Bashers, Haters And Agitators
September 18, 2019 by Mike Janky
I just finished reading another incredibly biased article bashing annuities and how they are going to ruin 401(k)’s. Having nearly 30 years in the industry on both the investment and insurance side of the fence, I would like to discuss what I feel are the true benefits of annuities and how they can actually save those heading into retirement from becoming dependent on friends, relatives or the government in order to maintain their standard of living.
Why haters got to hate annuities?
First, why is it that some in the securities world cannot say enough bad things about annuities? After all, annuities can be the perfect fit for the right person in the right situation. The sad truth to most of the negative press on annuities comes down to money. For a Registered Investment Advisor, their normal form of compensation is to charge a fee based on the assets under management. If a client owns either a traditional fixed or an immediate annuity, it is difficult for the investment advisor to charge a fee. Now the annuities do typically pay an up-front commission but it’s not nearly as lucrative to the advisor as charging an asset fee year after year. Rather than picking sides, I prefer to identify some situations where an annuity can be the absolute best option for someone concerned about income at retirement, as I believe that some form of an annuity should be in every retired person’s portfolio.
Click HERE to read the full story via Advisor Magazine.
