Even So-Called Simple Annuities May Be More Complex Than You Think

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The more complex the annuity, the worse it typically is for the consumer. But even so-called simple annuities have important distinctions. Here, I examine two kinds of simple annuities: single premium immediate annuities (SPIAs) and multiyear guaranteed annuities (MYGAs). I just bought the latter for myself but read on before you do the same for a client.

SPIAs. Think of a SPIA as buying a pension. Your client turns over some of their money to an insurance company which promises to pay a defined sum of money every year for...

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