I used to sell life insurance and annuities. As far as I can tell, the major concern seems to be about the risk that comes from the downside risk of annuities,

I used to sell life insurance and annuities. As far as I can tell, the major concern seems to be about the risk that comes from the downside risk of annuities, which is that you can lose all your money. A close relative of mine bought an annuity from someone, that someone spent all the money from the annuity, and my relative ended up losing everything. Think of it this way... A 401k is a piggy bank into which you put your retirement savings. You pay a pig farmer a small fee every year to invest the retirement funds in various forms of stocks and bonds. The money is always yours, and you get to keep whatever is in the piggy bank, plus all of the gains/losses, after the pig farmer's fee. An annuity is going to a casino and making a bet. You give the bookie all of your money, and the bookie agrees to give you your money back in the future in regular payments over some period of time (e.g. pay in 10x now, and starting in 20 years, you get X per year until you die). If you live long enough, you can come out way ahead, but the bookie is really good at spreading the risk across people who, on average, collect less than they put in. The risk is that the bookie outright steals your money, or maybe puts the money in a safe, but someone steals the safe. If the bookie loses your funds, you may very well get nothing. Think Bitcoin - you give me 100 Bitcoins, I agree to pay you 1 Bitcoin a month until you die, I put the coins in a secure wallet, and forget the wallet's password.