Safeguarding Yourself before a Variable Annuity 401k Purchase

If you are getting ready to make a variable annuity 401k purchase, you will want to make sure that you consider all of the factors involved first. Here are a few things to consider about safeguarding yourself before a variable annuity 401k purchase. 

Investments

With a variable annuity, you are going to be in charge of selecting your own investments. Therefore, you want to make sure that the investments are to your liking before getting involved. You will typically be able to select from a group of different mutual funds within your portfolio. You will want to check on the historical performance of these mutual funds to ensure that they perform well enough to meet your goals. 

Fees

There are several different ways that an insurance company can charge you for a variable annuity, and you want to fully understand what the fees are and how they work. For example, they could choose to charge you something on the front end of your transaction when you make your premium payments. They could also choose to take a margin out of the performance of your investments on the back end. Either way, you want to find a fee structure that is fair for you.

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