What in the clickbait is this?

January 7, 2025 by Sheryl J. Moore

Why is it that the clickbait “What are annuities and how do they work?” nearly always gets it wrong, when it comes to annuities?

I hate it when articles talk about the “types” of annuities, and mention immediate annuities and deferred annuities, but don’t specify that fixed, indexed, structured and variable annuities are all types of deferred annuities. It makes it even more confusing for the reader to determine how these products work.

Interesting description of indexed annuities…doesn’t even explain that the growth potential is limited. (Thanks for misleading tons of readers, Yahoo!)

The “reliable stream of income” is actually something that ALL annuities offer.

And in regards to the “no contribution or other limits,” their advice seems to ignore that annuities can be a vehicle for IRAs, and then there ARE limits.

The “fees and commissions” section would lead you to believe that all annuities have “mortality and expense risk fees” and “administrative fees,” when these are actually features of variable annuities.

Lastly, I always want to yell at the “lack of liquidity” mention, given that nearly all annuities allow the purchaser to withdraw up to [10%] of their annuity’s value annually. Never mind that these products also allow for annuitization and most offer the full account value upon death. I mean, there are surrender charges that apply if you withdraw more than your penalty-free amount each year, but I wouldn’t say that there is a LACK of liquidity in deferred annuities.

And the “possible caps on returns?” That is a feature of indexed and structured annuities. It wouldn’t apply to other types of annuities.

Please do better, Becca Stanek. -sjm