No. of Recommendations: 1
High fees, low flexibility and 'horrendous' tax treatment make variable annuities less attractive than ever, except to the people who sell them.

I am finally convinced to move my investments.

I had a great financial advisor. She moved to the credit union, along with my account. A year ago she retired. I chatted with her replacement and he shared the same investment philosophy as I had. He retired, and now the head of the "financial services" at the credit union has my account.

What finally convinced me to move my funds to Vanguard and out from under her advice? She told me lies to try to get me to buy a high-priced, under-performing variable annuity in a tax-favored account of all things, and tried to get me to move some of my emergency fund to a municipal bond fund with a load fund family other than where I have the rest of my taxable investments (no benefit of the three pricebreaks I have with my taxable investments fund family).

If I am not going to benefit from expert advice from the 12b-1 fees and front loads I pay, why should I pay them just so I can be sold variable annuities, or rather high-expense, under-performing variable annuities in a tax-favored account?

Now, to bring a little balance back, my 403(b) is invested in what are technically variable annuities inside a tax-favored account, but then I was very fortunate to have TIAA-CREF be one of my employer's "approved" 403(b) providers. (It would have been better to have Vanguard as a 403(b)(7) provider, but that isn't the case for my current employer.)
Print the post  

Announcements

The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement