 TITLE: Are Annuities a Good Investment? CONTENT: Pros and Cons of Annuities\n--------------------------\nPros and cons accompany any investment product for retirement, and annuities are no exception.\nHere are five of the pros of annuities.\n1.  An annuity may lend a sense of financial security, particularly for those who are near retirement and are nervous about volatility in the stock market.\n2.  Interest earned on an annuity can grow on a tax-deferred basis.\n3.  As opposed to a 401(k) or an IRA, an annuity usually comes with no annual contribution limits.\n4.  Unlike traditional retirement accounts, you're not required to start withdrawing money from an annuity at age 70½.\n5.  Generally, your designated beneficiaries can get payouts from your annuity after you die even if you haven't withdrawn any money.\nHere are five of the cons of annuities.\n1.  The issuer of an annuity may charge various fees, such as a flat annual fee or a percentage fee to cover administrative expenses.\n2.  Some annuity fees are higher than fees for other retirement options.\n3.  If you withdraw money from an annuity before age 59½, the IRS may impose a 10% penalty. That would come on top of any federal taxes you might owe on the money that's withdrawn.\n4.  Unlike money in savings accounts, annuities are not federally insured. Therefore, if the insurer that issued your annuity goes out of business, neither the Federal Deposit Insurance Corp. (FDIC) nor the National Credit Union Administration (NCUA) can come to your rescue. Also, annuities also often lack the consumer protections provided by the Securities Investor Protection Corp. (SIPC). SIPC helps protect investors' assets when a brokerage firm fails.\n5.  If you need to tap into an annuity to cover big expenses, such as an unexpected hospital bill, you may not be able to withdraw the money as quickly as you'd like. Plus, you may face penalties for early cash withdrawal. END