July 18, 2008
I want to make this very simple. With a variable product you can lose principal because of market fluctuations and their are no guarantees that It will ever pay more than what was invested.
Fixed Indexed Annuities you can never lose principal and if held long enough it will ALWAYS show a profit. That is why they are called fixed.
Both can lose money due to surrender charges, thus making it a non-factor
Finally, please clean up your own house before trying to clean up othrs. I know of Registered Reps who are arranging for their elderly clients to have a friend do a Reverse Mortgage so they can take those funds and put the funds in the stock market.
Also Mutual Funds require a Gold Guaranteed Signature to transfer funds to anothre company- Which they can only get at a bank or an Office paid for by a brokerage company which hinders a client to move their money to safety. The U.S. Governtment accepts a noterized signature but the fund companies do not. The fund company will however send a check in the mail if you request an account closure or partial redemtion of funds. Anything to make it harder to withdraw funds, and keep the money working for the client by losing interest.