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Posted on 2/6/23 at 3:17 pm to TDTOM
quote:
Fixed index annuities don't have fees unless you add a rider. The fees are built in the participation rates or cap rates.
That’s still a fee and it’s quite expensive. It’s the same argument as my healthcare is free bc it’s subsidized in my taxes.
Posted on 2/6/23 at 3:58 pm to Shepherd88
That depends on who you ask. To have zero downside risk and capture the first 11% of return may be seen as a hell of a deal to the OP. To you who is willing to stomach volatility not so much. My only point in this thread is that whether a FIA is a good idea is solely based on the owner's opinion. Also, I am not aware of any 7 year FIA that pays 7%.
Posted on 2/6/23 at 5:57 pm to TDTOM
Thanks for all the replies. Though there are varied opinions, the vibe i get, overall, is that an FIA is reasonable in certain circumstances. That is the conclusion I've come to which is 180 degrees from where I was for years-just wanted to check my thinking from "objective" sources 
Posted on 2/7/23 at 6:05 am to Shepherd88
quote:
You have a lot of assets tied up into illiquid investments my friend. If you want to pay some broker 7% commission on a product to never hear from him again then by all means…
THIS
Posted on 2/7/23 at 8:02 pm to TDTOM
quote:
quote:
the only downside is annuity management fees
Fixed index annuities don't have fees unless you add a rider. The fees are built in the participation rates or cap rates
Every insurance policy has management fees.
Annuities are insurance policies.
It is in the contract somewhere.
There are also fees charging you to withdraw the money (and I don't mean surrender charges).
Posted on 2/7/23 at 9:25 pm to meansonny
quote:
It is in the contract somewhere.
It isn’t.
The fee (profit) is baked into the spreads and caps.
Posted on 2/7/23 at 10:33 pm to slackster
quote:
The fee (profit)
Fee is cost. Not profit.
Posted on 2/8/23 at 12:06 am to meansonny
quote:
Fee is cost. Not profit.
I should have said profit margin. I’m piggybacking on your comment about the insurance product fees
Posted on 2/8/23 at 6:31 am to slackster
Costs get passed on.
I won't be able to pull a contract for a couple of weeks. But I will get one and share it.
You are responding as if the fixed index annuity is altruistic in nature. Lol. No. If they could charge you for answering a customer service phone call, they would.
I won't be able to pull a contract for a couple of weeks. But I will get one and share it.
You are responding as if the fixed index annuity is altruistic in nature. Lol. No. If they could charge you for answering a customer service phone call, they would.
Posted on 2/8/23 at 7:28 am to meansonny
quote:
You are responding as if the fixed index annuity is altruistic in nature. Lol. No. If they could charge you for answering a customer service phone call, they would.
Literally no one has argued that.
We’re arguing the fees for a fixed or fixed index annuity are similar in concept to a CD. Obviously a bank or insurance company exists to make money, so they’re taking their profit margin out of the rate they offer you off the top.
You’re trying to act like there is an additional fee they’re charging you for management, which is simply untrue.
Posted on 2/8/23 at 1:50 pm to slackster
There are more insurance regulations than banking regulations.
Insurance fees are above the table and disclosed. (Is that what you mean comparing fees to a CD?)
Insurance fees are above the table and disclosed. (Is that what you mean comparing fees to a CD?)
Posted on 2/8/23 at 5:08 pm to meansonny
quote:
Insurance fees are above the table and disclosed. (Is that what you mean comparing fees to a CD?)
I mean that a fixed annuity, or a fixed index annuity, take their “fees” out of the rates and caps they offer the customer. A 5-yr fixed annuity at 5% typically has no fee other than a surrender charge for excess withdrawals. A 5-yr fixed index annuity with a 7% point to point annual S&P 500 cap typically has no fees other than a surrender charge for excess withdrawals. A 5 yr CD at 4% has no fees other than a penalty for early withdrawal.
Both the insurance company and the bank are making money off of your money, and their “fee” is just baked into the rate they’re offering customers.
Posted on 2/8/23 at 5:36 pm to slackster
You have way more patience than I do to continue this conversation.
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