Phil Cannella – Phillip Cannella News: Phil Cannella is strongly opposed to variable annuities and is very vocal about it. Rightly so quite frankly as these financial products are not always well explained to the consumer who then gets locked into one and ends up paying the price. Phil Cannella explains some of the fees associated with these products and it is quite appalling really.
When you lock yourself into a variable annuity, you’ll also have the insurance company to contend with and its own set of fees, called Mortality and Expense or M&E fees, which can run anywhere from 1¼% annually to as high as 5% or higher in many cases. You see, most variable annuities promise that if you die while you own the annuity, your heirs will receive the larger of the account balance or the premium you paid. So, your heirs won’t receive any less than you put into the annuity. That’s what the Mortality fee is for. The Expense fee is simply the insurance company’s profit. And these fees will automatically come out of your account no matter if your variable annuity increases or decreases in value in any given year.
Phil Cannella asks why on earth someone should be put into a product with all these fees when there are other products out there that can do much better with less fees. This is a core principle behind Phil Cannella’s crash proof retirement system that delivers real results without having to be tied to the stock market in any way.
Phil Cannella urges consumers to get educated and informed so that they can make wise decisions for themselves with regard to their finances.