Annuity Rates
"Beware...It' Not The First Year That Matters"
Be careful when it comes to annuity rates.  Let's discuss this in a couple different contexts.

First and foremost, when it comes to fixed annuities, there are several different types of these vehicles.  Some fixed annuities have one rate for the entire period.  Others reset each year.  It is wise to know which type yours is and to know WHAT RATE YOU ARE GOING TO GET throughout the entire holding period.  If it is going to change, you must know what the minimum guarantee is.  If it's a consistent rate, it's important to know if you are getting a bonus the first year that makes it seem like your rate is going to be higher than what it is.

And speaking of the bonus (which we will talk more about),  how is the insurance company going to make up for that bonus?  Rates can lure you in and get you stuck in an annuity that becomes very highly unprofitable.  Some insurance companies are notorious for sucking you in with an attractive first year rate but then renewing at low rates for the rest of the contract.

When it comes to variable annuities, one usually sees a hypothetical example of what an annuity would have earned over the last 10 years.  This can be very deceiving.  Why?  Because 'PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.'  Therefore, you may be seeing something that will never come true for you.  Also, you may be seeing a hypothetical without the fees.

Rates can be tricky.  There are many ways numbers can deceive you and it's important that you know the facts.

To learn more about annuity rates, please go to AnnuityMD.com.


Back to AnnuityMD.com

Other Annuity Rates Resources

Legal Information
Annuity Links
Annuity Resources

The Whole Truth
Annuity Blog