Newsweek's Jane Quinn on VAs
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Any of you read that column on this week's Newsweek?
She basically says Annuities are bad and her back up this week was an "insider" who wished to remain anonymous (probably because he/she makes a living off selling them) says they're bad.
I'm not lying. That's what she says. An insider says they're bad. Oh and the only way to grow your income is if the underlying asset allocation or investments performs at least 8% consisently which is "nearly impossible".
If people really want to attack the VA, I'm all for it (though I'd much rather Indexed annuities get the real attention) but at leasy have some common sense to back it up. Her argument was about as deep as saying "mutual funds are bad...because they might not perform"
people love bashing annuities...they are an easy target. it's like anything else, they work well for people in certain situations. but unfortunetly some advisors over sell/use them.
you would expect more jounalisit integrity from a publication like newsweek
I've never seen a situation where a VA works well.
Ok, let's hear it from the annuity gang...
[quote=EDJ to RIA]
I've never seen a situation where a VA works well.
Ok, let's hear it from the annuity gang...
[/quote]
That's probably because you haven't been in the business long enough.
[quote=EDJ to RIA]
I've never seen a situation where a VA works well.
Ok, let's hear it from the annuity gang...
[/quote]
I have.
[quote=EDJ to RIA]I’ve never seen a situation where a VA works well.
Ok, let's hear it from the annuity gang...[/quote]
Rather than educate you, we'll just keep taking those accounts where a VA works well...
It seems like it is a matter of free choice, unresolvable. Companies have the freedom to manufacture a product, reps to disclose and sell, consumers to choose. And we know what the market is doing - annuity sales are booming, and a lot of folks are making money dissing them. There you have it. What we think almost doesn’t matter.
[quote=EDJ to RIA]
I've never seen a situation where a VA works well.
Ok, let's hear it from the annuity gang...
[/quote]
never? let me guess you use wrap accounts...
[quote=EDJ to RIA]
I've never seen a situation where a VA works well.
Ok, let's hear it from the annuity gang...
[/quote]
If an average annual return, net of ALL fees, of 25% compared to 17% on the S&P 500, over the exact period is not working well, then I haven't seen one either.
[quote=Bobby Hull] [quote=EDJ to RIA]
I’ve never seen a situation where a VA works well.
Ok, let’s hear it from the annuity gang…
[/quote]
If an average annual return, net of ALL fees, of 25% compared to 17% on
the S&P 500, over the exact period is not working well, then I haven’t seen
one either.
That’s particularly true if you happen to know of a variable annuity whose
total expenses are lower than that of most mutual funds of the same share
class.
Annuities are not just about best returns. You can’t just compare the
return to say, a mutual fund. Sometimes people need some guaranteed
income. The right annuity will provide that for you (with decent returns).
But, I stress two things: SOME guaranteed income (not ALL of your
assets), and the RIGHT annuity - not one of these 15 year surrender
indexed annuity BS products sold to an 80 year old.
The problem is not necessarily the product, but to whom and how it is
sold. I am not a big user of annuities, but I think a well-built annuity is
appropriate in certain situations.
[quote=Philo Kvetch] [quote=Bobby Hull] [quote=EDJ to RIA]
I've never seen a situation where a VA works well.
Ok, let's hear it from the annuity gang...
[/quote]
If an average annual return, net of ALL fees, of 25% compared to 17% on
the S&P 500, over the exact period is not working well, then I haven't seen
one either.
[/quote]
That's particularly true if you happen to know of a variable annuity whose
total expenses are lower than that of most mutual funds of the same share
class.[/quote]
I think I might have one.
[quote=Philo Kvetch]Broker24, it's ALL about returns...everything we do.
All the rest is just talk.[/quote]
No it isn't. It's about meeting the client's needs. Some people need more security and will be satisfied with trading off all of the possilbe return in the market for that.
[quote=Dust Bunny]
[quote=Philo Kvetch]Broker24, it’s ALL about
returns…everything we do. All the rest is just talk.[/quote]
No it isn’t. It’s about meeting the client’s needs. Some people need more
security and will be satisfied with trading off all of the possilbe return in the
market for that.
[/quote]
Then why don’t they just buy CDs and be done with it?
No, they come to us because there’s an element of greed there. If you don’t
believe it, just try delivering a few years of 1 or 2 percent returns and see
how long the relationship lasts.
I have to agree with Dust Bunny on this one. Nobody is saying that clients don't want higher returns. They all do. This just isn't usually their primary goal.
[quote=anonymous]
I have to agree with Dust Bunny on this one.
Nobody is saying that clients don’t want higher returns. They all do. This
just isn’t usually their primary goal.
[/quote]
It’s not? Then why do they come to see us?
They want help accomplishing their financial goals. Accomplishing goals often means taking less risk and getting lower returns.
Protection goals certainly have nothing to do with getting higher returns. This is why my clients buy lots of life and DI insurance.
With retirement planning, it's about putting together a portfolio that the client won't outlive. You can have 2 clients with the exact same amount of money and the same retirement goals. One client can get a higher rate of return on their money, yet still run out of money first because of volatility.
The fact that one needs returns does not equate to "it's ALL about the returns"
If it was all about returns, wouldn't clients simply be looking for money managers and not financial advisors?