Uncovering value in 'vintage' VAs

With variable annuities (VAs) falling out of favor with carriers and consumers alike due to their vulnerability to market volatility and their guaranteed living benefits which cause carriers to come up with ever-more exotic hedging strategies to insulate themselves from market declines, both parties seem to be looking at the once go-to retirement products with distaste.

MACRO Consulting Group, a financial planning firm specializing in retirement planning, has designed an Annuity Review which aims to assist fee-based financial advisors with a dearth of knowledge about insurance products and help individual investors uncover value in the currently out-of-fashion products.

VAs, by their nature, contain standard provisions offered during a past, one-time period that can vary when compared to products issued at a later date. Older, ‘vintage’ VAs have been found to have valuable aspects that can easily be overlooked by the untrained eye at the time of purchase. Some of these provisions include more generous than realized payouts, lower costs, superior fixed options, death benefits and lifetime guarantees that would not be included in new VAs.