At first glance, an annuity might seem like a great retirement solution for the average guy - especially if you happened to run into a large sum of money. Well, not so fast.

I definitely believe annuities are not right for the average Joe or Jane looking to retire. They definitely have their purpose - and it is certainly not to be your sole solution for future planning.

You see, there's one inherent and big problem with annuities - actually, there's a few. For one, the payments are absolutely 100% fixed. Secondly, once you hit the date when payments start, there's no turning back. Third, your money never accrues interest (in most plans, at least).

Even if your money does gain interest, is it 12%? Heck no. But 12% is what your money could be getting on the world market.

Actually, it is accruing 12% - but not for you. The company holding the annuity is getting that 12%, and passing the "savings" on to you by charging you administrative fees so they can invest your money for their benefit.

So who would ever want an annuity? Well, if you don't have any options left for stashing your cash away from Uncle Sam, then an annuity is a great idea. Other than that, there really is no reason for an annuity.