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Oftentimes investors find themselves with unwanted annuity products that were sold to them by an insurance agent, broker, or bank salesperson.  While some annuities are appropriate for client needs, many contain high costs and contractual provisions that can have the effect of locking up your funds for a long time.  Even non-retirement annuities can have tax implications when you transfer or disburse the funds.  Adding insult to injury, many times investors find themselves without a representative for the annuity contract because the salesperson who set up the annuity no longer represents the carrier, or has washed out of the industry altogether.

Unbeknownst to the investing public, some annuity carriers offer contracts that are no-load, no-commission, fee-only style annuities.  It is possible that these contracts offer more flexible options, with a higher-rated carrier, at a lower cost.  Section 1035 of the Internal Revenue Code allows annuity contracts to be exchanged, and qualifying exchanges are tax-free.  This means that even non-retirement annuity contracts that have substantial unrealized gains can be exchanged into a lower cost contract without ordinary income being triggered on the exchange.