March 21

Took Dory to the boat in Boonville to feed her a huge buffet meal in honor of her birthday today. The boat was very honored to have us too or at least I calculate it that way. The fickle finger of fate or whatever stepped in and surprised us with a royal flush for $1,000 as we were preparing to leave. Had some leftover after filling the car up too.

Everybody wants to sell you an annuity and like the guy said the other night, as we sat waiting for the free meal that cost him over $500 to fund, "we don't charge you a thing when we sell you an annuity, the insurance company pays us." I looked around, didn't find out how much they are paid but ran across these things.

How One Agent Skyrocketed His Commissions to $354,697 in 7 Months by Selling Annuities. These investment contracts often carry high commissions, onerous fees and surrender charges—the hefty charges that must be paid if an investor pulls money out of an annuity early. In some cases, annuities can increase the investor’s tax burden and can stick heirs with large tax bills. Once the investor starts withdrawing money from an annuity, the capital gains are taxed as ordinary income rather than at the lower capital-gains rates.

http://www.aarp.org/money/wise_consumer/investment_fraud/risky_recipe_variable_annuities_and_a_free_meal.html

On July 2, 2002, page CO-1 of the Wall Street Journal contained a report by Ellen E. Schultz and Jeff D. Opdyke titled "Annuities 101: How to Sell to Senior Citizens."

The report described a training session of "Annuity University," self-proclaimed as the "Nation's first and foremost Annuity Sales Training School." The Annuity University instructor educated the attendees about seniors and selling annuities to them. The WSJ report provided quotes from the training session, including these:

"Treat them like they're blind 12-year-olds . . . ."
"There's the technical answer," . . . and "there's the senior answer. Tell them it's like a CD -- it's safe, it's guaranteed."
"You're there to solve their problems, but you have to create those problems first. No problem, no sale."
"Tell them you can protect their life savings from nursing-home and Medicaid seizure of assets. They don't know what that is, but it sounds scary."
"It's about putting a pitchfork in their chest." (emphasis added)



"Gambling promises the poor what property performs for the rich, something for nothing." - George Bernard Shaw