Investment products heavily promoted by commission-based salespeople often deserve extra scrutiny. Here's what you should know about four commonly pushed financial products:

Equity-Indexed Annuities

These insurance products link returns to stock market performance while promising protection from losses. However, they typically:

• Limit your gains during market upswings
• Come with high commissions
• Include substantial surrender charges
• Feature complex contract terms
• Function more like bond alternatives than stock investments

Reverse Mortgages

These loans allow homeowners 62+ to tap home equity without monthly payments. Key considerations:

• Interest accrues monthly, increasing the debt
• Can deplete home equity completely
• May limit future financial flexibility
• Best suited for those who:
  • Need to avoid foreclosure
  • Plan to stay in their home long-term
  • Don't need equity for future expenses

Non-Traded REITs

While these real estate investment vehicles offer tax advantages, they have significant drawbacks:

• Money can be locked up for years
• High upfront fees reduce returns
• Complex structure
• Limited liquidity
• Generally underperform publicly-traded REITs

Cash-Value Life Insurance

These policies combine death benefits with investment features but have limitations:

• High premiums compared to term insurance
• Significant fees and costs
• Non-deductible premiums
• Complex terms
• May be unsuitable for many investors
• Better alternatives often exist, such as:
  • Term life insurance plus separate investments
  • Tax-efficient brokerage accounts

Before purchasing any of these products, consult a fee-only financial planner who can provide objective advice based on your specific situation and goals.

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