I would like to respond to the most recent topic that you posted on your Web Site concerning Variable Annuities in a 403b or other qualified accounts. First, I am a registered rep and Certified Financial Planner. My company does traditional commission based work as well as Fee based and hourly rate services. I have been in the business for 18 years and have over 14 years experience working with school districts and hospital 403b and 401k plans. Up until a few years ago, I would almost never consider putting a VA. inside a 403b account or any retirement account for that matter. The expenses are higher and for the Mortality And Risk Expense of approx. 1.65% on a VA.,( the death benefit that you recieve) is rarely worth the costs. However, I do find the new "Living Benefits" now available with many annuities more compelling in most instances for conservative to moderate risk investors than mutual funds! First off, there are several types of living benefits and for this discussion, I will focus on what is called a "Guarenteed Minimum Withdrawal Balance". Because a number of companies offer these "GMIB"s, and they can be somewhat complicted, I will use an example of one insurance companies product that I will call "XYZ" to illustrate: Mr. Jones purchases $100,000 into XYZ variable annuity with a guarenteed rider. The account is allocated say in an 80/20 mix of stock and bond sub-accounts. The rider guarentees that in the worst case scenario, (the sub-accounts drop as low as $0), than xyz company will allow Mr. Jones to withdraw up to 7% of what he started with ($7,000) per year until he gets back all $100,000. In this case, Mr. Jones would recieve $7,000 every year and it would last for 14.2 years. This is the worst case scenario. If the subaccounts make money, Mr. Jones has access to the entire value at any time! No Surrender charges! He can take immediate withdrawals or add to the account as 403b laws dictate. Also, after 5 years, Mr. Jones can lock in any gains if he chooses to stay with the rider and the 7% withdrawal will now be based on the higher amount. Example: $100,000 invested 6% ROR $133,822 contract value @ end of year 5 Mr Jones can now choose to guarentee the $133,822. XYZ will now guarentee that Mr. Jones will recieve @ least 7% of the $133,822 (if the account drops and never returns to this level) or $9367 per year until he recieves the $133,822 which would last another 14.2 years. Of course if the value goes up he can continue to repeat this cycle. The advantages of such a guarantee are numerous: 1) For those risk averse investors, this program gives them a safety net that they do not have with Mutual Funds. 2) It allows people whose risk tolerance may be low, say 40/60 or 50/50 to go to a higher equity allocation because they feel comfortable knowing they will get all of their money back in a worst case scenario. 3) Using past performance of the Stock and Bond markets, the higher equity exposure should @ least make up for the additional cost of the VA. Now, Lets take a look @ some of the charges, what you get or should get in return etc. I) MF/No-load II)MF/No-load III)"XYZ" Va Advisor Mgt Fee .75 .75 .75 M&E 0 0 1.65 Advisor Fee 0 1.00 Inc. Guar. Rider na na .50 Surrender charges 0 0 0 Fin. Planning & Ongoing Inv. na yes yes Advice Total .75 1.75 2.9 I) No load funds. You can find cheaper and more expensive annual fees. For the do it your-selfer who need no financial planning/ ongoing advice or guarentees. II) Same No-Load with a 1% annual fee charged by an advisor for those who want or need Financial Planning and ongoing advice. III) VA. with a principle guarentee. Investor get guarentee of principle financial planning and on going advice as well as a death benefit. While the Va has the highest fees, the investor may actually end up with more if they are able to have a higher % in equities than they would without it. As I said before though, I would rarely recommend a VA. inside the 403b if the guarenteed rider was not purchased! Also, this is not intended to be an exhaustive comparison of particular investments. There are much more details that need to be explored but this is just an example of how one might look @ the mutual fund vs. Annuity debate! In conclusion, I would just like to say that I think it would be unfair to paint all VA.'s in general with the same brush. As a number of your articles have suggested, not all low cost investments are the best and not all high cost products the worse.