If you’ve ever asked an advisor about annuities, you’ve probably heard one of two extreme reactions:
- “Annuities are terrible. Never buy one.”
- “You definitely need an annuity… and here’s the one I sell.”
So why do financial advisors love (or hate) annuities so much?
Because annuities don’t just affect your retirement plan—they can also affect how an advisor gets paid, what they believe “good investing” looks like, and whether they prioritize guarantees or growth.
I’m John Stevenson, the Guaranteed Retirement Guy, and in this article I’m going to break down the real motivations—good and bad—so you can make a confident decision for yourself.
Need help choosing the best annuity for your unique situation? Have questions about getting an annuity? If so, it’s best to speak with an annuity specialist. Watch this short video to see how I can help you do this (at no cost to you!)
Tip: See how much an annuity could pay you using our annuity calculator
The #1 Reason Some Advisors Hate Annuities: AUM Fees Disappear
Many advisors get paid using an AUM model (assets under management).
That usually means they earn a percentage (often around 1%) each year on the money they manage.
So if you move $1,000,000 into an annuity, that money may no longer be managed in the same way… and the advisor may lose that recurring fee.
Example:
- $1,000,000 under management at 1% = $10,000 per year
- If multiple clients do that, the advisor’s revenue can drop fast
That doesn’t automatically make the advisor “bad.” But it does explain why some advisors fight annuities so hard.
💡 Pro Tip: When an advisor strongly warns you away from annuities, ask:
“Is your compensation impacted if I move this money?”
👉 Want a transparent comparison? Check the calculators and see multiple carriers side-by-side.
A Legit Reason to Avoid Annuities: You Only Want Maximum Growth
Not every “anti-annuity” advisor is wrong.
If your goal is:
- maximum long-term market growth
- and you’re comfortable with market risk
- and you don’t need contractual income guarantees
…then yes, an advisor might reasonably say: “Stay invested. Don’t buy an annuity.”
That can be sound advice—for the right person.
The real issue is when someone says “annuity = always bad” without talking about what you actually need the money to do.
👉 If you’re trying to balance growth and guarantees, I can help you compare strategies.
Why Some Advisors Love Annuities: Commissions, Bonuses, and Incentives
On the other side, some advisors push annuities hard for one big reason:
They get paid a commission to sell them.
And sometimes there are extra incentives:
- higher commission levels for high volume
- overrides from broker-dealers or agencies
- trips, bonuses, and production rewards
This is why you might see an advisor repeatedly recommend:
- the same annuity type
- the same carrier
- the same “one solution for everyone”
Even if it’s a decent product, it may not be the best product for you.
💡 Pro Tip: If your advisor only shows you one company, ask:
“What other carriers did you compare, and why did this one win?”
👉 Want to see a broader market view? Use these annuity calculators.
“Great Company” Doesn’t Automatically Mean “Best Annuity for You”
Here’s the truth most consumers don’t hear:
A carrier can be:
- big
- highly-rated
- well-known
…and still not be the best for your specific goal.
For example, some companies may be strong for:
- increasing income designs
…but not the strongest for: - highest lifetime income payout
- best fixed growth rate (like MYGAs)
- best index-crediting approach for your priorities
Sometimes the annuity being recommended is “good enough”… but another carrier might pay more income or fit your goals better.
👉 If you want the “best for your goal,” you need comparisons—not opinions.
The Consumer Solution: Compare Options Before You Commit
If you’re the one retiring, you deserve transparency.
That’s why I encourage you to:
- Use the calculators to run real comparisons across carriers
- Decide what you actually want the money to do:
- income you can’t outlive?
- growth with protection?
- bridging an early retirement gap?
- leaving a legacy?
- income you can’t outlive?
- Then talk with someone who will show you multiple options, not just one
I work with people who have:
- $100,000
- $200,000–$400,000 (very common)
- $1,000,000+ too
The amount doesn’t matter as much as having the right tool for the right job.
👉 Want help choosing the best annuity for your goal? Schedule a call here.
What “Transparent Annuity Planning” Looks Like (My Approach)
Here’s my philosophy:
- I like annuities and the market
- I use the market for growth (ETFs, stocks, funds)
- I use annuities for contractual lifetime income guarantees
They can work together.
If the market drops, your income plan doesn’t have to collapse—because some of your plan can be built on guarantees.
And when you compare annuities properly, you may find:
- higher income options than what you were shown
- designs that match your timeline better
- carriers that fit your rating preference (A-, A, A+)
My job is to help you see the full picture so you can choose what’s best for you, not what’s best for an advisor’s compensation model.
👉 Start with the calculators, then book a call if you want me to help you narrow it down.
Conclusion
Advisors tend to love or hate annuities because of:
- how they get paid (AUM vs commission)
- their investing philosophy (growth vs guarantees)
- incentives tied to specific products or carriers
- lack of side-by-side comparisons
Annuities aren’t automatically “good” or “bad.”
They’re a tool.
The real question is:
What do you need your money to do in retirement—growth, income, or both?
Need help with finding the best annuity for your retirement?
Click here to schedule a call with me.
On the call, I can help you:
- Determine what type of annuity is best for you
- Find the highest paying annuities for your unique situation
- Answer any other questions you may have