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A Texas couple built up $1.8 million across two 401(k)s, a joint brokerage account and a small pension, and they're just two years from their planned retirement date. For the past several months, their longtime financial advisor has been recommending they move a significant portion of their nest egg into a fixed indexed annuity that could pay him an upfront commission of roughly 7%.
Neither of them had thought to ask how their advisor was compensated until a friend mentioned it in passing. That simple question could help them better understand whether their advisor's incentives align with their own. The issue is not necessarily the annuity itself. It's understanding how the recommendation fits their financial goals and whether the advisor has a financial incentive to recommend one product over another.
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A Texas couple built up $1.8 million across two 401(k)s, a joint brokerage account and a small pension, and they're just two years from their planned retirement date. For the past several months, their longtime financial advisor has been recommending they move a significant portion of their nest egg into a fixed indexed annuity that could pay him an upfront commission of roughly 7%.
Neither of them had thought to ask how their advisor was compensated until a friend mentioned it in passing. That simple question could help them better understand whether their advisor's incentives align with their own. The issue is not necessarily the annuity itself. It's understanding how the recommendation fits their financial goals and whether the advisor has a financial incentive to recommend one product over another.
Don't Miss:
AI Robots Have Already Fried More Than 5 Million Baskets Of Food. Everyday Investors Can Still Buy Into The Company Behind Them.
#whether #finance #neither
3 months ago
