Whether it’s lifetime income, tax deferral or the prospect of protection from falling markets, an annuity can sound like a good idea for many investors.
But clients ought to bring plenty of questions and some skepticism to the table before they commit.
“We know that there are people in this industry who have annuities in their bag, and if you have a hammer, everything looks like a nail,” said Skip Schweiss, managing director of retirement plan solutions and advisor advocacy at TD Ameritrade Institutional.
Generally, annuities are insurance contracts that provide investors with a stream of income in exchange for a cash lump sum up front.
From there, it gets complicated: There are different flavors of annuities, with some offering market exposure and others crediting interest