The takeaway: Fixed annuities are like CDs, except you earn a higher rate. Even better, your interest grows tax deferred. But there are steep penalties for early withdrawal. And tax treatment isn’t particularly favorable to your heirs. Look before you leap. $$$ Part six in a series on annuities that will appear here from … [Read more…]
The takeaway: equity indexed annuities allow you to participate in the stock market, with minimal losses and some gains. However, your market gains are substantially limited by fees and contract restrictions. Plus, obscure interest calculations make it hard to verify you’re getting the returns you were promised. Better alternatives exist, so think twice. (Maybe three times.) … [Read more…]
The takeaway: Immediate and longevity annuities pay you income for life, charge the lowest fees, and charge the lowest commissions. If the stock market is making you a teensy bit nervous, they might be worth a second glance. They’re about the cheapest annuities you can buy. As always, you’ll need to weigh the pros and cons. … [Read more…]
The takeaway: An annuity bankruptcy doesn’t happen everyday, but it does happen. (Just ask me.) Protect yourself with these three must-do actions. Don’t be my younger self! $$$ Part 3 of a series on annuities that will appear here from time to time. $$$ All I had to do was swing by the bridal shop, … [Read more…]
The takeaway: You can lose a bad annuity without losing your shirt — maybe. Even though annuities can alleviate a lot of anxiety about outliving your money, sometimes what seemed like a winner turns out not to be. Since you typically put a fair amount of money into an annuity, it’s important to understand your … [Read more…]