The Dreaded Surrender Charge

Surrender charges are a dreaded by most investors. The topic is also dreaded by most advisors! Annuities are such great investments but they come with surrender charges. How do you overcome the high charges to withdraw money?

The answer lies in careful income planning and knowing what you are getting into in the first place. Always carefully examine the annuity documents before investing. It is very tempting just to trust your advisor and not try to understand the contracts. That is as big mistake.

It is not that your advisor is not trustworthy; it is that communication can never be 100% accurate. When people speak we hear what we hear through a biased filter of our own experiences. We also speak through a biased filter of our own experiences. Therefore, communication is then never 100% accurate and the details of the contract should be thoroughly studied.

Now add in that your needs may change over time. How much income you need today may change ten years from now and what about twenty years from now? Your advisor could retire or even be out of the business by then but you will still have your annuity. It is vital that you understand how it works and how the internal components relate to each other.

To overcome the surrender charges you need to understand how they work.

To get a better understanding read - Why Are Surrender Charges So High?

To understand more about surrender charges read - Why Do Annuities Have Such A Bad Reputation?

And to learn how to avoid surrender charges altogether read - Avoiding Surrender Charges Through Careful Income Planning

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