Fisher Investments Can Help You Determine if Your Annuity Makes Sense as a Long-term Investment

Listen to our founder Ken Fisher discuss the dangers of annuities with renowned investor Jim Cramer

If you’re in or near retirement, it’s likely you’ve been approached about purchasing an annuity as an investment vehicle. They’re often discussed as a way to enjoy market-like returns without the same risk or to ensure a guaranteed income stream for life. But in the end, annuities are still insurance products, so the companies providing annuities only win when they make more off your money than they pay back to you.

Fisher Investments doesn’t sell annuities, but we do commonly see clients who come to us with annuities whose characteristics don’t match their greater financial goals. We understand that, when used as retirement insurance, annuities can fill a role of transferring longevity risk from the investor to an insurance company. But we also believe your money is best utilized when it helps you reach your goals, which is why we created the Fisher Investments Annuity Evaluation Program. This service is specifically designed to help educate investors about the annuities they own or are considering.

Our guided exploration of an annuity contract, covering both its advantages and disadvantages, can range from simple analysis through Morningstar® summaries to detailed, contract-specific investigations that include calls to the annuity company with you. We firmly believe our fact-finding and analysis can offer you insights into annuity features that many investors overlook or misunderstand, including income, fees, penalties, death benefits, riders and much more. Ultimately, you may find peace of mind in your annuity, or decide to explore investment strategies that better align with your goals.

Here’s how our innovative program works:

Step 1: Gathering Information Specific to Your Annuity

Before we provide any information on whether a particular annuity makes sense as an investment for you, we start by analyzing the specifics of your annuity. What information is important? With annuity contracts often containing hundreds of pages, this question can be difficult for investors to answer. Without understanding what the contract offers and limits, it’s impossible to judge whether the annuity is actually the most appropriate vehicle for the retirement portfolio. We can make it easier for you to answer important questions about whether your annuity is suitable for your goals, regardless of where it was purchased, or from whom. Our Annuity Counselors utilize fund prospectuses, Morningstar® reports, their knowledge of the industry and—with your permission and presence on the line—calls to the insurance company to gather important details and nuances specific to your annuity.

Step 2: Evaluating the Suitability of Your Annuity as an Investment

Our comprehensive annuity analysis will review your contract and personal situation at an exceptional level of detail. Our Annuity Counselors have gained a great deal of experience in both deciphering the confusing language used in annuities and explaining it in clear terms. Below are just some of the common issues we look for in annuity contracts:

  • Is the guaranteed-benefit rider as guaranteed as you think it is?
  • Are variable-annuity fees higher than you realize?
  • What are the indexed-annuity returns?
  • Do surrender fees lock you into annuity investment even if it stops fitting your needs?
  • What are the inflation and tax impacts that may limit the annuity’s ability to generate sufficient income for retirement?

Based on our knowledge of your situation and analysis of your annuity, we will provide you with the information you need to determine whether your annuity has the features that make it appropriate for your investment strategy.

Fisher Investments' Annuity Evaluation Program

Step 3: Explaining the Results of Your Annuity Evaluation

Once our team has the opportunity to thoroughly review the details of your annuity, we will walk you through the various features identified, explain what specifically they provide, and let you know how they either do, or don’t, support your larger financial goals. Annuity contracts are complicated, so we’ll always send you a summary of our findings in writing. These summaries can help explain whether your annuity really is appropriate for your situation. Our Annuity Counselors will provide you with detailed explanations of their findings and fully explain the costs associated with your annuity contract. 

Step 4: Determining if Your Annuity Is the Right Investment for You

If you are comfortable with your annuity strategy, you are free to carry on without any obligation to Fisher Investments. However, if you think converting your annuity may let you explore other investment strategies more appropriate to achieving your long-term goals, we have a program to help you transition your investing strategy. At your instruction, we can help you navigate the surrender process and potentially help with any surrender penalties.*

*Please see important Terms and Conditions below.

Step 5: Fisher Investments’ Annuity Conversion Option

If you determine, after this thorough review, that your annuity isn’t the best option for your financial goals, our team may be able to provide assistance. For those with more than $500,000 in investable assets, we can help plan a more appropriate strategy tailored to your needs. We are dedicated to making sure Fisher Investments clients are on the right financial path for their goals, which is why we may reimburse you for some or all of your surrender fees.* Our knowledgeable team can even help manage the complex liquidation process through your insurance company.

So when considering the advantages and disadvantages of an annuity, you can trust Fisher Investments to provide you with thorough information to help you make a clear, educated decision. You can learn more about annuities by downloading our free guide, Annuity Insights. Or, contact us to find out how we can help you.

*Annuity evaluation terms and conditions

  • Limited offer: Fisher Investments reserves the right to cancel, suspend or modify the offer at any time and for any reason without notice.
  • Eligibility: The offer is available only to qualified investors who become clients of Fisher Investments and who surrender an annuity, CD, REIT, or mutual fund and transfer the proceeds to be managed by Fisher Investments. Nothing in the offer infers any right on any person to become a client of Fisher Investments. Fisher Investments reserves the right to refuse or terminate any person as a client for any reason. Any request to participate in the offer is subject to acceptance by Fisher Investments.
  • Conditions:
    1. The maximum surrender cost that Fisher Investments may agree to pay will depend on the actual surrender cost or exit/liquidation charge of the product (excluding capital gains and other taxes) and the value of the total portfolio transferred for management by Fisher Investments. Any portfolio already managed by Fisher Investments will be excluded for the purpose of determining the maximum surrender cost to be paid.
    2. Any surrender cost that Fisher Investments may agree to pay will generally be reimbursed in the form of a credit to the Fisher Investments quarterly investment advisory fee. Installments for ERISA plan assets will only be credited to the Fisher Investments’ managed account that contains the ERISA plan assets. Installments are subject to adjustment based on withdrawals of assets from Fisher Investments’ management. All payment obligations will immediately cease if the client relationship with Fisher Investments or the account receiving payment is terminated for any reason before the end of the payment period and no further installments will be paid. Payment periods can last over ten calendar quarters or longer.
  • Risks: there is no guarantee any proceeds from any product mentioned above managed by Fisher Investments will achieve any specified level of performance, or that performance will be any higher than what could be achieved within the product. Investing in securities involves the risk of loss. Past performance is no guarantee of future returns.

The contents of this site should not be construed as tax advice. Please contact your tax professional.