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Very Off-topic: Annuities

edited May 2014 in Off-Topic
I'm lucky to still have my wife. Big car fire. STUPID worthless g-d squirrel or other critter built a nest under the hood of the car. Wife is unhurt. Insurance. Insurance run-around. Insurance pencil-necks. STUPID insurance questions. Moot insurance questions. Redundant insurance questions..... And information? Lacking. Actually incorrect "information." Forgotten information. Never-communicated information. Leave the customer scrambling to play a game. Screw the customer. All of which made me stop to wonder: how many OTHER people's jobs do I need to do, for something to happen, and happen properly? All asking me to repeat the same thing, or giving me different responses to the same question, telling me of different requirements in order to finally get the insurance check. No real agent, because State Farm doesn't want to be doing business in Massachusetts....

I was referred to an insurance agent with whom I spoke and visited, and he was helpful, direct, accurate. I will be moving my business to HIM! ...Anyhow, he does investments, too. He uses "guaranteed" annuities to protect clients' money, so he says. He protects from losses by buying/selling OPTIONS.

This doesn't sound like a real guaranty--- like the FDIC is a guaranty. I do not know anything about annuities except that the one who is peddling an annuity to a potential customer stands to collect large fees. And I understand that you can buy a lifetime annuity or an annuity for a specific term.

"Guaranteed," he said. It can only go up. Protection from losses are built-into the way he structures and uses them. I'm not going to use his investment services. It all sounds TOO conservative, too airtight, too cookie-cutter-ish to me.

I listened to him and nodded, and I did volunteer to say---when he told me he aims for a long-term gain of 4-6%--- that such a range seemed realistic and healthy to me. But I kept asking myself: how would this sound if construed and explained differently? We have straight-shooters here in MFO. If you will, tell me what you think of the "line" he took with me. Thanks. By the way, it was myself who opened the conversation about his investment services, not him.

Comments

  • I am not sure what he means by guaranteed. Annuities are like mattresses. They vary a lot from one to another. But their main tag line is that they provide a guaranteed flow of income according to the term. That guarantee may come at a big cost, of course. Not sure what he is peddling. If he is managing a portfolio of annuities and other instruments to guarantee a return, ask him to give you the terms of that guarantee in writing and you will see what that guarantee really means.

    Don't do business with anyone that says something is guaranteed. Never trust an insurance agent to do portfolio management.
  • edited May 2014
    "It can only go up"
    Stop right there. Anyone selling balloons, airplanes, or any financial product who utters that sentence is either ignorant or wicked. Take your pick.
  • edited May 2014
    @Crash

    Annuities have been discussed numerous times over the past few years here at MFO.

    The new and improved MFO site does offer a very decent search. Search the word, "annuities" or "annuity" to discover which discussions contain the word for your further review; that may benefit.

    Lastly........these plans all have an identifing name. Do you recall the name of this "guaranteed" plan? One should be able to define some info about the plan via an online search.

    Glad your wife is without harm with the auto event.

    Take care,
    Catch
  • Thank you, guys! Yes, the decision has already been made. My investments will certainly not be put into HIS hands.
  • The user and all related content has been deleted.
  • You are absolutely correct, Maurice. Unless you're caught in a Catch-22. Which the entire System is. My friend once said: "They're not in the business of insuring you. They're in the business of taking your money." It came to him, after a stinky experience, many years ago. I have to agree.

    But in "buying direct," you're on your own, navigating the maze of bullshit requirements in order to jump through the proper hoops---- even to find out WHICH, in fact, ARE the proper hoops. And it doesn't help when you are told something over the phone, then you receive a pile of papers and forms through the mail to be filled out....

    ...When I met and spoke with that agent, he cut through the feces. The forms mailed to me were in fact redundant by now. Those bases had already been covered. And he knew what to do in order to take my one remaining license tag out of circulation, in order for me to get a rebate on my annual excise tax paid on the car. (The other tag was burned up in the car fire.) State Farm said nothing about that at all. Because what they know how to do would not fill a thimble. (The best, funniest, most idiotic line, always, always asked when you get on the phone with them is: "Are you a State Farm policyholder?".......No, I just thought I would dial your number out of the clear blue sky and see what I come up with--- so that I can waste your time and mine in the most egregious way possible, because I'm a total buffoon. Chewing on my own toes would be a better use of my time, but I chose to randomly call you, instead--- you blithering idiot!)

    Buying direct is cheaper. Buying a policy from an actual person-an Agent- is more expensive. But if you want any real help when the time comes, it's the price you have to pay. Dammit. Dealing with the aftermath of a car fire is a real trial. Especially with no one to guide you. State Farm bites IT.
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