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Investing/Strategies / Retirement Investing
|Subject: Re: Pru VA High 5 closing this week||Date: 2/10/2013 6:12 PM|
|Author: tscotta||Number: 71371 of 77323|
Remember, a VA should probably not be viewed as an investment, they are sold by insurance companies so think of it as income insurance. If your particular situation would benefit from a set amount of guaranteed income then it could be worth looking at. If you are looking at it as an investment standpoint solely - the fee drag alone makes this a different discussion and possibly not a good decision.
I do know that many good companies such as PRU have pulled products from the marketplace or made changes in such a way to make them less attractive - the low interest rate environment, reserving requirements set by the regulating bodies and other factors relating to the cost of capital have forced their hands with this. So in some instances some have viewed these VA's as a "mispriced bet" in favor of the consumer.
Your comment about not annuitizing is spot on, the way the contracts are structured there is a very limited number of reasons you would ever want to annuitize it, in fact I have been told that a very very small percentage of them actualy ever annuitize.
Again, not for everyone but they are also not your grandfathers annuities either.
One thing to consider is the amount of guaranteed income you could generate from the annuity, this strategy if done right might allow you to maybe take some more aggressive approaches with the rest of your portfolio.
Just some thoughts, but remember the basic premises with annuities, they are an insurance product, not investments. This line I think has become blurred in recent times.
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