Free Retirement Classes. What You Need To Know To Retire Successfully

What are annuities?

Types of Annuities

Annuity Terms Glossary

Taxation Of Annuities

Objections to Annuities

State Annuity Guaranty

Pros & Cons of Annuities

Questions about long-term care?

When most people think of longterm care for the elderly, they think of nursing homes. But it can involve much more than that.

Annuity Fees & Expenses

Single Premium Immediate Annuities (SPIAs) and Deferred Income Annuities (DIAs) – No fees or expenses

Fixed Annuities – No fees or expenses

Fixed Index Annuities (FIA) – No fees or expenses, however, FIAs typically offer income riders that may be added at an additional cost.

Variable Annuities (VA) have two expenses:

  • Mortality and Expense (M&E) – This charge equals a , typically about 1.25% annually.
  • Expense ratio of sub-accounts – Purchasers designate the sub-accounts into which money will be invested, and there are investment fees associated with these sub-accounts.

The typical variable annuity pays commission to the advisor out of the M&E charge. However, there are advisory variable annuities that have relatively low internal charges and expense ratios. Financial advisories add their advisory fee to advisory variable annuities.

For more detailed information on variable annuities, read the Variable Annuity consumer brochure by the SEC (Security Exchange Commission).


A common misconception is that annuities are expensive. If you read or hear this, most likely they are referring to variable annuities. SPIAs, DIAs, Qualified Longevity Annuity Contracts (QLACs), Fixed and Fixed Index Annuities do not have fees or expenses unless the annuity owner adds a rider.

For over 20 years, Jim Musgrave has been serving families and businesses as their financial advisor.  Let us put our money management expertise to work for you.  Set up a no obligation consultation by either filling out our contact form or by calling us at 301-588-0514.  We are here for you!

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