Annuities and the Impossible Dream of Risk-free Growth
August 5, 2020 by Sponsored Content
We should note right off that we’ve written plenty about the pitfalls of annuities, especially variable and equity-indexed annuities.
Click HERE to read the “Paid and posted by Fisher Investments” article via Reuters.
Wink’s Note: Dear Reuters,
We know that Fisher Investments sponsored this content, but you should be concerned about the inaccuracy of the statements therein.
1. They are not “equity-indexed annuities.” They are indexed annuities. Period.
2. Indexed annuities are not an “investment.” They are insurance. These financial instruments are used as a risk-transfer tool, to guarantee purchasers a paycheck for the rest of their lives.
3. As such, annuities should not be positioned against stocks the way they were in this blog; they are not priced for market-like returns because of their insurance component.
4. No indexed annuity promises a 3% guaranteed annual return.
5. Indexed annuities do not have “layers of fees,” as some variable annuities do. Just a few indexed annuities, out of the 500+ even have fees. This is misleading.
I would encourage Reuters to fact-check their content, regardless of whom sponsors it, going forward. It is hard to conceive how many Reuters customers could be erroneously misled if inaccurate information continues to be sponsored by your partners. -sjm
