Talk:Annuities in the United States

message: I'm a financial planner. I prefer to not use annuities because my clients have to hold them a very long time to break even after tax over mutual funds. Regardless, all of the pros and the cons of these should be enumerated. I find that annuities are useful in a couple of circumstances. 1. The client will not otherwise invest in the market without the guarantees of the annuity, and thus the client will wind up with more after tax than using other guaranteed investments like government bonds and FDIC insured cash vehicles. 2. The client needs income guaranteed for life, and both fixed and variable annuities can do that, with variable annuities maximizing the possibility of earning more. 3. Defer taxes, but this applies to almost no-one, and most people don't put money in annuities to defer taxes because in mutual funds most gains are taxed at long term capital gains rates. (When I hear people knee-jerk response "why use something that's tax deferred in a retirement account?" I am completely disgusted by their ignorance, because people usually buy annuities for the guarantees and oh by the way if you use them outside a retirement account, your taxes are deferred, but you're probably worse off.)
These sound like arguments for annuities, and I suppose they are, but I can usually educate my clients enough to not want them. But some people won't care about costs, and aren't these articles supposed to educate everybody?
I charge for advice based on a percentage of assets under management. I make more money over the long run if my clients make more money over the long run, that's why I don't like annuities. If I charged on an hourly basis, the client would be paying much more. If people don't want to pay for professional advice, they can work with a no-help company like Fidelity or Vanguard. Aaronchall 21:03, 23 December 2006 (UTC)
thread_title: Bias

message: Here's the reason there's not much discussion of no-load annuities: there's virtually no reason to use them except to defer taxes.  Here's the sole situation where it's useful: the client only wants money in non-tax favored investments (like real estate, commodities, and bonds), is in a high income bracket (like 35%) and will eventually be in a low income bracket (which few planners expect for someone in a high income bracket.)  The main reasons people use annuities are for the guarantees.  No load annuities have very few guarantees, if at all.  This may change in the future, but it's currently the case now.  So quit complaining. Aaronchall 21:13, 23 December 2006 (UTC)
thread_title: No load annuities

message: I do not feel the cautions are biased.  For any investments, an encyclopdic article should point out the pros and cons in a clear fashion.  I still think it is best to address issues right at the section where they occur, versus having a separate "cautions" section.  One possibility would be to work the materials into the main text, so they do not appear out of place. -MegaHasher 16:36, 24 April 2006 (UTC)
thread_title: Cautions

message: Very soon this section will evolve into a long list of names.  I do not feel there are good criteria to decide why some names should be kept while deleting some others.  My take is to delete all of the names. MegaHasher 02:49, 11 July 2007 (UTC)
thread_title: Companies

message: We need a section explaining why States allow these legal mechanisms to exist. Perhaps old men understand it. I would guess to promote savings.Holon67 (talk) 20:53, 4 April 2008 (UTC)
thread_title: Motivation of the State

message: This section needs to be updated to reflect the rapidly changing market of Living Benefit annuities. I too am an asset-under-management advisor, and have hated most annuities for my entire career. However, living benefits have changed my tune (IF you can find a low cost product!), and it fits the client (i.e. they refuse to invest in stocks/funds without a guarantee). Geoffvf (talk) 19:01, 15 May 2008 (UTC)
thread_title:  Criticism Update 

message: My understanding was that the payments from an annuity end when you die, the insurance company dies or the currency dies -- whichever comes first.
I feel that there should be some mention of the possiblity of the currency dying.  Even a large shrinkage in the currency could
reduce an annuity payment to a pittance.  —Preceding unsigned comment added by 76.90.1.186 (talk) 22:55, 24 January 2010 (UTC)
thread_title:  Annuity ends when ... 

message: Substituted at 00:55, 12 June 2016 (UTC)
thread_title: Assessment comment

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thread_title:  External links modified