Annuity Myths   

1. "All annuities have a bunch of fees"- Myth. Generally speaking, variable annuities have the most fees. Fixed annuities and immediate annuities usually have no fees.  Some annuities offer optional riders that have fees.  Tip: Ask the company to disclose any fees in writing for the contract.  

2023s Best Annuities - Find the annuities with the highest rates, lowest fees and highest guaranteed returns in our free report

2. "The insurance company will take your money if you die" Myth. This only applies to immediate annuity with a “life only” structure. This does not apply to fixed, index, or variable annuities. When you purchase a fixed, index or variable annuity you designate a beneficiary to whom the money will be paid to. Tip: If you purchase an immediate annuity with a “life with cash refund or life with installment refund” structure the listed beneficiaries will receive 100% of the remaining dollars.  

3. “All Annuities are bad” Myth. Annuities are financial tools when used in the right situation, make sense. Statements like “All Annuities are bad” are extremely misleading.  Annuities are neither as bad nor as good as what people say. They are a fit for some people who are looking for safety and security.  In general, variable annuities have the worst reputation. Tip: Traditional fixed annuities, immediate annuities and longevity annuities have the best reputation. 

4. "All annuities have huge commissions"  Myth.  Index and variable annuities generally have the largest commissions.  Fixed annuities and immediate annuities have the lowest commissions. So low that most agents don’t promote them.  Tip: Annuities with the shortest terms usually have the lowest commissions and are the best choices. 

5. "You can earn 7-8% guaranteed returns for life in an annuity" Myth. If you took $100,000 and buried it in your backyard and took out $8,000 per year, some insurance agents would consider this an 8% return. Be smarter than that. There is a difference between earning an 8% internal rate of return or yield and 7-8% annuity payout. Tip: Find out how much of the promised benefit is your own money being returned back to you. Ignore any agent or company which uses these returns to influence your decision. 

6. "My local bank or investment firm offers good annuities" Myth  Did you know that banks and many investment firms have what is called an “approved list?”  This is a list of annuity products they can offer to their customers. Do you know that insurance companies have to pay huge fees to be on the “approved list” of many firms?  This means the friendly person at your local bank or investment firm can not offer annuities not on their list. Tip: Shop around with an independent agent to find the best products available. 

Looking for retirement income? Our free report shops 130+ annuities and highlights the companies with the highest guaranteed returns

Compare 1400+ annuities from the two largest annuity databases. Find the highest guaranteed returns