According to Eric Ross, CFP, a financial planning specialist with Truepoint Wealth Counsel, "a fixed annuity is one way to control volatility risk."
"You're transferring risk from the market to the insurance company and trading a volatile asset class for a reliable asset," he added. "But if you have a sufficiently long time horizon, a balanced portfolio will serve you better in building wealth."
Marcio Silveira, CFP and founder of Pavlov Financial Planning, said there is a more subtle problem that may affect many NAPFA-registered advisors.
When a longevity annuity is purchased, there is less money to be invested in the advisor-managed portfolio," Silveira said. "So this means [fewer] assets-under-management fees for the fee-only advisor.