Proof of how sh*tty these VA's are:
I received a hypothetical from Hartford today (Hartford Leaders product) showing the performance since 11/30/96 of their VA using the Franklin Founding Funds Strategy (for those not in the know, it's a 3 fund blend: Mutual Shares Franklin Growth and Franklin Income fundt; that is roughly allocated like a balanced fund, except with a heavy weight in high yield).
Anyway the illustration ONLY included the M&E and admin expenses, not the Optional .50 bps guarantee.
Here's the results, confirming every thing I detailed in the earlier debate:
Starting value: $125,000
VA ending value: $219,572
Annual compunding return of 6.27%
Hypothetical of JUST the funds (A shares)
Ending Value: $271,287
Annual compounding return: 8.64%
The VA ate up 2.37% in returns a year w/o the guarantee, imagine how much worse it would have been with an extra .50bps tacked on!!!
Keep in mind that this 9 year period (I asked Hartford for a 10 year hypo, I guess they're not very smart over there) also includes one of those "disasterous" markets that the guarantee is designed for. (will 2nd worst bear market in history work for you?)
Verdict: Not needed. Better off with bonds, especially with the guarantee dragging on performance.
Also, It's my understanding that Hartford is among the less expensive VA's, I could be wrong since I'm not too excited about these products.
pwn3ed, it's all I can say.
I am loving the Franklin Founding funds too. You are the only other person here who has talked about it. What are your thoughts.
Mike, you're such a douche bag I don't even know where to start.
In fact, I'm not going to...I just finished my 2006 business plan, and posting throughout the day on RR just doesn't fit in.
I intend on doing 500K this coming year (c'mon Mike, lets here how 500K is small potatoes, blah blah blah), and spending any amount of time with pikers like Mike the Butler (who works at Primerica) and Dude won't get me there.
It's a simple story, quality package with a long history. Franklin is a great company. Expense ratio is good for a fund of funds product.
Amen BankFC. I agree completely. I hope you hit your goals, we can agree to disagree on the technicalities of product, but let’s agree that at the end of the day we all should support each other in being successful. We all should spend less time here and more time doing business.
[quote=dude]Amen BankFC. I agree completely. I hope you hit your goals, we can agree to disagree on the technicalities of product, but let's agree that at the end of the day we all should support each other in being successful. We all should spend less time here and more time doing business.[/quote]
I agreed. Merry Christmas to both of you, in fact, to all of us.
I choose the FFALX one ticket drop because of simplicity. Franklin will take care of rebalancing and I suspect they are as good as I would be in this regard so why not let them do it? One thing I'm learning is that keeping it simple is important. Your question is valid though. In my opinion there is not much difference, so why not keep it simple?
As far as the other funds, they are definitely in the rock star category. I just like the simple "balanced" fund approach for a good portion of my clients in a convenient package with the nice marketing brochure which makes selling it easy.
It's hard as hell getting appointments right now. My cold calling is on ICE lately.
I also thought the Hartford bond comments showed insight.
[quote=Greenhills]I love watching midgets fight [/quote]
If nothing else, we are entertaining