Why We Aren’t Fond of Annuities
Annuities are something of an open discussion among financial planners and California fraud attorneys. While many believe that annuities have become a major vehicle for potential elder abuse and scam artists, others argue that they have redeeming qualities that can make them useful for planning retirement finances. So let’s take a look at the debate, and we’ll explain why we don’t like annuities.
Let’s start at the beginning. Annuities can be incredibly pricy financial products, especially when you factor in the hidden fees, liquidity costs and sizeable commission your broker is taking (more on those later). Expensive isn’t always bad: if you’re buying a car, you don’t want to skimp on the safety features. But annuities charge more than what they are offering is worth, and often, they won’t tell you about cheaper alternatives that would benefit you but earn the salesperson a smaller commission. That takes us to item 2…
Annuities can sometimes be sold by unscrupulous individuals using unscrupulous methods. One major method is Free Lunch seminars, where they try to rope in as many elderly customers as possible and frighten them with the possibility of losing their life savings, collect their information, and make house calls to sell expensive annuity products. Sometimes they fail to disclose accurate information about the annuities value and instead substitute rose-tinted “projections” that only display the best outcomes. After you’ve purchased an annuity, you may also find that it contains…
Nobody likes finding out they’re paying for something they never knew cost money. With annuities, unless you bring your microscope to read the fine print, you may end up getting a policy that charges you for things you would assume would be free. For example, withdrawing money. A lot of annuities charge fees for “liquidity,” essentially a penalty for having an emergency that you have to use your annuity for. Having your funds tied up is bad enough, but depleting them through fees makes it even worse.
It’s important to look at all the evidence before you make a major financial decision. If you’re feeling pressured to buy, it’s a good sign that your broker is the one planning on making money of this annuity, and it may end up hurting your financial future. There are a lot of options for retirement finance, and it may be that an annuity is the wrong answer to your situation.
Major sellers of Annuities Include:
- Transamerica Life Insurance Company
- John Hancock Life Insurance Company
- Prudential Life Insurance Company
- Metlife Investors USA Insurance Company
- Genworth Life Insurance Company
- ING USA Annuity and Life Insurance Company
- Lincoln Benefit Life Company
- Metropolitan Life Insurance Company
- Unum Life Insurance Company of America
- Reliastar Life Insurance Company
If you feel that you may be the victim of an improperly sold or administered annuity, contact a San Francisco securities fraud lawyer at the Evans Law Firm by calling (415) 441-8669 or emailing email@example.com. The Evans Law Firm in California handles annuity, insurance and banking fraud, financial and physical elder abuse, nursing home abuse, and healthcare fraud.