Lifetime Income Annuity?

Pro's: lifetime income, will never stop receiving payments even if payments exceed amount put in.

Con's: Expensive, Illiquid, Expensive again.

quote:

---

cons- illiquid, no market upside

---

Hunh? Maybe lessor upside than regualr funds, but there is definitely upside potential.

Are you talking about a SPIA or annuity contracts in general?

Pros:
lifetime income stream
the person selling it to you gets a big commission

Cons:
low returns/growth
expensive admin fees
usually penalties if you need to cash it out, forfeiting any growth
extra fees for adding other benefits
decreased payments for adding spouse

Annuities can fill a specific need here and there, but generally the only winners are the insurance companies and the salesman.

quote:

---

If you and your spouse die in a car accident, your kids get nothing.

---

Not the ones I have looked at. They pay whatever you have paid in if both of you die.

I was just looking for another form of retirement. I don't want to have all my eggs int he same basket. The company I work for now doesn't really have anything, but they pay an extra 4% because of it.

Ok, so you are not talking about SPIAs. How old are you? They are not a bad deal for a portion of your portfolio. However, you buy them for income not appreciation.

quote:

---

Annuities are for chumps. If you and your spouse die in a car accident, your kids get nothing. Those insurance actuaries like annuities for a reason...it enriches insurance companies.

---

FWIW, I hate when people make a statement like this that other people are obviously going to read (and potentially digest as good advice)...Especially given the fact that it is completely over generalized, unspecific, and flat-out false because of that.

#1 there are many different types of annuities...income annuities, fixed annuities, variable annuities, index annuities, pension annuities, annuities with riders, annuities with LTC, etc etc etc.

#2 they are all different and all serve a different purpose and accomplish different things and have different options. The bulk of non-SPIA annuities are never even converted to an income stream.

#3 assuming you are talking about an income annuity or "SPIA", and not other annuities more built for accumulation/ tax benefits/protection/savings (fixed, index, variable, etc), you basically just said "pension plans are for chumps." Not to mention you obviously have no clue what the term Cash Refund Annuity means, based on your assertion of "you die, money gone."

I'm not advocating for or against annuities in general - they are merely another investment option with its own positives and negatives that can be a part of some people's overall plan and can conversely have No role in another persons plan - ... I'm just 100% opposed to people talking out of their arse when they obviously should be listening and learning Instead of sharing financial advice/assistance to others that might unfortunately actually be listening to said uninformed and amateur advice.

Yeah, I know....this is on down the list of my go-to boards on TD (so I never even see 90% of the stuff on the MB), but occasionally if I get bored I'll check it out....I at least try to do my part when I do occasionally spot someone spewing non-sense....it's one thing if someone babbles crap on the Rant or the SECr, but when someone starts giving uneducated financial advice to others on the MB I definitely feel obligated to call them out and correct them.