Why Variable Annuity Popularity May be Increasing

I’ve noticed an increasing number of people contacting me about variable annuities lately. I think this can be explained by a fear increase among investors. In the past investors may have been willing to forego a guaranteed income stream for the chance at having substantially more assets during retirement. That mentality made sense at a time when the stock market averaged 10-12% growth per year and government entitlement programs were well funded. But during this ‘lost decade’ investors find themselves clinging to cash and prioritizing guaranteed income over growth. Variable annuities actually offer both which is probably why investors are asking questions.

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Comparing & Contrasting Variable Annuity Riders

As most of my readers know, my blog is designed to inform clients about issues related to financial planning, investment products, and the economy. Lately I’ve been fielding more questions than usual about the various annuity products out there and which ones are best, the worst and potentially the most interesting. It’s also no surprise that variable annuity features and riders change frequently to correspond to changing market conditions and current client needs. It would be nearly impossible for the average investor to be fully informed about the differences between variable annuities offered by Prudential, Jackson National, Nationwide, AXA, Sun Life, Transamerica, etc. Well, this post should provide some clarity and also give you insight into how the insurance companies think about and price these products.  Note: While some of the information below is still accurate, the various annuity riders and pricing have changed over the past few years. If you are looking for product specifics which are accurate for 2013 forward, please send me an e-mail or give me a ring.

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