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My dad purchased a variable annuity for me about 3 yrs ago. He has consistently contributed to this account. I'm about to get out of college (for the 2nd time) and he has discussed turning 'ownership' of the account over to me after graduation. He started it as a way to pass on inheritance dollars now as a way to minimize inheritance taxes later. However, I've been a religious visitor of the Fool website and I know the annuity does not provide me the best investment growth. I have over 30 years to retirement and would like to convert (cash out) the annuity to begin investing in stocks (or to fund my short-term savings, which is very low thanks to Texas Tech University).

1. How do I convert/cash out an annuity?
2. What tax penalties will I encounter? I know these will be large considering the short time frame. However, I feel like it is a small price to pay now, and collect the large rewards later from Foolish investments.
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