Interested in an Annuity
I have read your writings and I follow you on WGN radio. I am an extreme low risk investor. I have used bonds and CDs for savings and investments. With horrible interest rates I now want to purchase an immediate annuity. My research led me to New York Life., They obtained for me a quote from agent Justin Woolery in Dallas Texas representing the Lourdes Martinez brokerage in Westchester, Illinois. I like their offer but in this era of fraud and scams I would like your opinion as to whether this sounds legitimate. I appreciate how busy you are but a simple yes or no would be great.,
Terry Says
No,no,no!! Glad I just saved you. First, with an immediate annuity — a check a month for life — you are locked into a fixed monthly payment. With inflation on the rise, that is a bad move. At just 3% inflation, your spending power of that monthly fixed check is cut in half in 25 years!
Second, no one sells immediate annuities. If you still want to do that, just go to www.immediateannuities.com, tell them your age, gender, state of residence and the amount you want to invest. Then they will show you the monthly amount you could receive from at least 3 top rated insurance companies.
SALESMEN FOR MOST ANNUITY COMPANIES SELL OVERPRICED PRODUCTS THAT HAVE HUGE HIDDEN COSTS AND RESTRICTIONS. They don’t bother with immediate annuities, because there are miniscule commissions built right into the yield of the annuity as described above.
So you were about to be talked into something other than an immediate annuity offering a check a month for life, or for at least 10 years, or with a death benefit (all of which lower the amount you can get each month). Probably you would have been sold an annuity “indexed” to some sort of stock market performance, with all sorts of hidden fees and caveats about how you eventually can get your money out!! (Spend $10 and get the 3rd edition of The Savage Truth on Money on Amazon, and read the annuity chapters to see how this works to make salesmen rich!)
Don’t get greedy. Rates are about to rise. Yes, you’re falling behind inflation now, but likely bank rates will jump in the future.
