Some are. Some aren't. The category is too broad to label all of it good or bad, and the women who tell me "I heard annuities are bad" usually heard it about a specific kind of annuity that I don't sell.

The criticism is often aimed at variable annuities, which are a different product class entirely. Variable annuities put your money in subaccounts that rise and fall with the market, often come with high internal fees, and have a long history of being oversold to people who didn't understand what they were buying. The criticism of variable annuities is largely deserved. I don't sell them.

There has also been legitimate criticism of certain indexed annuity products that were sold with overly complicated structures, hidden fees, or unrealistic illustrations. That criticism is fair too. The fixed and fixed indexed annuities I work with are simpler products with transparent structures, principal protection, and clear lifetime income mechanics. They're not the right fit for everyone, and I'll tell you when they're not. But they're not the products the headlines were written about.

The real question isn't "are annuities good or bad." It's "is this specific annuity, with this specific carrier, the right tool for this specific part of my retirement plan." That's the conversation we have together.

These three products share a name and almost nothing else. Here is the simple version:

A fixed annuity is designed to provide safety and predictability. You place money with an insurance company, and the company credits a stated interest rate for a set period of time. Your principal is protected from market losses, and the growth is generally modest and predictable.

Some people compare this to a CD because of the fixed interest concept, but there is an important difference: annuities are not FDIC insured. They are backed by the claims-paying ability of the issuing insurance company.

A fixed indexed annuity also protects your principal from market losses, but the interest you may earn is linked to the performance of an index, such as the S&P 500. You are not directly invested in the market. Instead, the insurance company uses a formula to determine how much interest is credited.

That formula may include things like caps, participation rates, or spreads. In a strong market year, you may receive some of the upside. In a down market year, your principal is not reduced by market losses, although surrender charges may apply if you take out more than allowed during the surrender period.

Fixed indexed annuities are often used by people who want some growth potential, but do not want their retirement income foundation exposed directly to market losses.

A variable annuity is different. With a variable annuity, your money is typically invested in subaccounts that can rise and fall with the market. These products can involve market risk, internal fees, and more complexity. They also require a securities license to sell.

I do not sell variable annuities, so they are not part of the protected income planning work we would do together.

The most important thing to understand is that not all annuities are the same.

A fixed annuity, a fixed indexed annuity, and a variable annuity may share a name, but they behave very differently.

So the real question is not, “Are annuities good or bad?”

The better question is:

“What kind of annuity is this, how does it work, what are the tradeoffs, and does it fit the job we need it to do in your retirement plan?”

If a fixed annuity or fixed indexed annuity is placed, I am paid a commission by the insurance company that issues the annuity.

You do not write me a check for that commission, and I do not charge ongoing management fees on money held inside the annuity.

That is how these types of insurance products are commonly structured, and I believe it should be discussed clearly and up front. You deserve to understand how I am compensated, what the product does, what it does not do, and what costs or limitations may exist before you make any decision.

When we look at a specific annuity together, I will walk you through the details in plain English, including why I believe it may fit your situation, how it compares with other options, what problem it is designed to solve, and what tradeoffs come with it.

We may also look at more than one option side by side, so you can see the differences for yourself.

If you are wondering whether compensation creates a conflict of interest, that is a fair question — and I respect you for asking it.

The honest answer is that I am paid when business is placed. That is true for many professionals who work with insurance products. But my responsibility is to help you understand whether a specific annuity is appropriate for your needs, your income goals, your comfort level, and your overall retirement picture.

I will not recommend an annuity simply because compensation is available.

If an annuity is not the right fit, I will tell you. If another option appears to serve you better, I will tell you that too.

My goal is for you to make an informed decision with clarity, confidence, and no surprises.

Not from market losses.

With a fixed annuity or fixed indexed annuity, your principal value is not reduced because the stock market has a bad year. If the market drops, your annuity value does not drop with it due to market performance.

That is one of the main reasons these products are used in protected income planning.

However, that does not mean there are no rules, limits, or tradeoffs.

There are situations where the amount you walk away with could be less than expected.

The first is if you take out more than the contract allows during the surrender charge period. Most annuities have a surrender period during the first several years of the contract. During that time, the insurance company may charge a fee if you withdraw more than the free withdrawal amount allowed each year.

The second is if withdrawals are taken in a way that affects the remaining account value or any income benefits attached to the contract. Taking too much, too soon, can reduce what is available later.

That is why we look closely at the details before you ever make a decision.

We will walk through the surrender schedule, the free withdrawal rules, any income rider provisions, and what happens if you need access to more than the contract allows.

The goal is for you to understand exactly how the annuity works — not just the benefits, but also the limits — so you can decide whether it truly fits your retirement income plan.

In most fixed and fixed indexed annuities, any remaining account value typically passes to the beneficiaries you have named on the contract.

That is one of the features that often surprises people. An annuity is not simply “gone” when you pass away. The details depend on the specific contract, but your beneficiaries may have options for how they receive the remaining value, such as a lump sum or payments over time.

Naming beneficiaries directly on the annuity contract can also help make the transfer more direct for your family, often without going through probate. Of course, estate and tax rules can vary, so it is always wise to coordinate beneficiary decisions with your legal or tax professional.

If you have selected a lifetime income option, the rules can vary depending on how the contract is structured. For example, it may depend on whether the income is based on one life or two, whether income has already started, and what riders or features are attached to the contract.

That is why we do not guess.

We walk through your specific contract together so you understand what happens in different scenarios — while you are living, if income has started, if income has not started, and what your beneficiaries may receive when you pass away.

This is also why we carefully review beneficiary designations during the process. It is one of the most important parts of the contract, and one of the easiest details to overlook.

The goal is simple: you should understand how the annuity supports your income while you are here, and how any remaining value may pass to the people you care about when you are gone.

Yes — but there is structure around how access works.

Most fixed annuities and fixed indexed annuities include a free withdrawal provision, which allows you to take out a certain percentage of your account value each year without a surrender charge. A 10% annual free withdrawal is common, but the exact amount depends on the contract.

That means some money is available to you each year, for any reason, without a surrender charge from the insurance company.

If you withdraw more than the free withdrawal amount during the early years of the contract, surrender charges may apply. These charges typically decline over time and eventually go away, often after 5 to 10 years, depending on the product.

After the surrender period ends, you typically have access to your money without surrender charges.

Some contracts also include provisions that may waive surrender charges in specific situations, such as a terminal illness diagnosis or certain long-term care needs. These provisions vary by insurance company and product, so we would review the exact details together before you make any decision.

The honest reality is this:

An annuity is designed for income and protection. It is not meant to be your emergency fund.

That is why we never put money into an annuity that you might need access to in the next few years. Your liquid savings should stay liquid. Your annuity money should be the part of your savings you have already decided is for the long haul.

The goal is to create protected income without sacrificing the flexibility you still need in the rest of your retirement plan.