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Firm Updates & Advisor Advice
April 26, 2021

Annuities: Friend or Foe?

Aaron Evans, CFA
With pensions slowly dying, many consumers and investors have started looking for other options. Annuities are poised to be a viable solution, but a shroud of confusion around them has others second-guessing their benefits.

Annuities are a heavily debated topic in the wealth management industry. While some argue that investors should avoid annuity products at all costs, others see them as a viable solution for almost any circumstance. Many annuity products include sales commissions which can inherently create a conflict of interest. Simultaneously, corporate pensions are disappearing, making the concept of guaranteed income streams more appealing to a broader group of investors.

In addition to the controversy, there is also confusion. Annuities have various titles, features, payouts, tax implications, etc. Purchasers receive multi-page contracts with digestibility reminiscent of an old chemistry textbook. Subsequent statements often contain an assortment of numbers to decipher.

At Strategic, we believe that every client situation is unique and must be evaluated as such. No blanket statements. We look at our clients’ goals, positioning, analyze scenarios and seek optimal solutions. We will tell you when an annuity does not make sense for your plan and recommend one if it fits a specific situation.

To continue to bring the best expertise to our clients, Strategic has gone a step further and engaged DPL Financial Partners for annuity analysis and solutions. Through our partnership with DPL, Strategic supports our clients with:

  • Trusted independent analysis
  • Transparency and clarity
  • Value through low cost, no commission solutions

If you have an annuity contract and do not know exactly what it is or why you own it, you are not alone.  Strategic can provide a review of your annuity within the context of your overall plan and help turn any confusion into clarity and confidence.

Original content provided by Aaron R. Evans, CFA, CFP®, a Senior Advisor at Strategic Financial Services.

About Strategic

Founded in 1979, Strategic is a leading investment and wealth management firm managing and advising on client assets of over $2 billion.



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