Just a few years ago, variable annuities were shunned by financial advisers, criticized as expensive at best and scams at worst. But today anxious baby boomers are embracing a newer version that makes some impressive promises.

The new pitch: The payments keep coming no matter what happens to the market, and investors can get their savings back.

Several experts interviewed in the article warn that the insurance companies haven't done their homework in assessing the market risk.

The following excerpt sums up the issue nicely:

In an age of figure-it-out-later financing that helped contribute to the subprime debacle, many annuities rest on a foundation of untested assumptions.

 

Submitted: Jun 30, 2008    Views: 144    Comments: 0    Likes: 1   


View Article: http://www.smartmoney.com/smartmoney-magazine/index.cfm?story=july2...


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