How To Pay Handsomely To Get Your Own Money Back

[...] he spends his best hours where the rubber meets the road, in the analysis of the actual financial products most of us encounter in real life. Suppose you are one of the millions of people who took advantage of an offer for a free dinner - and ended up buying "Living Benefits." [...] he writes on his blog, most retirees with a Guaranteed Lifetime Withdrawal Benefit rider "will do little more than pay a lot in annuity costs to receive a guarantee to just spend their own original contributions and nothing more. Suppose you are a 55-year-old single woman who wants to secure an income at age 65. [...] you get no money for 10 years. In a more likely case, one where your money earns an after-fees net of 4 percent a year, you'll be drawing that $10,000 a year against an actual cash value of $148,000 - so it will take you nearly 15 years, a total of 25 years, before you are getting anything back beyond your original investment and early account earnings. Kitces uses Social Security life expectancy figures, which make the odds worse. While you're getting nothing, the insurance company is collecting about 3 percent for its living benefit guarantee and other insurance contract fees.