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Fixed index annuities for retirement funds.
Posted on 6/27/18 at 1:16 pm
Posted on 6/27/18 at 1:16 pm
I have been looking at them for my 401k funds when I retire in 3 years. I understand how they work as we attended a dinner seminar. Anyone have thoughts or experiences with them?
5
Posted on 6/27/18 at 1:19 pm to Cool Hand Luke
just look closely and understand what you are getting, I have never seen an annuity that I liked
Posted on 6/27/18 at 1:21 pm to Cool Hand Luke
quote:
I understand how they work as we attended a dinner seminar.
put on by someone who would be making a large commission if you bought it?
Posted on 6/27/18 at 1:29 pm to Cool Hand Luke
you’re buying an extremely illiquid investment that has a very low chance of making a decent return so the representative can make an 8% commission.
FINRA has a warning out on these products as well.
FINRA has a warning out on these products as well.
Posted on 6/27/18 at 1:29 pm to Tigerpaw123
quote:
put on by someone who would be making a large commission if you bought it?
So? What's your point?
Posted on 6/27/18 at 1:35 pm to bstew3006
The way I understand it, you don't pay any commission. The agency pays it. You only pay a fee if you elect certain options such as an income rider.
Posted on 6/27/18 at 1:35 pm to Shepherd88
quote:
representative can make an 8%
Holy shite!! What Company pays 8% commission on annuities? I've seen 1-3%, but gah damn who is paying that?
Annuities have fees, most total 2-3%, annually.
FYI, not a fan of indexed annuities. Annuities def have there place. If you understand that particular product and like it, do it.
This post was edited on 6/27/18 at 1:37 pm
Posted on 6/27/18 at 1:37 pm to bstew3006
I just like the no risk element. Not planning on dipping into my 401k anytime soon after retirement.
Posted on 6/27/18 at 1:43 pm to Cool Hand Luke
quote:
I just like the no risk element
If you like the Principle amount being guaranteed, then a particular annuity is the way to go, in my opinion. I don't care if the agent/rep/advisor is making an annual fee or 1 time commission, having a guarantee is worth it. But you will give up liquidity, but if you don't plan on touching any time soon after retirement, then it's not a concern.
This post was edited on 6/27/18 at 1:46 pm
Posted on 6/27/18 at 2:10 pm to Cool Hand Luke
quote:
I have been looking at them for my 401k funds when I retire in 3 years. I understand how they work as we attended a dinner seminar. Anyone have thoughts or experiences with them?
I don't have much experience with annuities, but I think it can be a good option to set a "floor" for retirement income. Especially if you have significant nest egg and want to take some risk off the table. I would be less interested if it was my primary source of retirement income. As stated, be aware of high fees associated with some annuity options.
Posted on 6/27/18 at 2:33 pm to Oenophile Brah
If I needed it to be liquid I would probably look elsewhere. My wife and I will have about 90k per year pension so we can live on that.
Posted on 6/27/18 at 3:04 pm to Shepherd88
quote:
FINRA has a warning out on these products as well.
Posted on 6/27/18 at 3:09 pm to Cool Hand Luke
quote:
The way I understand it, you don't pay any commission. The agency pays it. You only pay a fee if you elect certain options such as an income rider.
And that is the lie they tell you bc you don’t have to be securities licensed to sell these things. Why don’t you ask him how much you can get back out if you decide don’t like it after 3 years?
Posted on 6/27/18 at 3:21 pm to Shepherd88
There is a early surrender penalty that drops 1% per year. So it will be 7% in year 3.
Posted on 6/27/18 at 3:27 pm to Shepherd88
quote:
And that is the lie they tell you bc you don’t have to be securities licensed to sell these things. Why don’t you ask him how much you can get back out if you decide don’t like it after 3 years?
False, you need a series 6 securities lic
The commish is paid by the company, which is collected in the annual fee (annual fee is based on principle, not accumulated value. Be sure you ask about this).
Certain annuities, depending on companies, have 24 month cancellation with no charge. Some have no surrender charge period, but don't have the bells and whistles that make annuities attractive. The ones that do give the guarantees have 7 - 8 yr window.
Posted on 6/27/18 at 3:31 pm to bstew3006
Thanks for the responses. I have a few years. Just don't want to deal with the market fluctuations once I am no longer employed.
Posted on 6/27/18 at 3:31 pm to Cool Hand Luke
quote:
There is a early surrender penalty that drops 1% per year. So it will be 7% in year 3.
Seems a bit high, figure it would be about 4-5%. I'd look at New York Life, Northwestern or Mass Matual for annuity options.
If you like the attractiveness of an annuity, Talk with a rep at one of the companies listed. I'm not a fan of indexed annuities. I know NYL doesn't offer indexed annuities, mainly bc people don't fully understand the difference in those and a Variable annuity. Lots of lawsuits with indexed annuities, Just FYI
This post was edited on 6/27/18 at 3:41 pm
Posted on 6/27/18 at 4:18 pm to Cool Hand Luke
What company was the agent promoting?
Posted on 6/27/18 at 4:23 pm to iknowmorethanyou
quote:
What company was the agent promoting?
Probably one that's legit, like Primerica
Posted on 6/27/18 at 4:27 pm to bstew3006
The Mutuals are God awful in this space as well. Some of the most reputable and reliable contracts are offered by companies nobody has ever heard of.
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