Annuity lawsuits by the thousands have come to light from massive annuity losses generated by unethical annuity brokers and sales people who received hefty commissions to sell annuities whether or not they were suitable investment choices.  Did your annuity investment lose money?

It’s sad but true and so prevalent that both NASD and SEC have given severe warnings and fines to brokers and insurance companies for selling variable annuities to clients who cannot benefit by, and more often than not, are penalized from annuity losses.

Variable annuities are sold to investors with promises of tax deferral until withdrawal and “guarantees" of principal. Variable annuities are normally purchased with a large lump-sum payment and are combinations of an insurance policy and mutual funds. As opposed to being a fixed or constant rate of return, there are options for several variables which are similar to mutual funds. The sale of variable annuities usually yields one of the highest commissions a broker or insurance salesperson can earn. Nevertheless, unscrupulous salespeople misrepresent the facts or will say anything just to make the sale and keep making a commission that doesn’t stop with the sale.

To make matters worse – variable annuities are often sold to unsuspecting investors, frequently to people approaching retirement or already in retirement. Variable annuities are not a suitable investment tool for people in this age bracket because there are steep penalties for early withdrawal and variable annuities lack liquidity. Investors may also be told that the principal is guaranteed but that only occurs in the event of death; no advantage there. Sales techniques may include making you feel confused and frightened by scare tactics or creditors and legal mumble-jumble. Brokers may also advise you to switch annuities. Beware as this is a bad idea for you but a big commission lies ahead for the seller.

Were you invited to a seminar, fed a free lunch, schmoozed and flattered or frightened, then hoodwinked into buying annuities?  You are not alone. Do you need an annuity lawyer?

Were you informed about the downside of variable annuities and the possibility of annuity losses? Your gains aren't taxed until you withdraw the money, but then you pay at regular income tax rates, which currently range up to 35 percent. For comparable investments in mutual funds or stocks for at least a year, you would pay capital gains tax rates of 5 to 15 percent. With all the fees and costs, it takes 10 years or longer for tax deferral fees. Any withdrawal before age 59 ½ is subject to 10 percent federal penalty on top of any income tax you owe.

Variable annuities are bad choices for short-term investors.  You might not know this but the person who sold you the variable annuity sure did.

You are not alone. Legal help is here.