Annuities Investment Advice

Camarda Wealth Advisory Group
Helpful Advice

As most clients know, Camarda does not typically recommend annuities. Still, this material may be helpful as a refresher, or to pass on to someone you care about. In most of the cases we’ve seen, the products are very expensive, and the high, often hidden costs, on top of very high taxation, can severely stunt wealth growth. Because annuities are often marketed heavily, and because they can be so hard to understand, you may want to learn from the tips below. If you are considering annuities, or if you already have them and would like an analysis and rescue plan, contact us to get a FREE Total Wealth Health Checkup

  • Complexity Annuities are some of the most complicated, poorly understood “investment” products on the market. These are actually life insurance policies that can pay high commissions to salespeople who are often not required to put your interests first.
  • High Taxes Annuities are taxes taxed at an investor’s highest rates. They don’t qualify for the lower capital gains rates, and capital gains are not forgiven at death. Since there is no “step up,” much more estate wealth can be lost to taxes than other investments like mutual funds, stocks, real estate, and so on.
  • Questionable Sales Practices Annuities are sometimes pushed even when they are not the best solution, especially when misleading claims of “no fees or commissions” or “I’m paid directly by the company” may hide the real cost and motives for high commission products.
  • Poor Understanding Many investors who buy annuities don’t really understand them, don’t need them, pay far too much for them, and ultimately may come to regret investing in them.
  • Are they right for you? Because of their life insurance nature, annuities can offer valuable features but these features are only worth paying for if you need them, and, depending on the annuity, can come at extremely high tax and products costs.
  • Hard to Spot Costs Commissions, product costs, and tax treatment are often not easy to find for consumers – or well explained by salespeople! – which can make smart shopping and cost comparisons nearly impossible.
  • Often the Wrong Decision And with lots of marketing hype and high commission sales pressure out there, it can be too easy to make the wrong decision – a decision you could feel stuck with for a long, long time.

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Please remember that past performance may not be indicative of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Camarda Wealth Advisory Group -“CWAG”), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from CWAG.  Please remember that if you are a CWAG client, it remains your responsibility to advise CWAG, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. CWAG is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of CWAG’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request. Please Note: CWAG does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to CWAG’s web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

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