Guaranteed Equity Index Annuity
In seminars for the elderly the presenters recommend to put all of our assets in a 'Guaranteed Equity Index Annuity' by Allianz, telling us that the principal is safe and guaranteed forever PLUS if the market is gaining, one will increase one's principal.
I would appreciate anyone's opinion, sharing perhaps experiences with such retirement investment tool. So far I was unable to find objective literatur on this subject.
Thank you in advance.
With friendly regards, E.
I agree with Annuity Owner
Annuties are a huge part of what I offer because they SAVE client's money. My clients do not pay me, the company does. So compared to a Mutual Fund that I can offer, where I get 1% or more every year right out of my clients pocket whether there account is up or down, I choose Index Annuities for Safe-Money clients.
Bottom line is advisors have families to feed and get paid for their work. As we should. But to try to disguise the fact that you are getting paid using 'fee-based' is insulting.
Allianz are especially bad
I agree that not all annuities are bad deals, however, Allianz sells some of the worst. The products lock up money for a long time and they limit the gains from market returns by using "caps". You can do much better by putting most of your money into a guaranteed account and a small portion into either "no-load" mutual funds or ETF's (electronic traded funds). The expense fee for a no-load fund is around .50% per year (Vanguard) and the ETF's is .07%. By using this technique you are cutting out the middle-man. Basically, if you are taking the risk in the stock market you should enjoy all of the returns.
Not all annuities annuities are bad.
Asking the question "are annuities a good thing" will bring answers from experts from both sides of the field of "Yes" or "No" as you are seeing now. Whether you're a financial planner, estate planner, or insurance agent, your answer should never be a simple yes or no based on what you like to sell or what the commissions are. Really your answer on whether an annuity or index annuity is a good thing is, "It depends on your situation and current setting in your own financial world." There are a lot of people of various ages that have benefited from annuities/index annuities. Just make sure you find an advisor that fully examines your needs and suitibility before advising a product. Atlanta Tax Expert, you might want to think before responding to a client, Never buy them, they are horrible or what you need is a TIAA-CREF or Vanguard without knowing what you are working with, now that is a product pusher so don't throw rocks when you live in a glass house.
Just find yourself a trusted advisor that your feel does a suitable product needs anylisis with you before ever MENTIONING a company or product. Get a 2nd opinion and then make your judgement. There will always be a trade off in what you are putting your money in so make sure to compare all the trade offs before making a decision.
Suze Orman on index annuities
HI,
I'm in the same boat, wondering about the value, specifically to me, of an index annuity. If so, what index and what company. So far, the only ones I know about are S&P500. From Suze Orman's book "The Road to Wealth", pages 471-473, she addresses index annuities and explains them. Though she generally believes annuities are not good, she feels the index annuities are a good thing for certain people. If you don't know who Orman is, check out PBS. I understand she's also on CNBC. Only you can learn all you need to know to decide if you are one of the people for whom this annuity would be suitable. Good luck.