View Poll Results: Should we drop the subject of variable annuities?
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Keep yakking about VAs
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59.26% |
Drop the subject
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33 |
40.74% |
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11-06-2008, 12:27 PM
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#61
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Thinks s/he gets paid by the post
Join Date: Nov 2007
Posts: 1,052
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Quote:
Originally Posted by REWahoo
Hey, you're the one who sold his soul to the devil gave up your sense of humor to sell annuities. Occupational hazard I suppose...
EDIT: Mods, please don't close this thread. I'll stop engaging Art in witty repartee, I promise...
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Ohhhh, you're posting about the devil. So I guess you were an exorcist?
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11-06-2008, 12:32 PM
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#62
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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11-06-2008, 12:50 PM
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#63
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Let's get this back on track. What are the pros and cons of VAs?
I can think of a lot of cons, expensive, commission fees, surrender of principal, poor returns.
I have TIAA VAs and these seem to be out of the ordinary for VAs having no commissions and expense ratios around 0.5%. Also the TIAA Traditional Annuity is a good option for the fixed income portion of a portfolio eliminating the requirement for a CD ladder.
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11-06-2008, 12:52 PM
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#64
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Moderator Emeritus
Join Date: Dec 2002
Location: Oahu
Posts: 26,860
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Quote:
Originally Posted by FinanceDude
Good idea.
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Are you someone with a vested interest or someone who can knowledgably write about VAs? Because it's quite possible that the two categories are mutually exclusive... and you're sounding like a volunteer!
Quote:
Originally Posted by REWahoo
Hey, you're the one who sold his soul to the devil gave up your sense of humor to sell annuities.
EDIT: Mods, please don't close this thread. I'll stop engaging Art in witty repartee, I promise...
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I'm thinking more Rodney Dangerfield than Ed McMahon, although there's a good bit of schadenfreude irony from a guy who earns millions making people laugh and then can't manage to handle his own money.
But judging from the carpet-bombing of this thread, you're just driving up Art's post count...
__________________
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Co-author (with my daughter) of “Raising Your Money-Savvy Family For Next Generation Financial Independence.”
Author of the book written on E-R.org: "The Military Guide to Financial Independence and Retirement."
I don't spend much time here— please send a PM.
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11-06-2008, 12:55 PM
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#65
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Moderator Emeritus
Join Date: May 2007
Posts: 12,901
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I have a VA, and this is by far my worst "investment". The screams I hear everyday are the sounds of my returns being eaten alive by fees, the investments inside the VA are murky and underperforming at best, I can't take my money out without paying huge penalties, etc... I made a terrible mistake when I bought it. I was stupid, stupid, stupid...
But if people want to keep talking about it, then fine, knock yourselves out...
P.S.: I am trying to compute the actual annual return on my VA money since I started it in 2001. I have been busy entering the data for the past 7 years in Quicken. I will report here soon...
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11-06-2008, 01:04 PM
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#66
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Quote:
Originally Posted by FIREdreamer
I have a VA, and this is by far my worst "investment". The screams I hear everyday are the sounds of my returns being eaten alive by fees, the investments inside the VA are murky and underperforming at best, I can't take my money out without paying huge penalties, etc... I made a terrible mistake when I bought it. I was stupid, stupid, stupid...
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What VA is it, what are the fees etc.
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11-06-2008, 01:14 PM
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#67
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Moderator Emeritus
Join Date: Oct 2007
Location: Portland
Posts: 4,946
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Quote:
Originally Posted by Martha
I have tried to draft people who don't have a vested interest in the product to write a FAQ. No luck so far. Anyone interested, pm me.
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Heh, heh... This should be good for a massive blast from the annuity sales team, or at least some litigation for revealing Trade Secrets.
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11-06-2008, 05:52 PM
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#68
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Thinks s/he gets paid by the post
Join Date: Oct 2006
Posts: 4,629
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I think the notion of "free speech" is based on the practical observation that we learn more if we let everyone talk.
Notice that even though everyone can talk, nobody is obligated to listen.
No reason to prohibit discussions of financial products. If reading the discussion is a waste of your time, then skip those threads.
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11-06-2008, 05:55 PM
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#69
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Moderator Emeritus
Join Date: Feb 2004
Location: minnesota
Posts: 13,228
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Quote:
Originally Posted by Martha
I have tried to draft people who don't have a vested interest in the product to write a FAQ. No luck so far. Anyone interested, pm me.
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I have a volunteer!
__________________
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No more lawyer stuff, no more political stuff, so no more CYA
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11-06-2008, 05:56 PM
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#70
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Quote:
Originally Posted by Independent
No reason to prohibit discussions of financial products. If reading the discussion is a waste of your time, then skip those threads.
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Spam away, then. But in that case I may take the "not listening" part to the point of departure.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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11-06-2008, 08:27 PM
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#71
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2008
Location: No fixed abode
Posts: 8,765
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I am reading a book by Ed Slott - The Retirement Savings Time Bomb and How To Defuse It. I respect him for the most part. He mentioned that in his opinion there is a good reason to have VAs within a tax defered IRA. However, he hasn't explained it yet. If this thread is still active when I get the explaination I'll post it.
__________________
"Good judgment comes from experience. Experience comes from bad judgement." - Anonymous (not Will Rogers or Sam Clemens)
DW and I - FIREd at 50 (7/06), living off assets
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11-06-2008, 09:53 PM
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#72
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Thinks s/he gets paid by the post
Join Date: Dec 2007
Posts: 4,764
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What type do you like?
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11-07-2008, 12:57 PM
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#73
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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Quote:
Originally Posted by Martha
I have a volunteer!
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Yea!! I'm off the hook Nords tried to put me on.......
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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11-07-2008, 08:29 PM
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#74
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Moderator Emeritus
Join Date: May 2007
Posts: 12,901
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Quote:
Originally Posted by nun
What VA is it, what are the fees etc.
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Our VA is in an IRA and was opened in mid 2001 by our friendly Ameriprise FA. If I remember correctly fees are around 2-3% a year.
OK, well the VA's returns were actually pretty easy to compute because we invested a lump sum in mid 2001 (Rollover IRA).
Doing XIRR on the VA, I get, as of yesterday, an annual return of -1.2% since I opened the account.
The money has been allocated as follows (no change since 2001): 30% equity income, 20% small cap, 20% mid cap, 20% large international and 10% REIT (in other words, the money is invested 100% in equities).
Had the money been invested at Vanguard (VG equity income, VG small cap index, VG mid cap index, VG total international index and VG REIT index), the money would have returned +2% annualized between mid 2001 and yesterday (I used total return data from Morningstar to compute the return).
So on average, by investing inside a VA, my average annual return has been 3.2% lower than it would have been at Vanguard.
How much of a difference would that make?
$10,000 invested at Vanguard in 2001 would be worth $11,486 today.
$10,000 invested in the VA in 2001 would be worth $9,129 today (20.5% lower than the $11,486 at Vanguard).
So effectively the VA's high fees have wiped out any potential gains. In a rapidly appreciating market environment high fees may be easier to swallow, but in a flat-ish market environment, high fees are killers!
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11-07-2008, 08:53 PM
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#75
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Thinks s/he gets paid by the post
Join Date: Sep 2008
Posts: 2,171
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What's the most frequently asked question—how & when can I get outta this thing without the surrender charge eating me alive?
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11-08-2008, 07:45 AM
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#76
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Thinks s/he gets paid by the post
Join Date: Mar 2006
Location: Houston
Posts: 4,337
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Quote:
Originally Posted by FinanceDude
Did you ever get your answers?
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Not really. My sister is clinging to her story that it has to come out in her name and on her SS number. My other sister thinks the same way I do and lives not far from her. I'm sure she'll get more involved before the payout date.
This will either be next month or January. Of course, that's tentative because my sister controls when.
This annuity (yes, 2B has a VA ) is with American General Life Insurance Company (a subsidiary of American General - what a surprise). I have a form dating from 2000 that supposedly changed the ownership to all of us.
My father originally had it set up with only my youngest sister as beneficiary thinking that she was "in charge" but only part owner. She had all of his POA and financial stuff so it was a natural extension. When he realized he set it up wrong it was changed.
I intend to call the number of the FA (may he burn in hell) that sold the VA to my father. He may actually be fulfilling my wish but he could still be there. If not, someone else may be able to help.
__________________
The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane -- Marcus Aurelius
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11-08-2008, 08:02 AM
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#77
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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The VAs offered by TIAA-CREF seem to be very different from the horror story you describe; low fees and lots of options. Is TIAA-CREF turly a reasonably priced, good performing VA or am I missing something
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11-08-2008, 08:31 AM
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#78
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Thinks s/he gets paid by the post
Join Date: Mar 2006
Location: Houston
Posts: 4,337
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Quote:
Originally Posted by nun
The VAs offered by TIAA-CREF seem to be very different from the horror story you describe; low fees and lots of options. Is TIAA-CREF turly a reasonably priced, good performing VA or am I missing something
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If your choices are like my daughter's 403b TIAA-CREF options, it's all in the fees. The annuity has a fee although modest compared to many alternatives and the mutual fund choices inside the annuity have high fees. The only thing you are missing is the money. You can either have a higher return with index funds or fund TIAA-CREFs end of year bonus.
__________________
The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane -- Marcus Aurelius
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11-08-2008, 09:06 AM
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#79
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Moderator Emeritus
Join Date: May 2007
Posts: 12,901
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Quote:
Originally Posted by nun
The VAs offered by TIAA-CREF seem to be very different from the horror story you describe; low fees and lots of options. Is TIAA-CREF turly a reasonably priced, good performing VA or am I missing something
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Good for you!
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11-08-2008, 10:52 AM
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#80
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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Quote:
Originally Posted by nun
The VAs offered by TIAA-CREF seem to be very different from the horror story you describe; low fees and lots of options. Is TIAA-CREF turly a reasonably priced, good performing VA or am I missing something
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TIAA-Cref is fine their expenses are low. I don't think ANY VA or ANY MF is performing well now........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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