Money Helps
By Ellen McGirt

(MONEY Magazine) – Q. I think the financial adviser who sold me a fixed annuity made a big mistake when he invested my money—a goof that, by my math, cost me about $6,000 in interest. I've complained to the adviser, his brokerage and the National Association of Securities Dealers, but no one will do anything. EUGENE CASAVANT -- IRVINE, CALIF.

A. You thought right, Eugene. You lost out on $5,522 in interest last year because the adviser invested your money in two installments rather than a single big one. As for why no one seemed to act upon your complaints, you were complaining to the wrong people.

Fixed annuities and their salesfolk are complicated beasts. This product, Midland National Legacy Bonus 11, underwritten by Midland National Life Insurance, is called an equity-indexed annuity and is one of the most complex in the whole menagerie.

First, like all fixed annuities, yours allows your money to grow tax-free until you withdraw it in retirement. Also, a fixed annuity comes with no prospectus, just sales literature and fine print. And this baby has plenty of fine print. Start with the interest rate, which is set by a formula linked to various stock indexes. On top of that, the insurer offers new investors a bonus rate (11% for the first year). That, it appears, is what moved you to invest $140,000.

The catch is in how the investments are made. The annuity has a rule: Only the first investment can be applied to the funds offering the highest returns; subsequent investments go into a fund that paid just 2.5% last year. So when your adviser did not deposit the whole $140,000 at once as you expected, you lost out. Oops.

Complaining to the National Association of Securities Dealers (NASD) sounded like the right thing to do, but here's catch No. 2: Fixed annuities are insurance products, regulated by state insurance commissions, not the NASD. Although your adviser is licensed to sell annuities (we checked his record at, those sales aren't supervised by his brokerage. While selling annuities, he was working as an independent agent (as many financial advisers do) for the insurance company behind the annuity.

Confusing, I know. We asked Midland for a thorough review. The mistake was explained, and you were promptly sent a new statement listing the additional $5,522. Midland would like us all to know that this resolution should not be construed as an admission of wrongdoing on anyone's part. You're satisfied, so that works for us. Next time make sure you understand the quirks of any annuity and put your investment directives in writing.

Q. We applied online for a Discover card and were promised a $50 gift certificate 45 days after the first billing. Hasn't happened. I've phoned Discover's customer service department a half-dozen times; I've been hung up on, put on hold, transferred and had my "information taken." Still nothing. It's 189 days and counting! DEAN ADAMIAN -- CANTON, OHIO

A. Turns out, Discover had a promotional partner,, that was responsible for fulfilling the order. (If you had printed copies of the Web promotion—a good record-keeping habit to get into—you'd have found the name and contact information.) Complaining to the call center at Discover made sense, but the center wasn't equipped to answer questions related to promotions run by outside vendors.

Less than a week after we phoned Discover, the company arranged to have your $50 certificate dispatched overnight and apologized for your unfortunate experience. I understand that you gave the certificate to a local charity. You're right: It was the principle.

If something like this happens again and you can't locate the vendor, ask for the call center's supervisor and say you'll cancel the card unless the center tracks down the name and number of the promotional partner for you.