Quote:
Originally Posted by Dog Boy
I was not suggesting a variable annuities. With a Fixed Indexed Annuity there is no wrapper markup and no underlying fees.
So, with these products you're getting 'market exposure' with a minimum return of Zero [in many but not all cases], huge surrender fees, and while taking the credit risk of the insurer. Even a 'guaranteed' return of 4%, before fees, is fairly low. Sounds Awesome!
I am SO SHOCKED your
father sells these! I'm sure the guys at BFI will be jumping all over themselves to invest in these, free mobniez for your family imo.
Secondly, there is an additional layer of commissions on these, and only an Idiot Boy like yourself would pretend otherwise.
Well played. NH sir.
Again, anyone with a modicum of math skills and a few hours reading up on index/bond/ETFs could replicate the same long-term return pattern at lower cost. It's really not that hard to figure out. And no surrender fees. And no credit risk from an insurer. And no 2nd layer of hudge commission fees.
As for the plan I oversee, people choose their own investments, that's what a 401[k] plan is. I don't force an asset allocation or investment on thousands of employees and hundreds of millions of dollars. If someone wants to put 100% of their $$ into a MMF earning 8 bps or Davis NY Venture or Pimco Real Return, that's up to them.
ed: Consumer Reports weighs in - 'But there are several reasons why we are not big fans of these products. Because there are several different methods of calculating interest, it’s very hard to compare products. The commissions on most of these annuities are high, so the insurance company that sponsors them pass on those costs to investors in the form of high fees. And since they’re classified as an insurance product, they are subject to fewer regulations than securities and may be sold by people who are not registered brokers.'
Last edited by NajdorfDefense; 11-20-2009 at 10:58 PM.