Good article on “Do VAs Ever Make Sense?” (The Puzzler, January 2005)
I wish you would look into some popular riders that I find very, very attractive, including guaranteed income and death benefits that compound annually.
I invested a substantial amount of client assets into Scudder Destinations, which the company then cut off. I did another few million with US Allianz Life, which then cut theirs. The list goes on.
If annuities are such a rip-off, how come these insurers have ended these programs?
My prediction is that Equitable and MetLife will end theirs next.
Jack Oujo, CPA/CFP
Wall, New Jersey
The Puzzler (Ben Warwick) responds:
1. The length of “The Puzzler” did not allow me to explore the myriad of guaranteed equity-linked products that are now offered by annuity companies. Perhaps a more in-depth article could be possible in the future.
2. I never said that annuities are a “rip-off.” On the contrary, they may make sense for some investors. In the case of Scudder Destinations, the embedded options may have been unintentionally underpriced, which would cause Scudder to discontinue the products.