“Why should I buy an annuity when I don’t need all those extra features?”
Fact: There are simple, low-cost, unbundled variable annuities that are focused on maximizing long-term accumulation.
There is no end to new annuity features—such as riders for guaranteed minimum accumulation benefits, guaranteed minimum withdrawal benefits, guaranteed minimum income benefits and long-term care insurance benefits. But the costs for these riders are generally asset-based fees that can take a sizable chunk of your returns and diminish the growth potential of the underlying investment.
Many financial products are becoming increasingly complex. But many experts believe that attempting to bundle a variety of different features into a “one-size-fits-all” product may not be the most effective solution. It may actually limit your flexibility and may drive up costs.
It is critical to pin down your specific goals and evaluate the appropriate products that can help you meet each of your goals in the most effective and efficient manner. In many cases, you may find that simple, low-cost, unbundled products are a better way to meet your different financial goals
If you are looking for the most cost-effective method for long-term retirement savings, look for simple, low-cost, unbundled variable annuities that eliminate costly asset-based fees and complicated riders to help maximize the power of tax-deferral.
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03-31-2009, 01:04 PM
