It’s a funny number – isn’t it? This is the number that was listed as the very small compensation to be paid to an agent proposing an annuity for a client. The actual statement is “will pay financial advisor a commission based fee equivalent to .61795% of the deposit annually over the 10yr. period of the annuity”. This 10 year annuity, that the agent also quotes an average annual return of 3%, was suggested for a client under 24/7 care with annual expenses of $75,000. The actual amount as a suggested deposit was $750,000 with the ability to withdraw 10% annually to meet the care needs without being charged a penalty. What this annuity does not allow for is liquidity of the principal in case there is an emergency beyond the 10% annual withdrawal. While this financial advisor addressed the current cash flow needs, there was, in my opinion, no forward thinking for the unknown.
By the way; the low compensation of .61795% is equal to $96,400 in the first three years – not such a funny number – is it?

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