If you think you really can get something for nothing, you probably believe in Atlantis, the Wee Folk and the claims of unscrupulous salesmen. There are good reasons to buy a variable annuity, but bonus offers usually aren't among them.
Variable annuities are tax-deferred retirement plans.
Like an individual retirement account, a variable annuity lets you defer taxes on your earnings until you withdraw them at retirement. Unlike fixed annuities, which guarantee you an income for life, returns from variable annuities are, well, variable. You can invest in a number of mutual funds, called subaccounts, within the annuity. Technically, a variable annuity is an insurance product, which is why it's tax-deferred. Some policies offer step-up provisions, which increase the amount guaranteed at regular intervals.