities and it appears annuity companies themselves can be very vague.)

Dear Aces4-

When you give money to an insurance company, whether it be for a fixed annuity, immediate annuity, or to simply pay an insurance premium, that insurance company does not keep your money in an FDIC insured checking account, but invests it. Their three main investments are stocks, bonds, and real estate. So, if you are concerned about the financial health of the insurance industry, since each of these assets have performed above historical norms for several years, presently I would not be too concerned.

Currently, interest rates that insurance companies are offering are in the low- to- mid single digits. The three asset classes of stocks, bonds, and real estate have done much, much better than that for several years. The difference between what they promised to pay you and what they earned on your money can be substantial and is their profit.

You can invest in these asset classes directly, but you may lose money. So, simply put, an annuity investor is sacrificing decent gains for insurance company guarantees. Some call that peace of mind.

[Aces4]

Dear Aces4:

Annuities are NOT FDIC insured. They are insured by the state in which the insurance company is domiciled. In the few instances that I am aware of, the assets of the insurance company that folded were purchased by another insurance company so there was no losses to policyholders. This has allowed the insurance company to say that no one has lost money in an annuity. I would caution, however, that if we have a total collapse in our economy, there is not enough money in any state's insurance fund to cover the losses of multiple insurance companies. Ditto, FDIC.

Generally, there are two types of annuities--fixed in variable. With variable, which are basically tax-deferred mutual funds, you direct where your assets are invested and it is segregated from the insurance company's assets. In fixed annuities, the insurance takes your money and co-mingles it with everyone else's $ and makes the investments for you. If those investments go sour and the company folds, see the first paragraph.

Underfunding is not an issue, in my opinion.


Thank you for that succinct explanation. The difference between the federal government and the state insuring money is that one can print the money to cover the losses. History has proven that to be true.

[Villageswimmer]

I got it before. I would never invest without the contract. Lincoln investments was the company. It’s a boilerplate contract. I would run from anyone who would not provide it. There is a trust issue there.

Google Lincoln Financial Investment reviews.

[manaboutown]

I wonder if the Edward Jones brokers who own the house that sold for $1.041M in 2006 on Russell Loop and are having it torn down to build a two story mansion on the lake view site sell many annuities to their customers?

[golden]

Thank you for that succinct explanation. The difference between the federal government and the state insuring money is that one can print the money to cover the losses. History has proven that to be true.

Dear Aces4-

You are correct that the Feds can print money and the states cannot.

As I mentioned, in the event of a total financial collapse. since insurance companies invest in stocks, bonds, and real estate, none of those assets are likely to go to zero and those holding annuities will receive some money back.

In the case of FDIC with multiple banks going under, the Feds can "bail out" depositors by printing worthless currency. It has been suggested, however, that the more likely scenario is a "buy in" whereby depositors are given stock in the bank that went under.

[Aces4]

Dear Aces4-

You are correct that the Feds can print money and the states cannot.

As I mentioned, in the event of a total financial collapse. since insurance companies invest in stocks, bonds, and real estate, none of those assets are likely to go to zero and those holding annuities will receive some money back.

In the case of FDIC with multiple banks going under, the Feds can "bail out" depositors by printing worthless currency. It has been suggested, however, that the more likely scenario is a "buy in" whereby depositors are given stock in the bank that went under.

True, the Feds could do that but it hasn’t happened in the recent past financial debacles.

[kathyspear]

I wonder if the Edward Jones brokers who own the house that sold for $1.041M in 2006 on Russell Loop and are having it torn down to build a two story mansion on the lake view site sell many annuities to their customers?

FWIW: The headline to the article on that rag news site is misleading if not a downright lie. She did not demolish the home. She removed the existing garage and roof so a second floor could be added.

kathy

[Ken D.]

We HIGHLY RECOMMEND - Liz at TB Financial in Fruitland Park. EXCELLENT SERVICE AND TOP EXPERT in ALL ANNUITY PRODUCTS. We purchased our single premium annuities with her several years ago and are extremely pleased.
Call them for an appointment: (352) 350-1161 She also runs regular ANNUITY 101 SEMINARS on general info on the variety of annuities out there for you to pick from.

So, what did it cost you, no beating around the bush.

[Gigi3000]

Annuity salespeople will promise rates and will make all kinds of claims about what the annuity will do for you. But, ask them to provide a copy of the entire annuity contract so you can read the actual contract that you will sign. I have tried many times to get a copy of an annuity contract and they have always refused to provide it and have sometimes gotten nasty about it.

Also, sometimes the promised annuity rate of 6 or 7 percent does not mean that is the rate of return on your investment. It often means that they will pay you that rate, but some of the money will come from the principal that you invested. Of course, if they won't let you read the contract, you don't know how it is calculated.

The bank agent said I couldn't have a copy of the contract before signing but I do have a right of rescission of at least 10 days after signing. However still taking it lump sum.

[Stu from NYC]

The bank agent said I couldn't have a copy of the contract before signing but I do have a right of rescission of at least 10 days after signing. However still taking it lump sum.

Why in the world would anyone in their right mind go ahead with a contract they are not allowed to read before execution?

[retiredguy123]

Why in the world would anyone in their right mind go ahead with a contract they are not allowed to read before execution?
I totally agree.