The Motley Fool Discussion Boards

Previous Page

Investing/Strategies / Retirement Investing

URL:  http://boards.fool.com/tinytone-ltltdo-you-really-think-annuities-10159336.aspx

Subject:  Re: Questions about 403(b)7 Date:  4/21/1998  9:56 AM
Author:  TMFPixy Number:  2956 of 74759

TinyTone,

<<Do you really think annuities are lousy when compared head to head with a mutual fund within an IRA?

I have a variable annuity through my 403(b) plan which invests in stocks much like a fund. I'd be interested in hearing what you think the disadvantages are compared to a mutual fund in an IRA.>>

The annuity adds an extra layer of mortality and administrative expenses. Take the same fund by itself, and all you have to affect the return is the expense incurred by the fund. Put that fund inside an annuity, and now you have the others as well. In direct competition within an IRA, the fund standing alone will beat the fund inside the annuity every time.

Regards….Pixy


Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us