Millions of Americans own annuities that were purchased years—or even decades—ago. While these financial products often continue to serve an important purpose, many owners have not reviewed their contracts since the day they were purchased. According to Owen Edwards, Certified Financial Fiduciary®, that can be a costly oversight.
“An annuity shouldn’t be viewed in isolation,” said Edwards. “It should be evaluated as part of your overall financial plan to make sure it’s still accomplishing what you need it to accomplish today—not what it was designed to do 10 or 15 years ago.”
Over time, financial goals evolve, interest rate environments shift, and retirement planning needs change. In addition, newer annuity products may offer features and benefits that were not available when many older contracts were originally purchased. As a result, a comprehensive annuity review can help investors better understand how their existing contract fits into their current financial strategy.
An objective annuity review may help identify:
- Hidden fees and expenses. Some older variable annuities may include mortality and expense charges, administrative fees, investment management fees, or optional rider costs that owners may no longer need or fully understand.
- Unexpected investment risk. Some investors assume their annuity principal is fully protected when portions of the contract may still be subject to market fluctuations. Others may be taking a more conservative approach than necessary, potentially limiting long-term growth opportunities.
- Potential growth opportunities. Depending on an individual’s financial goals, there may be products or investment strategies that better align with today’s market environment while continuing to address objectives such as growth, income, or principal protection.
- Tax and retirement income planning. A review can help determine how an annuity integrates with a broader retirement income strategy and whether it complements other retirement assets in a tax-efficient manner.
- Beneficiary and legacy planning. Beneficiary designations, payout options, and estate planning objectives should be reviewed periodically to ensure they continue to reflect a client’s wishes and overall legacy goals.
Importantly, Edwards emphasizes that reviewing an annuity does not necessarily mean replacing it.
“In many cases, the best recommendation is to keep the contract exactly as it is,” Edwards explained. “The goal isn’t to replace products—it’s to determine whether they’re still serving your best interests and working alongside your other investments.”
Edwards encourages investors to think of an annuity review much like a routine physical checkup.
“An objective analysis can reveal strengths to preserve, weaknesses to address, and opportunities that may otherwise go unnoticed,” he said. “A review can provide peace of mind that every dollar is working together toward your long-term goals.”
As retirement planning becomes increasingly complex, regularly reviewing financial products—including annuities—can help ensure they remain aligned with changing goals, risk tolerance, and income needs.
About Owen Edwards Owen Edwards, Certified Financial Fiduciary® serves individuals, families, and business owners throughout Northeastern Pennsylvania and nationwide.
In his 30th year, Edwards is known for his educational, client-first approach and his dedication to helping clients gain clarity and confidence to make informed financial decisions.
Learn more: MeetOwen.pro
Owen Edwards is an Investment Adviser Representative of and investment services offered through Royal Fund Management, LLC, an SEC Registered Adviser. 401(k) Maneuver is another business name for Royal Fund Management, LLC.
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