Can Annuities Lose Money? 
That is an excellent question ! While your agent may be quick to assure you otherwise , it is possible to lose money on an annuity , but it 's awfully tough to do . If you 've done your homework , and had a good agent , you will almost always come out ahead . You can lose money if : Your guaranteed interest rate is lower than the cost of inflation , and the cost of the fees on the annuity are unreasonably high ; if you have a variable annuity without guarantees , and the market tanks like it did in 2008 ; and if the money that you invested in the annuity could have brought you a higher rate of return had it been invested elsewhere . If you 've done your homework and made sure that your annuity covered these bases , you should find yourself sitting on a healthy income stream for many years to come . I hope that helps , thanks for asking ! 