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Is Allianz Annuity a Scam?

A:

Quick Answer

Allianz Annuity, one of many indexed annuity funds, is a poor investment, according to Forbes, but not a scam. In fact, some investors turn to these insurance products as protection from potential stock market downward adjustments.

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Full Answer

The appeal of these indexed annuities is the promise of tax-free growth and a guaranteed minimum return rate. Should the stock market index decline, investors still receive a minimum. When the agreed upon investment period ends, the fund returns the initial capital, plus earnings. The drawbacks are that investors receive only a small percentage of market gains, and loss protection is minimal, Kiplinger points out. A better choice is a variable annuity guaranteeing benefits.

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