Question: Why would anybody use a retirement plan that generates the most customer complaints according to a federal watch dog, FINRA?
Answer: Complaints or not, my profession, prek-12 teachers, sign up with tax shelter annuities by the tens of thousands because the they don’t know of the high costs, that annuities are inappropriate retirement plans and that lower cost mutual funds might be available through their employer or district. The agent and the company make much of the money and give the annuitant a small credit. Don’t take my word. Take a look at what Financial Industry Regulatory Agency (FINRA) says: click here.
Dan and I have talked endlessly that annuities are not investments, it is a complicated contract with an insurance company.
If your employer doesn’t offer low cost index or mutual funds, look to your state pension plan for a lower cost 403b that uses genuine investments with mutual or index funds.
If you are a LAUSD employee, take a look at the award winning 457b plan: click here.