November 17, 2008
As an agent I have been selling Fixed Indexed Annuities (FIA) for over 5 years. The reason I like them is they have the potential to out perform bank CDs without exposing my client to the down side risk of the market. I understand that all annuities have large surrender charges, but usually have 10% penalty free withdrawals (and some have more). So I make sure that the liquidity is not an issue. I do not believe that FIAs are a security, because they have no downside risk.
Also, if regualtion protected consumers, how come so many consumers are being hurt so badly by the infestments their brokers put them into? All of my clients are way ahead of their peers that were made to believe that "a well deversified portfolio" is the best way to invest. Most brokers say it is the only way.
I believe that more consumers should be taught that FIAs are far better for their retirement funds than broker accounts where they risk to lose everthing.
My clients have never lost a dime and have averaged 6% growth over the past 10 years. Broker accounts have lost 30% average over the past 10 years.
Where would you want your parents retirement savings to be?