Annuity - good or bad

[GREENBACK]

I have yet to have a taker here for sending all of their money to me and me sending them a monthly check.

I don't see why. . .maybe I need to name myself something rock solid sounding. . .like First American International General Equity Debt or something. . .then you will all send me your money.

Your problem is that you haven't invited us to a free luncheon and seminar where you guarantee that the money we give you will never, ever be lost. When the market goes down we won't lose anything and we'll always earn 2% every month. If that's your angle then count me in Mr. Madof.

[nylchicago1]

I do not agree with a lot of the replies I currently work for New York Life and I have been saving people a tremendous amount of losses of their retirement money by rolling assets into fixed annuities. We also do offer guarantees on most of them with a min. of 3%. But again we are a very stable company I would not buy one from anyone but. We also offer products that do pay you for LifeTime.

[Bryan Anderson]

Do the math

The answer is simple. I am sorry you haven't received a decent piece of advice yet.

Pensions rarely pay a lump sum that is equal to the size of the annual income on an actuarial basis. It's not always the case so you need to make some calculations before you decide.

At age 60, immediate annuities typically pay 7-8% of the invested amount annually for life. That payout rate increases with age. If that exceeds the amount of income you will give up by taking a partial lump sum then it is a wise move. Plus, you are earning interest and when you do use the money, your monthly payments will be even larger.

Now, let's calm the fears you may have about annuities after reading all this great advice everyone gave you.

*A 15 or 20 year lock-up (surrender) period is outrageous and it is very easy to find a contract that is ten years or less. Most good contracts are in the seven year ballpark.

*Terminal illness waiver- again, good contracts will waive all surrender charges in the event you face terminal illness, long term care or other medical hardships

*Also, companies are required by law to give limited access to the funds invested, usually 10% and sometimes higher without penalty.

*All annuity contracts can be turned into a stream of income after the first contract year without penalty.

*Don't worry about how much money the agent will make. As long as you stay away from annuities with long surrender schedules, then you don't have a problem.

The simple calculation as the top of the post is all you need to be concerned with for now. If the math points you toward an annuity, shop around. Any good agent won't be threatened by this. Even if it just confirms that your saleman showed you the best thing you can get then you'll at least sleep well knowing you got a good deal.

Good Luck

Bryan J. Anderson

[sweeps]

The answer is simple. I am sorry you haven't received a decent piece of advice yet....

OP, this is the kind of sales pitch you will face when shopping for annuities. Be very cautious.

[DebbieL]

Thank goodness Bryan came along with some decent advice finally (giggle). Work must be slow these days, lol.

[Bryan Anderson]

Sales pitch?

I don't recall trying to sell anything. Name one piece of information in my post that is inaccurate.

All I offer is an analytical approach to a simple question. As far as I can tell, I'm the only person who has answered the question so far.

Everything else is simply narrow minded product bias.