Subject: Re: Re: Re: Re: Re: Re: variable annuities

Comments:
: Jaxxx, : I appreciate you explaning your position without calling me a fool this time. I really don't feel like arguing with someone's position when I don't know all the facts. Honestly, neither of us know the facts and if we wanted to discuss which approach to solving this problem is better, we would need to establish what the problem is and what other factors are present before we could truly say a VA is better than _____ (fill in the blank). : That being said, I do want to say a couple of quick things: : (1) I'm somewhat surprised that you put "conservative asset allocation" in the same sentance as 8%! I mean, when I illustrate a somewhat aggressive allocation for people, I tend to max out at 8%, because that's much closer to being realisitic and anything above 8% is just gravy. : (2) I feel terrible for those individuals who purchased and annuitized VAs over the past three years. Month after month they have seen their annuity payment drop, since annuity payments drop as their account value drops (hence the term variable). I know you know that's the way VAs work already, but just in case someone is reading this and thinks that VA annuity payments always go up or could never go down, please think again. Now Jaxxx, I know you used the term "systematic withdrawls," but all you're by only withdrawing your investment (in other words, leaving the gain inside the VA) is creating a tax time-bomb that has to catch up to you later on. : (3) Of course, the guaranteed death benefit does not decrease, but then again that's a feature of all types of annuities, not just VAs. So I can't necessarily consider that a major selling point. : Jaxxx, I'm not saying that a VA wouldn't work, I'm just saying that something like a fixed or indexed annuity might be more a more suitable approach. Of course, I make that statement on the assumption that the 80 year old needs the money to live off of. If the 80 year old does not, then there are lot more options to consider, INCLUDING using a VA...but it all depends upon the individual's current needs and goals. : Best of luck to you : : Let's say that an 80 years old takes systematic withdrawal. Since she has a quaranteed death benefit, she can't lose if she keeps annuity if force until she dies. Let's say she has a conservative asset allocation, but something that will give her a return of around 8% per year. She will have more spendable money, will outpace inflation, and if her account does go down, her bene. will not suffer a loss at her death. : : : Jaxxx, : : : Well, you know as well as I do that everyone is entitled to their own opinion. = ) I'd definitely be interested in listening to your opinion as to why a VA is suitable for a senior citizen. Of course, we should both agree that it's improper to make a judgment one way or another with only knowing such limited information as "are variable annuities a smart investment for an 80-year old." That is precisely why I said "without knowning any further information" and "typically not suitable" in my original response. More or less, I meant that 9 times out of 10. Perhaps this case is the exclusion to the rule, I don't know. Nevertheless, I'd still like to hear your explanation if you have the time to present it. Since I'm a "fool" that hasn't "learned anything since the last time [you] read my post," perhaps you can correct me. : : : Thank you : : : : Todd: : : : : I see you haven't learned anymore since the last time that I read your post. : : : : You say no one retired should have a VA?? : : : : What a fool! : : : : : : : : : : Without knowning any further information, it's my opinion that an 80 year-old should NEVER buy a VA. In fact, variable products are typically not suitable for people anyone who is retired. Period. : : : : : Retirees need stable/fixed income products. However, I will say this...IF the 80 year-old doesn't need the money to live on and this VA would just be an investment to leave the money to his/her heirs, there are MUCH better ways to go about it! If you have someone that's trying to sell you a VA for your 80 year-old spouse, partner, grand parent, etc... you might want to consider contacting the SEC and the State's Dept. of Insurance and reporting that individual for unsuitable sales. : : : : : : : : : : : Are variable annuities a smart investment for an 80-year-old? What things should she or her heirs be aware of to ask before investing?

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