Casey’s Thoughts – Fees & Investments

In a recent article on it was reported that Equitable told teachers their variable annuity fees were $0.00, SEC discovered. As a result, Equitable was charged with misleading retirement savers about hefty fees on variable annuities highlighting gaps in investor disclosures about the complex products.

“Equitable Financial Life Insurance agreed on July 18 to pay $50 million to settle SEC fraud charges alleging that it sent “materially misleading” account statements to 1.4 million annuity holders over the past six years. Equitable, a target of critics who assert the company is predatory toward teachers, a core market for the annuities industry, left out the products’ two main fees and 97% of the revenue from the contracts, the SEC said.”

I see this as another stain on an industry that doesn’t need any more help losing the trust of the public. These types of stories really hit us hard at Crown Haven Wealth Advisors because we come from humble beginnings, and we truly believe that it’s our job to ensure our clients worry less about their money and spend more time enjoying their lives.

That means those that work in the financial industry MUST be transparent. They MUST act with integrity. They MUST under-promise and over-deliver. They MUST act as fiduciaries and put YOU first.

In short, they should treat you as they would hope to be treated.

Here’s the deal: Variable Annuities have fees. Period. End of story. They have M&E fees, 12b-1 fees, administrative fees, mutual fund fees, income rider fees, etc…

Variable annuities are basically the entire reason you think “fees” when you hear the word “annuity” – because they’re literally the only type of annuity that have fees as an automatic component of the contract.

HOWEVER, That doesn’t mean all annuities are bad, and it certainly doesn’t mean all people who use the many types of annuities as a tool (out of many) to build a holistic retirement plan are as duplicitous as these folks who told these poor teachers their fees were $0.00.
It’s for this reason that it is so important to arm yourself with knowledge!

We’ve spent hundreds of hours compiling dozens of resources for the general public to consume. Learn about this commonly misunderstood retirement vehicle, as well as many other topics.

If you have more specific questions or want us to perform an annuity audit for you, reach out to us or schedule a visit – we’re here to help.

Casey Marx