InsuranceGuy,
I'm guessing from your screen name you are in the insurance business. I would partially disagree on the non-qualified annuities. I'm assuming you were referring to guaranteed interest annuities since you said "avoid the pitfalls of the stock market". Variable annuities have "separate accounts" which are just like mutual funds. I would NOT buy an annuity if it were invested in the stock market. Annuities are ordinary income taxed upon withdrawal so you lose the tax benefits of capital gains and losses. Guaranteed interest annuities are ok, but most of them have "contingent withdrawal charges" for 5-10 years. That means you get hit with a penalty if you withdraw before that time. Most have 10% free withdrawals which means you can withdraw 10% of the account each year without a penalty. However, if you are not 59 1/2, you will incure an IRS penalty plus income taxes on any gain. So, there is a lot of fine print to read on annuities. I sold a ton of guaranteed interest annuities back in the late 70's and early 80's when interest rates were so high. Guarantee interest annuities have some benefits, but you have to really read and make sure they are suitable for you.
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