Home › Forums › Financial Markets/Economics › Need advise…Allianz variable annuities
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February 20, 2007 at 2:58 PM #8438February 20, 2007 at 4:10 PM #45852
(former)FormerSanDiegan
ParticipantQ: Why do you need a variable annuity if the money is already tax-deferred ?
A: So the financial advisor can make a commission.(SO, you know my opinion)
Are you CSRS or FERS ?
If were were covered under CSRS your pension is probably pretty good, so you may not need a huge amount of guaranteed income from the TSP portion, which is what this annuity will presumably buy you.If you are FERS, then you probably need a larger portion from the TSP since the annuity portion is about half what you’d get if you were CSRS.
These are important considerations to figure out what advice to give.
How much income do you need from the TSP to supplement your Pension income from the Gov’t ?
Also, you asked whether to roll into a variable annuity or keep it in the TSP, but you have a third option.
You can roll it over into an IRA at any financial institution (e.g. brokerage, bank, credit union).February 20, 2007 at 6:10 PM #45859michael
ParticipantI would highly discourage you from using an annuity product. As mentioned in the previous post, your funds are already in a tax-deffered vehicle. Annuities also have additional fees. The most common fee is an M&E (Mortality and Expense) charge. The M&E can run anywhere from 1.2% to 1.7% of total assets. And although it may not sound like much, the compounded effect of the extra fees can be significant over an extended period of time.
Annuities are also sold with differing surrender periods. A shares have lengthly surrender periods – usually about 7 years. L shares usually have 4 year surrender periods and C shares have a 1 year surrender period. Each share class has differing M&E charges. The “advisor” gets paid the highest upfront commission on the A shares. Usually about 5%.
You also should be weary of “Index” annuities. Allianz offers these annuities and they are BAD. Index annuities claim they track an index but in reality the formula used to calculate the return on investment differs greatly from the actual performance of the index, even before fees. The surrender periods are usually 10 years. The annuity pusher usually gets an upfront pop that can be as high as 8%. Index annuities are not registered products and therefore any person that can fog up a mirror and pass an insurance exam (anybody) can sell these products.
My advice is to stay away from annuities. Talk to a Certified Financial Planner and explore different options.
Good luck.
February 20, 2007 at 7:42 PM #45864IrvineRenter
Participantvariable annuities were designed to enrich those selling them. Just say no.
February 20, 2007 at 7:45 PM #45865bob2007
ParticipantI went through all the details with a parents retirement savings. Luckily I stopped it in time. Variable annuity sales are where the the adjustable bed guys aspire to be.
February 20, 2007 at 8:01 PM #45868Raybyrnes
ParticipantBob2007,
My dad is a retired 15 -10 EPA. Has a life time stream of income so you might be in a similiar situation. Lot of posters here showing bias agains the annuities but I would give them some thought. WHile the expenses are high ther are some benefits to sonsider aswell.
1) You usually have a numbe of accounts inside the annuity you can chhose from. This allows you to avoid taxable gains and change funds as your risk changes.
2) You obviously feel like a hero if the market collapses and you have a 7% gaurantee
3) you might have some exeptional fund choices inside the anbnuity that have been closed off.This is not to say that I disagree with the other posters. Annuity have high expenses adn if you are a retired govt guy you should have the gauranted income comeing in from the government but you shoul,d always be aware of your option. For your specific siuation Who Knows?
Perhaps a more formidable question is whthe you take out a life insurance policy now and elect the full payout on the pension or if you take the reduced payout and and cover your spouse. My father might have reconsidered his option to reduce the payout in hindsight,
October 20, 2009 at 7:34 PM #471534chupee
ParticipantHi there Truly sad how many morons their are on this ite. after 23 years in the fincancial industry im still amazd at the stupidity i see everyday. First off NO ONE HAS EVER LOST A PENNY IN AN INDEXED ANNUITY OR A FIXED .. FACT That did not violate the terms of the contract . so for all you know it all show me a statement where anybody lost a penny in the last year or in 2000 or in any year abd I buy you dinner anywhere in the country. Cant do it , I know Thanks to the ego-maniacs i see here and elsewhere millions of seniors now have crushed dreams and millions ae looking or oart time work at Walmart .. Good call guys .. Perhaps you have not seen the study from the 2 Prof. at Wharton Bus School i know youre all smarter then they are and you see the real returns of indexed annuities BETTER THEN ALL THE OTHER ASSET CLASSES AND BEST OF ALL NO FEES IN DOWN MARKETS HOW MANY BROKERS CAN BEAT THAT . Stop lying to your clients and show me your top 50 accounts for jan 2007 till now and ill show you mine ,,, i averaged 12-19.99% in that period and still have EVERy DAMM PENNY PLUS ALL MY PRINCIPAL And paid no fes … So put up or Shut up already
October 20, 2009 at 7:34 PM #471717ParticipantHi there Truly sad how many morons their are on this ite. after 23 years in the fincancial industry im still amazd at the stupidity i see everyday. First off NO ONE HAS EVER LOST A PENNY IN AN INDEXED ANNUITY OR A FIXED .. FACT That did not violate the terms of the contract . so for all you know it all show me a statement where anybody lost a penny in the last year or in 2000 or in any year abd I buy you dinner anywhere in the country. Cant do it , I know Thanks to the ego-maniacs i see here and elsewhere millions of seniors now have crushed dreams and millions ae looking or oart time work at Walmart .. Good call guys .. Perhaps you have not seen the study from the 2 Prof. at Wharton Bus School i know youre all smarter then they are and you see the real returns of indexed annuities BETTER THEN ALL THE OTHER ASSET CLASSES AND BEST OF ALL NO FEES IN DOWN MARKETS HOW MANY BROKERS CAN BEAT THAT . Stop lying to your clients and show me your top 50 accounts for jan 2007 till now and ill show you mine ,,, i averaged 12-19.99% in that period and still have EVERy DAMM PENNY PLUS ALL MY PRINCIPAL And paid no fes … So put up or Shut up already
October 20, 2009 at 7:34 PM #472077ParticipantHi there Truly sad how many morons their are on this ite. after 23 years in the fincancial industry im still amazd at the stupidity i see everyday. First off NO ONE HAS EVER LOST A PENNY IN AN INDEXED ANNUITY OR A FIXED .. FACT That did not violate the terms of the contract . so for all you know it all show me a statement where anybody lost a penny in the last year or in 2000 or in any year abd I buy you dinner anywhere in the country. Cant do it , I know Thanks to the ego-maniacs i see here and elsewhere millions of seniors now have crushed dreams and millions ae looking or oart time work at Walmart .. Good call guys .. Perhaps you have not seen the study from the 2 Prof. at Wharton Bus School i know youre all smarter then they are and you see the real returns of indexed annuities BETTER THEN ALL THE OTHER ASSET CLASSES AND BEST OF ALL NO FEES IN DOWN MARKETS HOW MANY BROKERS CAN BEAT THAT . Stop lying to your clients and show me your top 50 accounts for jan 2007 till now and ill show you mine ,,, i averaged 12-19.99% in that period and still have EVERy DAMM PENNY PLUS ALL MY PRINCIPAL And paid no fes … So put up or Shut up already
October 20, 2009 at 7:34 PM #472153ParticipantHi there Truly sad how many morons their are on this ite. after 23 years in the fincancial industry im still amazd at the stupidity i see everyday. First off NO ONE HAS EVER LOST A PENNY IN AN INDEXED ANNUITY OR A FIXED .. FACT That did not violate the terms of the contract . so for all you know it all show me a statement where anybody lost a penny in the last year or in 2000 or in any year abd I buy you dinner anywhere in the country. Cant do it , I know Thanks to the ego-maniacs i see here and elsewhere millions of seniors now have crushed dreams and millions ae looking or oart time work at Walmart .. Good call guys .. Perhaps you have not seen the study from the 2 Prof. at Wharton Bus School i know youre all smarter then they are and you see the real returns of indexed annuities BETTER THEN ALL THE OTHER ASSET CLASSES AND BEST OF ALL NO FEES IN DOWN MARKETS HOW MANY BROKERS CAN BEAT THAT . Stop lying to your clients and show me your top 50 accounts for jan 2007 till now and ill show you mine ,,, i averaged 12-19.99% in that period and still have EVERy DAMM PENNY PLUS ALL MY PRINCIPAL And paid no fes … So put up or Shut up already
October 20, 2009 at 7:34 PM #472373ParticipantHi there Truly sad how many morons their are on this ite. after 23 years in the fincancial industry im still amazd at the stupidity i see everyday. First off NO ONE HAS EVER LOST A PENNY IN AN INDEXED ANNUITY OR A FIXED .. FACT That did not violate the terms of the contract . so for all you know it all show me a statement where anybody lost a penny in the last year or in 2000 or in any year abd I buy you dinner anywhere in the country. Cant do it , I know Thanks to the ego-maniacs i see here and elsewhere millions of seniors now have crushed dreams and millions ae looking or oart time work at Walmart .. Good call guys .. Perhaps you have not seen the study from the 2 Prof. at Wharton Bus School i know youre all smarter then they are and you see the real returns of indexed annuities BETTER THEN ALL THE OTHER ASSET CLASSES AND BEST OF ALL NO FEES IN DOWN MARKETS HOW MANY BROKERS CAN BEAT THAT . Stop lying to your clients and show me your top 50 accounts for jan 2007 till now and ill show you mine ,,, i averaged 12-19.99% in that period and still have EVERy DAMM PENNY PLUS ALL MY PRINCIPAL And paid no fes … So put up or Shut up already
October 20, 2009 at 8:15 PM #471544pka4lif
ParticipantMeet with a different Financial Advisor. Hell, meet with a half dozen until you find one that puts together a proposal you like. For him to offer you one investment for your entire portfolio is just lazy. (Unless you have undisclosed millions and this is not that big of a deal.)
1) Variable annuities can have a valid place in a portfolio. Allianz is one of the more expensive. If you are serious about guarantees, check about Protective, or possibly Lincoln or John Hancock. They pay the advisor less; but, usually have the best guarantees and the least fees. Don’t let him give you anything about the company: they are all decades old and very stable. Also, at that level, ask about an “A” share annuity. It will save you a mountain of fees; but, he gets much lower trails. Many advisors will not even offer them under the guise of having to pay for it. I know Edward Jones does, I have heard Merril Lynch and some of the other big houses have started to make them available as well.
2) Most financial planners will tell you that no more than 1/3 of your retirement assets should be in a variable annuity. You usually do not need the guarantees they provide. (Believe it or not, the market actually works and a good money manager can actually grow your wealth in these periods!) Consider 1/3 Variable annuity, 1/3 good mutual funds in a balanced portfolio, 1/3 other including CD’s, fixed annuities, bonds, dividend paying equities etc.There will be market fluctuation; but, you will probably have the rising income supplement you need in retirement.
October 20, 2009 at 8:15 PM #471727ParticipantMeet with a different Financial Advisor. Hell, meet with a half dozen until you find one that puts together a proposal you like. For him to offer you one investment for your entire portfolio is just lazy. (Unless you have undisclosed millions and this is not that big of a deal.)
1) Variable annuities can have a valid place in a portfolio. Allianz is one of the more expensive. If you are serious about guarantees, check about Protective, or possibly Lincoln or John Hancock. They pay the advisor less; but, usually have the best guarantees and the least fees. Don’t let him give you anything about the company: they are all decades old and very stable. Also, at that level, ask about an “A” share annuity. It will save you a mountain of fees; but, he gets much lower trails. Many advisors will not even offer them under the guise of having to pay for it. I know Edward Jones does, I have heard Merril Lynch and some of the other big houses have started to make them available as well.
2) Most financial planners will tell you that no more than 1/3 of your retirement assets should be in a variable annuity. You usually do not need the guarantees they provide. (Believe it or not, the market actually works and a good money manager can actually grow your wealth in these periods!) Consider 1/3 Variable annuity, 1/3 good mutual funds in a balanced portfolio, 1/3 other including CD’s, fixed annuities, bonds, dividend paying equities etc.There will be market fluctuation; but, you will probably have the rising income supplement you need in retirement.
October 20, 2009 at 8:15 PM #472087ParticipantMeet with a different Financial Advisor. Hell, meet with a half dozen until you find one that puts together a proposal you like. For him to offer you one investment for your entire portfolio is just lazy. (Unless you have undisclosed millions and this is not that big of a deal.)
1) Variable annuities can have a valid place in a portfolio. Allianz is one of the more expensive. If you are serious about guarantees, check about Protective, or possibly Lincoln or John Hancock. They pay the advisor less; but, usually have the best guarantees and the least fees. Don’t let him give you anything about the company: they are all decades old and very stable. Also, at that level, ask about an “A” share annuity. It will save you a mountain of fees; but, he gets much lower trails. Many advisors will not even offer them under the guise of having to pay for it. I know Edward Jones does, I have heard Merril Lynch and some of the other big houses have started to make them available as well.
2) Most financial planners will tell you that no more than 1/3 of your retirement assets should be in a variable annuity. You usually do not need the guarantees they provide. (Believe it or not, the market actually works and a good money manager can actually grow your wealth in these periods!) Consider 1/3 Variable annuity, 1/3 good mutual funds in a balanced portfolio, 1/3 other including CD’s, fixed annuities, bonds, dividend paying equities etc.There will be market fluctuation; but, you will probably have the rising income supplement you need in retirement.
October 20, 2009 at 8:15 PM #472163ParticipantMeet with a different Financial Advisor. Hell, meet with a half dozen until you find one that puts together a proposal you like. For him to offer you one investment for your entire portfolio is just lazy. (Unless you have undisclosed millions and this is not that big of a deal.)
1) Variable annuities can have a valid place in a portfolio. Allianz is one of the more expensive. If you are serious about guarantees, check about Protective, or possibly Lincoln or John Hancock. They pay the advisor less; but, usually have the best guarantees and the least fees. Don’t let him give you anything about the company: they are all decades old and very stable. Also, at that level, ask about an “A” share annuity. It will save you a mountain of fees; but, he gets much lower trails. Many advisors will not even offer them under the guise of having to pay for it. I know Edward Jones does, I have heard Merril Lynch and some of the other big houses have started to make them available as well.
2) Most financial planners will tell you that no more than 1/3 of your retirement assets should be in a variable annuity. You usually do not need the guarantees they provide. (Believe it or not, the market actually works and a good money manager can actually grow your wealth in these periods!) Consider 1/3 Variable annuity, 1/3 good mutual funds in a balanced portfolio, 1/3 other including CD’s, fixed annuities, bonds, dividend paying equities etc.There will be market fluctuation; but, you will probably have the rising income supplement you need in retirement.
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