Over the past few months, the largest annuity provider in the United States has been training its advisers to take advantage of the current global health crisis to sell their clients annuities. Apparently, various consumer market studies have indicated that retirees right now are particularly receptive to the promise of “guaranteed income for life.” One study found that 33% of scared retirees bought an annuity upon hearing the words guaranteed income.
This is predatory as it exploits one’s fear of economic insecurity to make a financial decision that is to the detriment of your household. And given the large sums of money often involved in annuities, the costs of the poor decision are particularly high.
Going into this year, the typical annuity provides $0.78 in cumulative lifetime value for every $1 purchased, provides $0.05 in commissions to brokers/sellers, and lasts 7.82 years. In other words, if you buy an annuity … Read the rest of this article!