A Variable Annuity that Works

M

Mysto

Recycles dryer sheets
Joined
Mar 13, 2006
Messages
206
From 3 strategies to guarantee income in retirement - Sep. 21, 2009 This is the way to make a
variable annuity work - just have 150%!

chart_how_long.gif
 
REWahoo said:
Even investing 100% in annuities and the other 50% in stocks and bonds you only have a 92% chance... :)
Click to expand...

:2funny: Yes, especially if your state only guarantees the first $100,000 of an annuity in the event the company offering it craters before you are 95.
 
Why would someone conclude the variable annuity works when you can increase the chances of success from 92% to 99% by replacing it with an immediate annuity?

I have some reservations about these calculations, but even if I accept them at face value, it seems like all this is doing is telling us that an immediate annuity is better than a VA. And it doesn't account for the chance of an insurer to fail and it doesn't account for people who want to preserve capital to pass to their heirs.
 
ziggy29 said:
Why would someone conclude the variable annuity works when you can increase the chances of success from 92% to 99% by replacing it with an immediate annuity?

I have some reservations about these calculations, but even if I accept them at face value, it seems like all this is doing is telling us that an immediate annuity is better than a VA. And it doesn't account for the chance of an insurer to fail and it doesn't account for people who want to preserve capital to pass to their heirs.
Click to expand...
Uh... Ziggy. Re-read the thread (especially the arithmetic) with your sarcasm radar turned up a notch ;).
 
ziggy29 said:
Why would someone conclude the variable annuity works when you can increase the chances of success from 92% to 99% by replacing it with an immediate annuity?
Click to expand...
You need more income than Social Security and pensions will provide, but you want access to more of your savings than Strategy 2 allows.
Click to expand...
"I'll go broke eight times as often, but look at how much more money I'll have!"*

ziggy29 said:
I have some reservations about these calculations...
Click to expand...
150% of the people who make these math errors suffer a 200% loss of credibility... 92% of the time.

* This endorsement has been brought to you by the Variable Annuity Sales Association. Remember to check out our equity-index products, too!!
 
Immediate annuities right now only pay 4-5 % not 8%. Big difference. I just checked last month for a joint IA for wife & myself.
 
Mysto - Many thanks for revealing the secret of making 100% --> 150%. All I have to do is make a pie-chart with four sections!

I'm going to get to work on it right away. I'm gonna make one apple, one cherry, one...
 
sailfish said:
Immediate annuities right now only pay 4-5 % not 8%. Big difference. I just checked last month for a joint IA for wife & myself.
Click to expand...

The article is correct. 65 year old male gets about 7.9%. You are right though, a joint annuity pays about 5% for the same age group.

Rich - you forgot foreign and gold - You'll need at least another 200%

Telly - I like pecan

I just posted this to show off the financial experts that all told us about the recession - right after it crashed - but they did it 800%:whistle:
 
That graphic is hilarious, Mysto--good catch! And several hours later, the 150% portfolio is still on the CNN website.
 
Bestwifeever said:
That graphic is hilarious, Mysto--good catch! And several hours later, the 150% portfolio is still on the CNN website.
Click to expand...

And I notified them right after I posted. But remember, CNN the most trusted... :cool:
 
Last edited:
Cynics. I read the literature and with the variable annuity you do get an extra 50% so there is no math error.
 
donheff said:
Cynics. I read the literature and with the variable annuity you do get an extra 50% so there is no math error.
Click to expand...
If this thread tracks with history a swarm of professional annuity salespersons will be along shortly to show us the error of our cynical thinking.
 
Telly said:
Mysto - Many thanks for revealing the secret of making 100% --> 150%. All I have to do is make a pie-chart with four sections!

I'm going to get to work on it right away. I'm gonna make one apple, one cherry, one...
Click to expand...
banana cream and lemon meringue, please. :D
 
crazy connie said:
And I notified them right after I posted. But remember, CNN the most trusted... :cool:
Click to expand...

Dear Ms. XXXXXX,
Apparently the numbers for Strategy #3 were incorrectly entered when posting the online version. The percentages for Strategy 3 on page 94 in the October issue of MONEY do indeed add up to 100%. I’ve sent a note to the online folks asking them to correct the numbers. Thanks for alerting me, and I hope I caught you before you rushed out and invested 150% of your money.
Regards,
Walter Updegrave

I plan to write back and tell him I took my HELOC and IRA and bet the farm so I could invest 3 times as much!:flowers: At least he was trying to correct it and still has a sense of humor!:whistle:

BUYER BEWARE is the rule.:facepalm:
 
REWahoo said:
If this thread tracks with history a swarm of professional annuity salespersons will be along shortly to show us the error of our cynical thinking.
Click to expand...

I don't post that often these days, but I am pretty certain I could make a special guest appearance a la PeeWee Herman on Jay Leno's show in that eventuality.
 
You must log in or register to reply here.

Similar threads

F
TIAA 2024 SP annunity
Replies
8
Views
1K
FargoI
F
F
Are variable annuities as bad as people say?
2
Replies
48
Views
5K
Koolau
Koolau
gcgang
Can you gift an annuity?
Replies
2
Views
599
gauss
gauss
G
Options for guaranteed income if you’re delaying Social Security until FRA
2
Replies
35
Views
2K
Surewhitey
S
O
What a silly article
2
Replies
37
Views
2K
Koolau
Koolau

Latest posts

Back
Top Bottom