Purchasing or Exchanging Variable Annuities

What this video covers

• How immediate and deferred variable annuities differ on accumulation phase, payment timing, and typical buyer profile
• What each layer of the variable annuity fee structure covers: mortality and expense (M&E) risk charge, administrative fees, subaccount expenses, rider charges, and 12b-1 fees
• Why the free withdrawal allowance (typically 10% of account value per year) avoids the Contingent Deferred Sales Charge (CDSC) only, not the 10% federal tax penalty before age 59 1/2
• The exceptions to the 10% early withdrawal penalty: death, disability, and Substantially Equal Periodic Payments (SEPP)
• How the right of accumulation (ROA) works as a volume discount for breakpoint pricing across multiple purchases
• Why the waiver of premium rider belongs to variable life insurance, not variable annuities
• The strict one-way direction of tax-free exchanges under the Internal Revenue Code (IRC): life insurance to endowment to annuity, never backward, and the 36-month look-back rule that flags churning