Does being more conservative inside this variable annuity mean you won’t lose money right before your retirement date?Thanks for reading this review. But how much can you protect?Here’s what you may not realize:Statistically speaking, the chances of meeting with an untimely death when the market is down AND when you’ve lost a portion of your contributions may be relatively low. Get familiar with the various types of fees so that you’ll know exactly what you’ll be charged by the AXA Equi-Vest variable annuity.
But you should consider whether the cost of this feature is worth the potential benefits you could receive.Deferred annuities are long-term contracts and most annuities of this type charge surrender fees during the first 5 to 10 years of the contract. If you’re interested in my thoughts on this product and why I don’t recommend it to any teacher, it’s all about the fees, poor fund choices and lock-in periods. I’ll be going into the details when we get to the benefits and features section.This annuity also gives the agent commissions based on your contributions.Variable annuities invest directly in the market, and as such, they can lose money just like stocks and mutual funds. There is a Custodial Fee of 0.06% applied quarterly, or 0.24% per year. So, then you might select a Target Date Allocation Portfolio. They also typically allow a 10% free withdrawal amount subject to federal income tax withdrawal restrictions.If you’re not familiar with variable annuity products and how they work, fees can be confusing to decipher. Over time, these additional costs can negatively impact your return potential.A variable annuity is a type of deferred annuity, so there are two phases to your contract: the growth phase, and the income phase.How about the Guaranteed Interest Option (GIO)? Furthermore, any investment that you purchase inside your 403(b) account can give you tax-deferred growth.This is something you want to look very closely at if you are still working and making contributions to your retirement plan. Let’s examine each fee and how they stack up against other investment options.If you’re looking for protection from market risk, you may select the Structured Investment Option (SIO) available within certain EQUI-VEST variable annuities. (12b1)EQUI-VEST® is a deferred annuity contract issued by AXA Equitable. That might sound good for someone who is nearing retirement and wanting to protect their nest egg. by Earl, 5/28/2020 Pros: Broker only calls annually when he want you to deposit: more deposits = more commissions for him! Then the market takes a turn for the worse and drops by 30%. This option gives you different investment strategies designed to adjust with you as you move through the phases of your life and become more conservative. The sales agent may also tell you that these investments all benefit from tax-deferred growth.If you’re contributing the maximum 2018 amount of $18,500 to your plan and, if over 50, also taking advantage of $6,000 catch-up contributions, then AXA could be paying as much as $490 a year to your broker.Okay. There is no charge to move among the investment options. For someone trying to save for a retirement, fees are an important consideration. Using the 403bcompare website, the AXA variable annuity has a 1.20% mortality and expense fee.