A Favorite Publication

NEMESIS

I see this blog as fairly wide ranging but confined mostly, though not totally, to investing.  But investing is only one part of the whole financial literacy area.  So, like most of you, I constantly seek out information in other pockets of the financial arena.  I view this effort somewhat like a video game where there exists an evil nemesis seeking to thwart my efforts and my task is to get information from various sources to attain a "golden key."

My information sources are wide and varied.  I have smart friends who reveal valuable tidbits, informative television programs I watch, blogs I read on a regular basis, and publications like Money Advisor by Consumer Reports.

I rarely endorse a product in this blog, but Money Advisor is worth endorsing.  It can be had for $49 for 2 years.

Let's take a look at the June issue.  Subject areas include Health Care (can you afford helping an aging relative), Investing (portfolio prep for a rise in interest rates), Retirement (fixed versus variable annuities), Spending (moving and storage scams), Taxes (when to amend a tax return).  There are also a number of regular columns.

Some of the info is of a "feel good" nature.  For example, they polled 169 readers and found that 47% of them had made a financial mistake costing more than $20,000.  See, now you don't feel so bad.

Other info is highly practical.  For example, in some states, sales taxes on a new car can be greatly reduced by trading in with the dealer rather than selling privately.

Annuity Research

What I like the best, though, is the research they do that can save me a lot of time.  Here is a table (p. 5) showing the monthly payout for a $100,000 immediate pay fixed annuity from the 10 highest payers out of 20 they surveyed.  These payouts are before taxes for a 65-year-old male living in New Jersey.

Insurance Company	Monthly Quote (No Guarantee)	10-year guarantee to beneficiaries	Weiss Ratings of financial strength
N. American Co. for L&H	$578	$556	B
Allianz	565	542	C+
Kansas City Life	561	541	B
Nationwide	549	530	B
American National	546	527	B
American Equity	544	531	B
Pacific Life & Annuity	541	529	B+
American General (AIG)	536	520	B
USAA	533	516	A
MetLife	526	509	C

Sources:  ImmediateAnnuities.com, USAA, andWeissWatchdog.com.  Quotes are for 3/22-29, 2013.  A is excellent, B is good, and C is fair.

As you can see, there isn't a big difference among the payouts; and it doesn't cost much to get a 10-year guarantee. 

Interestingly, the immediate pay fixed annuity is the one annuity that makes some sense for many people (for at least up to 20% of their assets) entering retirement, but most investment managers (even RIAs with their fiduciary status!) won't recommend because it subtracts from their investment fees.

This is the type of valuable research, succinctly, that can save a reader a lot of time.

Disclosure:  I am not associated with Consumer Reports in any way.  The purpose of this post is solely educational.