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Ken Fisher's Resolve Unwavering as Insurance Marketers Cajole Advisors to Annuities

By Miriam Rozen October 15, 2018

Ken Fisher’s own high profile and his firm’s more than $106 billion under management, paired with his well-known disregard for annuities, have made him a persistent target for criticism by other advisors. But those attacks have been reinvigorated most recently by the so-called Alliance for Lifetime Income, a newly-formed marketing coalition of insurance companies trying to rebrand annuities as a simple solution to retirement insecurities.

Some other advisors and the Alliance contend Fisher is doing a disservice to investors and retirees by using a broad brush to disparage annuities.

“I think Ken Fisher is out of his mind,” says Ross Gerber, CEO of Santa Monica, Calif.-based Gerber Kawasaki Wealth and Investment Management, which has more than $840 million under management.

Gerber recommends some of his clients use annuities judiciously — not throwing all of their wealth into the asset class. He has some of his clients relying on variable annuities for core income creation. “No other investment can guarantee income,” Gerber says.

“Annuities are so easy to bash because of their fees,” says Janice Hobbs of Jan Hobbs Financial Group in Orange, Calif., which is affiliated with LPL Financial. But all the focusing on fees overlooks their advantages, she says.

“I’m pro-guaranteed lifetime income,” says Hobbs, who has annuities in her own portfolio as well as those of her clients. “The sleep at night,” not worrying about market fluctuations, is worth the fees, she says.

We're not surprised the annuities and insurance industries are attacking us with false and unsubstantiated claims.
Fisher Investments

Officially, Jean Statler, the executive director for the Alliance and a marketing firm executive, adopts an olive-branch approach to Fisher. Statler writes in an emailed statement for this story that members of her new organization “are always open to talking to those in the industry who share our mission of ensuring all Americans secure guaranteed income for life.” She adds about Fisher specifically: “Have him give us a call.”

Earlier this month, the marketers for the Alliance, which counts AIG and Prudential among its corporate members, launched a campaign with the slogan: “Retire Your Risk” and told reporters about plans to provide gratis new online software tools aimed at reintroducing annuities, including variable annuities, to financial advisors, their clients, and directly to retirees.

For its part, Fisher Investments and its founder remain steadfast in their disdain for annuities.

“We are not surprised that the annuities and insurance industries are attacking us with false and unsubstantiated claims. Our public position on annuities and similar ‘guaranteed’ products could not be more clear and consistent. Investors can best meet their needs with other approaches,” the firm said in an emailed statement in response to an inquiry for this story.

Ken Fisher

In fact, Fisher Investments offers a credit on accrued management fees to clients who incur a charge for surrendering an annuity — an offer it has promoted for years.

In written pamphlets about annuities aimed at prospective clients, Fisher Investments lists the instruments’ possible pitfalls — high surrender fees, shortfalls in inflation protection, and a lead-up to heirs’ loss of step ups.

“On the surface, annuities may seem a safe bet, especially during times of market volatility. However, they often have significant drawbacks that aren’t readily apparent to the average investor,” the firm’s written material concludes.