One of the selling points of annuities is that they are tax diferred. However, insurance companies sell annuities within tax diferred retirement accounts such as 401k, 403b, IRAs, etc.. Although they are stated as offering added value, they are added profits for these companies.How can I get out of this annuity based 403b, because they carry a surrender charge. Being new to this, I did not know about annuity, and the surrender charge was not explained to me. I am a teacher, and the 403b investment is returning about 7% annually, well below the Index 500. The school system where I teach offer only Mutual Funds based investment for our 403b. Any suggestions?TKG
Some 403b annuities perform very well. So you may look into TIAA CREF as a possible sponsor for your plan. Your choices in the 403b are probably restricted. You may have to get your school system to make the change. Ask them to find a better program.
<< So you may look into TIAA CREF as a possible sponsor for your plan. Your choices in the 403b are probably restricted. >>I've been in TIAA CREF for 30 yrs. The average interest on the annuity portion for me will be 7%. But there are some issues that aren't very clear until you retire.Both TIAA and the employers place restriction on your ability to rollover the annuity into a self-directed IRA. In my case, two institutions contributed to my pension. The first one (only 1/3 of my accumulation) will allow me to rollover the entire amount. The second one will only allow me to rollover the amount I contributed but not the institution's contribution. In both cases, TIAA further limits it by requiring that the rollover occur over 10 years.
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