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Life Health > Annuities

Beware the Pitch for Indexed Annuities (Reuters)

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Indexed annuities serve a valuable investing purpose, bridging the gap between high-risk, potentially high-return market investments and low-yielding certificate of deposits. But despite this upside, the products have plenty of critics, who maintain that any benefits are overshadowed by high costs and complex terms that are difficult for consumers to understand (which has led to lawsuits in the past). For consumers, the important thing is that they understand the possible pros and cons of the purchase and are happy with returns that are not earth-shattering, but are higher than your average bond or fixed annuity.