Every Bad Thing You Have Heard About Annuities, Answered Straight

Why does the word annuity make so many smart people tense up before they have heard a single detail? I think it is because they have heard the knocks over and over and never once heard anyone answer them straight.

I say them first

So I say every bad thing you have heard out loud, before you can. They are expensive. They can lose money. They lock up your money. The fees are terrible. Turn on income and die tomorrow and it is all gone. The person selling one is working on commission. And if they were any good, a fee-only advisor would use them.

Then I tell you which of those are fair, which are a smear, and the one that is actually true about me.

Most of the confusion lives in the word

Annuity covers a whole range of completely different products. Some are simple, some are genuinely complicated, some carry high costs and some carry very low ones.

Lumping them together is like saying vehicles are dangerous. A motorcycle and a minivan are both vehicles. That sentence tells you nothing useful about either one, and neither does a blanket verdict on annuities.

Why this matters before anyone signs anything

You cannot make a good decision about something you have only ever heard attacked or only ever heard sold. The point of this video is to give you the objections and the answers together, so the decision is yours and it is informed.

Go deeper

Are annuities ever a fit in a retirement plan?

Are annuities safe? The pros and cons

Everything on this page is illustrative and hypothetical as of August 2026. It is education, not investment, tax, or legal advice. Any people shown are examples, not real clients, and your situation will differ. Withdrawal-rate rules of thumb are general guidance from published research and are not a prediction or a promise of any result. Protected Lifetime Income figures rely on the claims-paying ability of the issuing insurance company. Kurt H. Jackson is Life and Health Insurance Licensed in MO, NE, KS, IA, and FL, and is not a securities broker, registered investment advisor, or CPA.

Browse all of Kurt’s retirement videos on the Retirement Planning Videos page.