Response: Hector asks a very good question since most people will just simply jump right in and start looking for the highest rates or are enticed by the "product hooks" (eg. bonuses, income rider rate that is often mistaken for an interest rate) vs. determining what type of annuity they should be considering and even more importantly... who they are purchasing their annuity from.
In my quest to find the right annuity for my needs the first question I would be asking any advisor with regards to annuities is "How many companies to your represent?" Simple truth is there are hundreds of companies offering annuity contracts to the public... if the advisor I'm speaking to is only contracted with a handful, what are the odds I end up with the exact annuity that meets ALL of my needs AND is the most competitive annuity available. You wouldn't deal with a securities broker who could only sell you 4 stocks or mutual funds would you? Beyond that, most consumers think that there is additional safety in purchasing their annuity from a bank or large financial institution. That my friends couldn't be further from the truth for a whole host of reasons. Typically banks and wire houses have the fewest annuity products to offer simply because there isn't enough commission in some of the most consumer oriented products to pay the whole food chain at these institutions so they can't afford to offer them. I know of one bank in Indianapolis that was offering annuities and they had ONE company available to their clients... what are the odds that one company had the right annuity solution for the thousands of people who came through their door? Virtually impossible. How many people do you think they turned away? or do you think they offered the best they have variable with their sole company?... Great question Hector... keep them coming. Watch the video to learn more!
Carl Barnowski has 25 yrs. of experience as a retirement income expert specializing in principal protected annuities.