Re: Annuities...are they a crap shoot?

On Fri, 28 Mar 2008 14:13:26 -0500, V <vfr44@[EMAIL PROTECTED]
> wrote:

>My wife has a broker acquaintance that wants her to invest her
>retirement fund (all of it) in a Pacific Life annuity. The annuity is
>supposed to double your money in 10 years or sooner. 

To start with, I would approach this annuity contract with suspicion.  I
know there are good and appropriate annuities out there, and I don't know
enough about you or this contract to tell if there is a "good fit", but
many can do better on their own.

To double your money in ten years, requires a theoretical annual
appreciation rate of about 7.2%.  Compare their **guaranteed** rate with
this rate as well as with what you might be able to earn on another
investment.

Also, you may have to pay penalties for withdrawing before some minimum
time period, so you may not have free use of your money, but rather have
to
pay a charge, which may decrease the appreciation.

It is **very** im****tant that your wife (and you) gain a comprehensive
understanding of the contract, and make sure that you know what you are
getting into.

The "safety" of the contract depends on the reliability of the insurance
company.  Look at www.weissratings.com  for an evaluation.  (It is a pay
site, but if you are investing a significant amount of money, and don't
have another independent rating source, it may be worth it).

At http://www.weissratings.com/HL_annuity.asp
"Pacific Life Ins Co" of
NEbraska is given an "A" rating as an annuity insurer, which is their
highest.  You'll have to research to see if your Pacific Life is the same
as this one.

**BUT** the safety of your investment also depends on the contractual
terms.
--ron

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