They have tax advantages, but not I'm a fan unless you're within less than 10 years of retirement. I'm not investing in them until after maxing out my ROTH and SEPP IRA's, it's just not worth tying up my money for mediocre returns.

This post was edited on 1/17/13 at 1:50 pm

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Posted by matthew25

Member since Jun 2012

9425 posts

Posted on 1/17/13 at 1:39 pm to Vols&Shaft83

Barney - I pulled out the packet I was given for MetLife $250K variable annuity application with guaranteed income of 5%. Fees were .25 for admin, 1.05 for mortality and expense, and 2.65 for the guarantee.

For me, 5 minus 3.95 was a mere 1.05% gain (plus the gain if the index goes up >5%).

I passed, and put the money in mutual funds.

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Posted by Jake88

Member since Apr 2005

68616 posts

Posted on 1/17/13 at 7:49 pm to Vols&Shaft83

quote:
They have tax advantages, but not I'm a fan unless you're within less than 10 years of retirement. I'm not investing in them until after maxing out my ROTH and SEPP IRA's, it's just not worth tying up my money for mediocre returns.

I'm an anxious guy and the guaranteed income for life rider costs 0.65% of the principle per year. Even with the fixed annuities mediocre returns in good years, it seems attractive as I have no pension. Like I mentioned I've got a 401k going and some other IRA's as well as mutual funds and individual stocks that are not part of an IRA, but when the market takes a dump like 2008/9 and 2000, I take it in the shorts.

I'm 41 and I guess I just want some of my retirement income guaranteed. I've been investing since 1998 and have gone through two crappy periods and don't feel as though I've gotten as far as i'd like.

Are there loopholes and/or tricks the insurance company includes in these contracts that can screw me in the long run? What happens if the insurance company goes out of business ten years into my annuity?

Thanks.

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