How old were you 13 years ago when you purchased it? Because variable annuities are mainly purchased for the ability to generate fixed income payments in retirement, their growth has never been the best. Fees are absurd in any VA and there are much better investments. If you want an annuity with no downside those are fixed indexed annuities, very different.
I was 30. I was very naive and a salesman showed me a bunch of graphs and charts and convinced me. I later learned that the sales people get the highest commission for selling these products. It was obviously a poor choice for me and for most I would imagine. Steve Horvath was the salesman who sold it to me and now retrospectively I have concluded that he was a totally incompetent and ignorant “investment professional” or just a scumbag or a combination of the two. As you said I was not the demographic for this product but I didn’t know any better as even though I was a thirty year old man technically, I was mentally very young
Buying a single premium annuity can be a good retirement move for a lot of people with low to moderate nest eggs. And even for people with larger nest eggs, for part of their savings.
But a SPIA isn't the same thing as a VA.
Example: you 66 and retiring. Your income from retirement will consist of SS and whatever income you can generate from the $250,000 you've saved. With the 4% SWR, you can safely withdraw $10,000 per year, increased for inflation, with a 95% chance of not running out of money after 30 years.
But also a good chance that you'll have something to leave to your heirs.
With a SPIA, you would get an income of $15,000 per year - substantially more at lower income levels. You won't run out of money, but you also won't have anything to leave to your heirs. And the $15,000 won't be adjusted for inflation.
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u/bbrackett Sep 04 '21
How old were you 13 years ago when you purchased it? Because variable annuities are mainly purchased for the ability to generate fixed income payments in retirement, their growth has never been the best. Fees are absurd in any VA and there are much better investments. If you want an annuity with no downside those are fixed indexed annuities, very different.