Running out of money in retirement is such a major concern that many workers fear it more than death itself. And while aggressively funding an IRA or 401(k) during your working years will help lower your risk of depleting your savings in your lifetime, it won’t guarantee that you don’t wind up strapped for cash when you’re older.

An annuity, on the other hand, can help eliminate that risk. An annuity is a contract between you and an insurance company. With an annuity, you’re essentially paying a lump sum of money in exchange for guaranteed payouts for life. Those payments might start right away or begin at some point in the future.

Sounds like a pretty good deal, right? Not necessarily.

While annuities are a smart investment in theory, there’s a reason they tend to get a bad rap. For one thing, they can be awfully confusing and come with their own complicated tax rules and implications. Furthermore, annuities are only as good as the companies that issue them. If you buy an annuity and the insurance company behind it goes under, your so-called guaranteed income stream disappears.

But if there’s one aspect of annuities that really drags their name through the mud, it’s none other than fees. And that’s something you need to be aware of before you buy.

Let’s be clear: Most investments come with fees in some shape or form. But annuities take that concept to a whole new level.

First of all, annuities are frequently (though not always) sold by pushy sales reps who land huge commissions for getting you to buy them. Those commissions can easily hit the 10% mark, and they’re often built into the annuity’s operating costs, which means that charge is passed along to you, the buyer.

Speaking of operating costs, it’s not unheard of for annuities, particularly variable ones, to charge 3% to 4% in annual fees. Actively managed mutual funds, by contrast, might charge as little as half that amount. Granted, you’re not getting guaranteed income for life with a mutual fund, but it’s something to consider nonetheless.

Another thing to know about annuities is that they typically come with surrender charges, which means that if you attempt to back out of your contract, you’ll be hit with a hefty fee there as well. That fee can be as high as 7% during the first year of your annuity, though it’ll typically decline by about 1% annually during your surrender period until it goes away completely. That said, some annuities allow you to withdraw a small portion of your account value each year without facing a surrender charge, but that depends on the specifics of your contract.

So are all of those fees worth the guaranteed income? Part of it depends on how long you end up living. If you pass away sooner than expected, you may not end up recouping those fees, or your initial investment, for that matter.

Despite their complexities and sizable fees, annuities can be a smart choice under some circumstances because unlike your IRA or 401(k), they essentially guarantee income for life, provided you pick the right insurer. That said, it generally pays to max out your retirement plan contributions before buying an annuity. But if you’re sitting on extra cash and don’t want to bear the risk of investing it on a long-term basis, an annuity might work out in your favor.

The same holds true if your health is fantastic and you have a strong family history of longevity. That’s because the longer you live, the greater your chances of getting the most out of your annuity.

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On the other hand, if you can’t wrap your head around annuities enough to understand how they work, you may be better off putting your money elsewhere. Remember, annuities technically aren’t risk-free, and if the idea of buying one doesn’t sit well with you, that’s reason enough to explore alternatives for establishing an income stream for life.

CNNMoney (New York) First published May 25, 2018: 10:43 AM ET

President Trump vowed Monday that the tax break for 401(k) plans will be kept in place under the administration’s tax reform proposal, despite reports to the contrary.

“There will be NO change to your 401(k). This has always been a great and popular middle class tax break that works, and it stays!” he tweeted early Monday.

Republicans have been discussing sharp reductions in the amount of money that could be invested tax-free in the popular retirement accounts, according to reports over the weekend in numerous news outlets. Among those working on tax reform, the 401(k) deduction has been part of those discussions for months.

To offset deficit increases caused by tax cuts, some popular tax deductions will need to be eliminated. For example, the deduction for state and local taxes is on the chopping block in current discussions.

Related: 401(k) contribution limit will rise to $18,500 next year

Despite Trump’s tweet Monday, there have been numerous instances where his promises have not been born out by actual legislation.

He promised repeatedly to make no cuts in Medicaid, then pushed for a replacement for Obamacare that would have made sharp cuts in money for Medicaid. He has repeatedly said that his tax plan would benefit middle income taxpayers and not the wealthy — even though independent analysis of the plan shows that it is the wealthy who stand to benefit the most.

CNNMoney (New York) First published October 23, 2017: 8:19 AM ET

What you’ll pay for a life insurance policy can vary dramatically; men pay higher premiums than women, older policyholders pay more than younger ones and smokers pay more than non-smokers.

But just how much does your age, gender or smoking habit cost you? InsuranceQuotes.com evaluated life insurance premiums for the top 25 carriers in the nation to find out.

Men pay an average of 38% more than women for the same coverage.

Here’s one area where women have a financial edge. Men are at a greater risk of cardiovascular disease, various cancers and accidental injuries and that makes them more risky to insurers. The average life expectancy of an American man is also five years younger than a woman’s, meaning an insurer is more likely to pay out on a man’s policy than a woman’s.

Smokers pay more than three times as much as non-smokers for the same policy.

Insurers can charge smokers three times as much as non-smokers, insuranceQuotes.com found.

Related: Stressful jobs that pay badly

A non-smoking 45-year-old woman, for example, pays $45 a month for a $500,000 term life policy. If she smokes, however, the premium shoots up to $167 a month. That’s $1,462 more a year.

If you can kick the habit, however, you can save big. Tell your insurer that you’ve been smoke-free for two years and they will usually lower your premium to the rate for non-smokers, said Laura Adams, an analyst for insuranceQuotes.com.

“That’s pretty generous,” said Adams. “It’s almost like you never smoked.”

Related: Why you don’t need to buy extra rental car insurance

But don’t tell your insurer that if it’s not true. If you do die of a smoking-related cause and your insurer finds out you never quit, they can deny the benefit entirely.

Get coverage young and save — but only if you need it

Most people don’t feel the need to buy life insurance until they have a child. And in general, that’s a pretty good rule of thumb.

If you have children in your 20s or early 30s you could save significantly on premiums by opening a policy while you’re young.

Premiums for 35 year olds cost about 27% more than those for a 25 year old.

“Term life [policies are] popular because they’re relatively inexpensive and people don’t need policies for their entire life,” said Adams. Many parents buy 20-year term policies to see their children through their college years.

CNNMoney (New York) First published July 24, 2014: 7:58 PM ET

McDonald’s is tripling the amount of money it offers some restaurant workers who want to pursue a college degree.

The company said it will allocate $150 million over five years to expand its existing tuition assistance benefit, an investment “accelerated by changes in the US tax law.”

Starting May 1, eligible restaurant employees can receive $2,500 a year, up from $700 previously, and managers can receive $3,000 a year, up from $1,050. The benefit is retroactive to January 1.

McDonald’s is also loosening the eligibility requirements. Employees will now qualify after 90 days of employment, instead of nine months, and will need to work a minimum of 15 hours a week, down from 20 hours.

Almost 400,000 workers are expected to be eligible for the program, nearly double the number previously, a spokesperson said.

16,400 employees were awarded tuition assistance under the more limited eligibility requirements since it launched in April 2015, according to the company website.

“By offering restaurant employees more opportunities to further their education and pursue their career aspirations, we are helping them find their full potential, whether that’s at McDonald’s or elsewhere,” said CEO Steve Easterbrook in a statement.

Workers can use the money to take classes at a community college, trade school, or four-year college of their choosing.

The average annual cost of tuition and fees at a community college is $3,570.

Related: Hotel industry wants to pay for their workers’ college degrees

About 55% of companies offer tuition assistance programs, according to the Society For Human Resource Management.

Some companies even cover the entire cost of a degree for workers. Starbucks, for example, has partnered with Arizona State University’s online program to make tuition free for full- and part-time baristas. Though unlike McDonald’s, Starbucks workers must pay up front and be reimbursed at the end of each semester.

Ten major hotel companies have recently launched a new tuition benefit to attract and retain good employes. Eligible workers will be able to get an online associate’s degree at no cost and an online bachelor’s degree at a subsidized cost.

CNNMoney (New York) First published March 29, 2018: 1:35 PM ET

Ryanair has introduced restrictive new baggage rules that risk upsetting passengers.

The budget airline said that customers will be allowed to bring only one small piece of luggage into the cabin starting in November. The bag must be small enough to fit under a seat.

Passengers will be required to pay to bring additional luggage into the cabin, or have it stowed.

Up to 95 customers per flight can pay £6 ($7.70) when they book for priority boarding and the ability to bring a 10 kilogram (22 pound) bag into the cabin. Another option is paying £8 pounds ($10.30) to have a 10 kilogram bag checked.

Ryanair (RYAAY) said the policy was changed to cut down on delays, and it does not expect to make any additional money. It previously allowed passengers to bring one small personal bag into the cabin, and stow a 10 kilogram bag without charge.

Ryanair is known for low fares and a no-frills ethos. It operates over 2,000 flights a day and carries about 130 million passengers a year.

It has been slammed by higher costs and a series of strikes in recent months as pilot unions try to negotiate collective labor agreements with the airline.

David Bentley, chief airports analyst at CAPA — Centre for Aviation, warned the new baggage policy could annoy passengers.

“The entire procedure is far too ‘messy’ with more and more regulations and that is not going to sit happily with leisure travelers in particular,” he said.

Analysts said the new baggage policy is among the most restrictive in the industry.

“This a potential game changer for passengers and the industry, if Ryanair can make the fee structure stick,” said Rob Byde, an aviation analyst at investment bank Cantor Fitzgerald.

“The airline is clearly trying to curtail overloading of the cabin but it also has its eye on a lucrative new revenue stream,” he said.

Unions that represent Ryanair pilots say they’re looking for better working conditions. The airline’s pilots and crew are not, for example, provided with free food or drinks.

“Ryanair expects all its people to pay for their drinks and snacks whether in the staff canteen or on board the aircraft. This is a ‘low cost’, not a ‘free food,’ airline,” the company said in an email to CNN.

CNNMoney (London) First published August 24, 2018: 9:55 AM ET

While annuities can make sense in certain circumstances, it’s important to be aware of the drawbacks before purchasing any type of investment.

And with annuities, the main drawback is the cost. They tend to have higher fees than many other investments, and in some cases, the difference can be huge.

If you think an annuity could be right for you, here’s a rundown of the fees and other costs you can expect to pay.

One major point you need to know is that many annuity fees either aren’t disclosed or are difficult to determine. So, just because a certain type of fee isn’t listed in your annuity contract or mentioned to you by an annuity salesperson, don’t assume you aren’t paying it.

With that in mind, here’s a list of some of the major annuity expenses you might pay, either directly or indirectly:

Commission: The salesperson who sells you an annuity gets a cut, and this can be substantial, as you’ll see in the next section. However, you can save yourself money by looking at direct-sold annuities, rather than going through salespeople (who may refer to themselves as “investment advisers”).

Management fees: Variable annuities are especially notorious for high management fees. These annuities invest your money in mutual funds, and the fees (known as expense ratios) charged by the underlying mutual funds are passed on to you.

Insurance charges: These are also known as mortality and expense (M&E) fees and administrative fees. These cover certain guarantees that come with an annuity, as well as administrative expenses.

Surrender charges: Annuities often have penalties known as “surrender charges” that discourage people from pulling their money out early.

Other fees: In addition to these common fees, other potential annuity fees include underwriting fees, IRS penalties for early withdrawals in certain cases, fees associated with riders (added features), and more.

Here’s the part to pay close attention to: Annuity fees can be astronomically high.

For one thing, annuity commissions often run in the 6% range, and commissions as high as 10% aren’t unheard of. As I mentioned earlier, you can avoid paying a high commission by looking at annuities sold directly by companies. Vanguard is an excellent example: Their annuity specialists don’t work for commissions and, instead simply charge a one-time 2% fee for income annuities.

You can also end up paying high fees on an ongoing basis if you buy a variable annuity. In addition to the costs of the underlying mutual funds, variable annuities come with insurance charges and other fees that can total 2%-3% per year in many cases. As with commissions, not all variable annuity fees are in the same ballpark. For example, Vanguard’s mutual funds are notoriously cheap, so this can save you money on an ongoing basis. And it’s not just Vanguard; other companies, such as Fidelity and TIAA-CREF, also direct-sell annuities that could be worth a look.

In addition, a surrender charge can cost you a lot of money if you decide you want to cash out. A typical surrender charge is 7% of the annuity’s value after one year, and it declines by 1% per year until it’s gone, although much higher surrender charges are possible.

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And finally, if you add any riders to your annuity, you can expect to pay an additional charge — or accept a lower ongoing benefit.

CNNMoney (New York) First published May 28, 2018: 2:41 PM ET

The tax bill unveiled by Republicans in the House on Thursday would not, as had been rumored, eliminate the tax penalty for failure to have health insurance. But it would eliminate a decades-old deduction for people with very high medical costs.

The controversial bill is an effort by Republicans to revamp the nation’s tax code and provide dramatic tax cuts for business and individuals. However, its future is not yet clear because Republicans, who control both the House and Senate, appear divided on key measures.

The medical deduction, originally created in World War II, is available only to taxpayers whose expenses are above 10% of their adjusted gross income.

Because of that threshold, and because it is available only to people who itemize their deductions, the medical expense deduction is not used by many people — an estimated 8.8 million claimed it on their 2015 taxes, according to the IRS.

Related: What’s in the House tax bill for people

But those 8.8 million tax filers claimed an estimated $87 billion in deductions; meaning that those who do qualify for the deduction have very high out-of-pocket health costs.

“For many people, this is a big deduction,” said David Certner, legislative counsel for AARP, which opposes the change.

AARP has calculated that about three-quarters of those who claim the medical expense deduction are 50 or older, and more than 70% have annual incomes of $75,000 or below.

Many of those expenses are for long-term care, which is typically not covered by health insurance. Long-term care can cost thousands or tens of thousands of dollars a year.

Sen. Ron Wyden, a Democrat from Oregon who is a ranking member of the Senate Finance Committee, called the bill’s elimination of the medical expense deduction “anti-senior.”

But defenders of the bill say the elimination of the deduction should not be seen in isolation.

The House tax bill also proposes eliminating billions of dollars in corporate tax credits that have played a key role in the booming “orphan drug” industry.

In an FAQ posted on the House Ways and Means Committee website, the bill’s sponsors denied that the change would “be a financial burden.”

“Our bill lowers the tax rates and increases the standard deduction so people can immediately keep more of their paychecks — instead of having to rely on a myriad of provisions that many will never use and others may use only once in their lifetime,” the sponsors said.

Getting rid of many current deductions “is being done to finance rate cuts and increase the standard deduction and child tax credit,” said Nicole Kaeding, an economist with the business-backed Tax Foundation. So, for many tax filers, she said, “there will likely be offsetting tax cuts.”

On the other hand, those offsetting cuts almost by definition will not make up the difference for people with very large medical expenses, who are the only ones who qualify for the medical deduction.

“That’s why tax reform is hard,” Kaeding said.

Related: These powerful groups hate the GOP tax plan

Strikingly absent from the bill — for now — is any reference to the elimination of the tax penalty for failure to have health insurance. The so-called individual mandate is one of the most unpopular provisions of the Affordable Care Act, which Republicans failed to change or repeal earlier this year.

Sen. Tom Cotton, a Republican from Arkansas, is continuing to push language to add to the bill that would eliminate the penalty. President Donald Trump has added his endorsement via Twitter: “Wouldn’t it be great to Repeal the very unfair and unpopular Individual Mandate in ObamaCare and use those savings for further Tax Cuts,” he wrote Wednesday.

But while the president is correct that there would be savings from eliminating the mandate, the Congressional Budget Office has also estimated that millions more Americans would become uninsured as a result.

Kaiser Health News, a nonprofit health newsroom whose stories appear in news outlets nationwide, is an editorially independent part of the Kaiser Family Foundation.

CNNMoney (New York) First published November 4, 2017: 11:00 AM ET

If you’re co-signing big student loans for your child, you may want to buy a life insurance policy while you’re at it.

While no one wants to imagine the death of their child, taking out insurance on your son or daughter — or asking them to purchase their own plan — will protect you from being hit with mountains of debt should tragedy strike.

And the policies are pretty cheap. A basic plan with up to $250,000 in coverage can cost as little as $15 a month for a young, healthy college student or recent graduate. That’s a whole lot less than the loan payments you could be stuck with — which average more than $200 a month.

Related: Parents hit with $200,000 student loan bill

Such a move would have been life altering to Steve and Darnelle Mason, who lost their daughter Lisa five years ago.

Trying to pay back the $100,000 in private student loans they co-signed for their daughter has been a financial nightmare.

“I absolutely wish we had [a life insurance] policy,” said Steve Mason. “We would not have struggled financially for the past four years with these private student loans, and our credit would not have been ruined.”

Federal student loans are forgiven by the lender when a borrower dies, but private lenders aren’t required to provide any such relief.

That’s one reason it’s important to get as much federal aid as possible before turning to private lenders. And for parents, it means not co-signing on a loan unless you have the means to repay it.

Another reason for caution: student loans can rarely be discharged in bankruptcy.

Related: Grieving parents receive student loan relief

But for many parents, getting their child a good college education is non-negotiable — and that’s when life insurance can provide a little peace of mind, says Eleanor Blayney, a certified financial planner and consumer advocate for CFP Board.

Jennifer Boughan, 47, purchased life insurance policies for her three daughters as soon as they enrolled in college. Each policy costs around $150 per year and provides $100,000 in coverage, enough to cover each girl’s $50,000 to $60,000 in private and federal student loans should something happen.

“These policies are in case — and God forbid — the worst that could happen, does,” said Boughan. “Seems to me that is a far better expense than to have to face the devastation of what comes after the tragedy of a lost child.”

Related: 3 things that drive life insurance premiums through the roof

After hearing about the financial blow some grieving families have faced, Joseph Barbano took out an insurance policy for his college-bound son.

Barbano hasn’t had to take out loans yet, but he thinks he may need to down the road and wants to protect himself just in case. The 20-year term policy he took out for his son costs less than $20 per month and provides $250,000 in coverage.

Shopping for life insurance

Before purchasing a life insurance policy for your child, check with your lender. Some private lenders have recently started providing relief when a primary borrower dies — including lending giants Sallie Mae, Wells Fargo and Discover. In these cases, insurance is generally unnecessary, says Mark Kantrowitz, senior vice president at Edvisors.

If your lender doesn’t offer any protections, then compare insurance quotes online to find the best life insurance plan. Websites like InsuranceQuotes.com, which aggregates information from hundreds of top-rated insurers, can help you comparison shop.

You’ll want to look for a term life insurance policy, which is a temporary policy where you can choose the length of coverage — say 10 or 20 years.

The coverage you get should be equal to the loan balance — $100,000 in coverage for $100,000 in loans, for example — and the loan term should be equal to the estimated repayment term of the loan, Kantrowitz recommends.

CNNMoney (New York) First published August 5, 2014: 6:41 PM ET

If you’ve been paying off student loans, don’t make the mistake of filing your taxes without getting a deduction on the interest you’ve paid on your loans.

“If you’re paying 4% [interest] on your loans and not getting the deduction,” says Michael Chen a CPA and founder of Henry.tax, “it is expensive and you’re not getting the full benefit.”

Who is eligible for the deduction and how do you claim a loan interest deduction?

Anyone paying student loans may be able to deduct up to $2,500 of the interest paid in the past year on a qualified student loan, according to the IRS. And that deduction will be claimed as an adjustment to your income.

The deduction is available to anyone earning less than $80,000 (or $165,000 if you file a joint return), but it’s gradually phased out if your modified adjusted gross income is between $65,000 and $80,000.

To find out if you can claim the deduction you can use this IRS Tool. You’ll need to know your filing stats, income, adjusted gross income and any expenses you’ve paid for education loans.

The deduction can reduce the amount of your taxable income by up to $2,500.

There are some other qualifications, too. The loan has to have been for a student enrolled, at least half time, in a program leading to a degree, certificate, or other recognized educational credential. If you took out a loan from a relative or through an employer plan, you’re out of luck.

You’ll want to talk this through with your parents if they’ve recently claimed you as a dependent or plan to. If you are obligated to pay the loan and they claim you as a dependent, neither you or they will be able to claim the loan interest deduction.

But, here’s an upside: If you’re obligated to make the interest payments and someone else pays for you — your parents, maybe — the IRS’s view is that you’re receiving the payments from the other person and, in turn, paying the interest. Consequently, you get to take the deduction.

Any borrower who pays more than $600 in interest should receive a Form 1098-E — a student loan interest statement from the lender.

On your 1040 form you’ll enter the amount of loan interest you’ve paid, up to $2,500.

The student loan interest deduction is claimed as an adjustment to income, which means you can still claim it even if you don’t itemize deductions.

CNNMoney (New York) First published April 6, 2018: 10:12 AM ET