Posts belonging to Category Variable Annuities and Equity-Indexed Annuities

Wall Street Compensation Systems are the Roots of Many Evils


Could Wall Street’s role in creating the recent financial crisis boil down to something as simple as a conditioned reflex? Apparently so, according to William D. Cohan, a former investment banker. Cohen writes: Wall Street “rewards bankers and traders for the revenue they generate by constantly selling whatever comes across their desks, regardless of its […]

Securities Regulator Alerts the Public About Dangerous Investments and Investment Strategies


The Financial Industry Regulatory Authority (FINRA) recently issued a report outlining is its regulatory and examination priorities for 2012. The securities industry regulator is focusing on conduct and products meant to beat the market that are unsuitable investments for many investors.

Most Financial Advisers Don’t Understand Alternative Investments According To John Hancock Survey


Given the array of exotic alternative investments being sold to the public, it’s logical that many investors often don’t understand what they are buying. What is even scarier is that it is likely their professional investment adviser doesn’t understand the alternative investment either. Investment advisers ? 75 percent of them ? admit they do not […]

MONEY Magazine – Variable Annuities Aren’t Worth the Cost


Variable annuities are complex financial products designed to transfer the risk of market loss from the investor to an insurance company. Assuming the investor is risk averse (after 2008, who isn’t?), the question is, is it a good deal? The answer, according to MONEY Magazine and most advisers that do not sell variable annuities for […]

AARP Article Urges Seniors to be Vigilant in Watching Out for Financial Scams


Preparing for retirement should include preparing for the risk of diminished mental capacity, according to noted financial writer Jane Bryant Quinn (“Losing Your Grip?”). It is an unpleasant fact of life that, as we age, we become less competent to make financial decisions. A 2009 study on financial decision-making found that this ability peaks at […]

Wall Street Pays to Play


Financial industry lobbyists know that money is the key that opens doors on Capitol Hill. Trade groups representing the insurance, securities brokerage and financial advisor industries are lobbying and donating huge amounts of money in an effort to buy hearings and sway votes on legislation and rulemaking they deem important to their interests, according to […]

Most Alternative Investments Carry Huge Risks


Investors should use extreme caution before investing in alternative investments. Alternative investments have become the popular “investment du jour” but these investments are fraught with risks. Simply stated, alternative investments are not the panacea that so-called experts represent them to be. For the reasons discussed below, investors need to be very skeptical of any recommendation […]

Seniors Are Increasingly Targeted in Financial Scams


The time is ripe for financial scammers who seek to take advantage of senior investors. Recently a 76-year-old Texas insurance agent was sentenced to up to 15 years for selling fake annuities to other elderly investors. The scammer in this case just happened to be the same age as many of his elderly victims. Mr. […]

Alternative Investments Are Very Complex and Involve Significant Risks


Many registered investment advisors and brokerage firms have increased their use of alternative investments for clients, many of whom are retired and lack the knowledge and sophistication to understand the complex investments, according to Liz Skinner’s InvestmentNews article entitled “Clients clamoring for alternative investments and advisers obliging.” But are alternative investments suitable for most investors? […]

Market Turmoil Expected to Precipitate an Avalanche of Suitability Claims


Just as a low tide near the seashore can reveal shipwrecks, a falling stock market often reveals misconduct by investment advisers. This is particularly true with respect to an investment adviser’s duty to recommend only investments to a customer that are suitable in light of the customer’s investment objectives, status in life and risk tolerance. […]