Hidden annuity fees: Who’s affected?
Did you encounter hidden annuities fees when buying an annuity as part of your retirement package from public schools in Illinois?
Illinois public schoolteachers and staff are learning a hard lesson about their choice of retirement options. According to the Securities and Exchange Commission (SEC) , at least one company, Equitable Financial, may have committed fraud and cheated on fees.
The SEC estimates 1.4 million variable annuity investors received “materially misleading statements and omissions” concerning annuities fees.
“Since at least 2016, Equitable gave investors the false impression that their quarterly account statements listed all fees paid during the period,” the SEC said in a written statement. “The SEC’s investigation found that, in reality, the statements listed only certain types of fees that investors infrequently incurred and that more often than not the statements had $0.00 listed for fees.”
Equitable said all the information was in the prospectus, but agreed to a $50 million settlement and, if not to change the fees, to at least to make them clear.
While that settlement has already been paid out, customers are continuing to complain about the Equitable EQUI-VEST variable annuity and are asking lawyers to look into Security Benefit NEA Value builder, Pacific Life’s Pacific Choice 2 variable annuities and other funds held inside supplemental retirement savings 403(b) or 457(b) plans.
Do you qualify?
If you are a current or former Illinois public school teacher or staff member who within the last five years owned one or more Equitable Financial EQUI-VEST, Security Benefit NEA Valuebuilders or Pacific Choice 2 variable annutities, you may be eligible to join a lawsuit investigation into whether these companies misled investors about fees.
Please fill out the form on this page for more information.
What is an annuity?
Annuities “are types of contracts between the investor and the insurance company” Time explains. “You can start an annuity with a lump sum of cash and then add contributions as you like. Depending on the type of annuity you choose, you can expect fixed or variable returns on your investment.”
Annuities may be the least understood and least recommended retirement investment. Yet they are among the most popular. In 2023, customers spent a record high $385.4 billion on annuities, a 23% year-over-year jump.
They are advertised with words like “safe” and “maximum benefit,” perhaps with photos of healthy, strong and smiling seniors.
The marketing to schools and unions is heavy. Salespeople who pitch the plans glean high commissions based on the size and complexity of the annuity they sell. These commissions can go as high as 10%.
Yet financial advisors have written reams telling people they probably don’t need annuities and probably shouldn’t buy them unless they are part of an overall tax and retirement strategy, they have made maximum payments into 401Ks or other plans or they want to be assured of some income if they outlive their savings.
But the disadvantages are many. Unlike 401(k) plans in which gains and losses are uncapped, many annuities have limits. Investors will be heavily penalized if they need to liquidate an annuity, perhaps losing some of their initial investment.
Hidden annuities fees may be most damaging. They can appear tiny but over time can take a huge chunk out of a person’s expected retirement income.
Is it happening to you? Let experienced lawyers help you find out.
Join a hidden annuities fees investigation
If you are a public schoolteacher or staff member in Illinois, you may qualify to participate in a lawsuit investigation into hidden annuities fees in retirement annuities.
Please fill out the form on this page to see if you qualify for a FREE case evaluation.
GET HELP – IT’S FREE
Join a hidden annuities fees lawsuit investigation
If you qualify, an attorney will contact you to discuss the details of your potential case at no charge to you.
After you fill out the form, an attorney(s) or their agent(s) may contact you to discuss your legal rights.
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