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.)