Equity Indexed Annuities: Lining The Advisor's Pockets

Q. Sir, a local Certified Senior Advisor has advised me to move the CREF portion of my University TIAA/CREF account (about $250,000) into an #### 14 year Equity Indexed Annuity. I am 68 years old and do not need the income now since I have a military pension, social security and a working wife who is an accountant. Have I missed something here, since I am having difficulty trying to see how this is in my best interest? My plan had been to simply take the required IRS Minumum Distribution at the required age.

Is the advisors plan better than mine?



A. Absolutely not!

Trust your instincts--the advisor was out to line his/her pockets.

#### is one of the highest paying EIAs on the market. Your CREF annuity is fine. By the way, I'm a Certified Senior Advisor too. Frankly, it doesn't mean anything. It is a designation designed to give investors the belief that the advisor is specially equipped to serve the Senior market. It took me a couple of days to get this 'advanced designation'.

On the other hand, it takes most people two years to get the Certified Financial Planner designation (CFP)--although I've seen some fellow CFPs recommend people put 100% of their investable assets in EIAs!

You asked if I knew someone you can trust in the MO area. I don't have relationships with other advisors. I do serve a small group of clients who live pretty much all across the nation. Depending on your needs, I will be happy to help you.

If it is answering questions and providing a second opinion, I will be happy to do it for free. The only time there will be a charge is if at some point you need and want my money management services. Regardless of where my money management clients live, I meet with them face-to-face at least once per year--more if necessary.

For instance, I'm flying down to Texas next weekend to meet with a few clients there. Since my overhead is so low, I can charge the same or less than other advisors and still cover all my travel costs.

It sounds to me that you are working with commission-based advisors. They will always have an inherent conflict of interest and it will always be hard for you to know if their recommendation is in their best interest or yours (it's rarely both!). Did the advisor recommending the #### life mention that he/she would probably earn $25,000 if you said yes?

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