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

What Happen To Annuities When You Die?

What happens to annuities when you die? 99% of all annuity products offer a full death benefit of the account value, or sometimes even more than the account value. I know of at least two annuities that increase your day one death benefit up to 100% of the premium and continue to grow that death benefit perpetually at a multiple of the account value growth. Without any fee, and no medical underwriting. There is only one kind of annuity that can significantly rob your beneficiaries of a death benefit. And it’s called a single premium immediate annuity, also known as a spear.

If purchased with a life only payout, nothing goes to your beneficiaries if you die. A financial professional that is skilled in laddered, inflation, hedged, guaranteed income strategies would almost never offer this type of annuity to their client.

There are very limited circumstances where it might make sense, but it’s rare. If someone is offering you a spear, you should contact us immediately because you can unintentionally disinherit your loved ones.

If you’ve already purchased a spear, you need to contact us to have a legacy rescue strategy that can potentially get all the money your beneficiaries will lose, possibly even more than they would lose back to them tax-free. Sometimes an annuity can provide a better death benefit option then life insurance, but we would need to look at your specific situation to determine that.

If you’d like a complimentary legacy review, schedule your complimentary consultation now. We will review all of your beneficiary designations on all of your investment accounts and insurance policies. To make sure your money goes where it’s intended. Upon passing away.

Have general retirement or financial planning questions we encourage you to contact us to see how we can help make sure your future is secure.