Personal Investments • Talk me out of these USAA annuities

Every single experience I have had to date tells me that what you see with annuities, of any flavor, is NOT what you get. If you have an example of an actual MYGA, ideally one that is close to its maturity/expiration, that demonstrates on NET--after all fees, commissions, surcharges, costs, and any other synonym for fee they can come up with--the actual return stated is in fact the return earned, I'd really like to see it.

Thanks for your defense, Stinky. Last Friday I filled out an application for a 6.35% 5 year MYGA that did indeed actually include a request for transfer of funds from my 401k, and I was beginning to worry and second-guess until I read this.

Let's look at the Reliance Standard MYGA you linked above. Here's a copy of your link: https://www.blueprintincome.com/fixed-a ... A&id=44065

Note that the $500,000 initial premium you input to the website will grow to $802,887 over the next 10 years. Doing a calculation to check out the rate of growth, [($802,887 / $500,000) ^ (1/10)] - 1 = .0485, or 4.85%. So that checks out, as the Blueprint website quotes 4.85% as the interest rate for the annuity.

Next, here's some text from the Blueprint website for this annuity:

The following is your guaranteed annual account balance....

Here's some more text from the website:

At the end of the contract term, you can withdraw the money invested....

Finally, here's a brochure for the Reliance Standard product, linked from the Blueprint Income website. The 10 year product is on pages 5-6 of the pdf. To my reading there is nothing in the brochure inconsistent with my belief that the premium will grow at a guaranteed rate for 10 years, and be fully available without other fees, surrender charges, or market value adjustments at the end of 10 years. (Please note that the brochure is slightly out of date as to the interest rate quoted, since the brochure shows the interest rate as of 10/1/23, when Reliance Standard’s interest rates for new business were higher).
https://public-static-content.blueprint ... ochure.pdf

If you want any additional confirmation that MYGA products provide a fixed and guaranteed return for a fixed period of time, I suggest that you talk to the good folks at any of the agencies mentioned frequently on this Forum - Blueprint Income, Annuity Advantage, or Stan the Annuity Man. Each of those agencies sells MYGAs from multiple companies on a nationwide basis, and they'll be more than happy to talk with you.

I hope these comments are sufficient to allay your concerns that MYGAs aren’t what they are cracked up to be, and aren’t laden with additional fees or "gotcha's"

If 99% of annuities sold are predatory, I find it foolish to insist that "not all annuities are bad".

Recent annuity sales are in the area of one-half MYGAs, and the remainder of other types of annuities (variable, indexed, buffered, etc.). So I believe that your assertion that “99% of annuities sold are predatory” is flatly incorrect.

It may be true that 99% of the sales that YOU'VE seen were predatory, but that is not true for the population as a whole.

Statistics: Posted by bellomom — Mon Jul 15, 2024 11:31 am — Replies 57 — Views 5604