Transamerica Principium III Variable Annuity Review

Today’s review is on the Transamerica Principium III Variable Annuity. The purpose of this review is to show you the strengths and weaknesses of this Annuity. In order to make an informed decision, it is important to consider all available facts.

  • Product type
  • Fees
  • Investment options that are available and their realistic long-term investment return expectations
  • How it can best help your financial plan
  • How it’s most poorly used as part of your financial plan

Transamerica Principium III Variable Annuity Quick Facts

Product NamePrincipium III
IssuerTransamerica Corporation
Type of ProductVariable Annuity
Standard & Poor’s Rating“AA-” (Great)
Phone Number
+1-(800) 797-2643

This review of Transamerica Principium III Variable Annuity is an independent review at the request of readers. Intended to explain my perspective when breaking down the positives and negatives of this particular model annuity. This is an independent product review, not a recommendation to buy or sell an annuity. Transamerica has not endorsed this review in any way, nor do I receive any compensation for this review. Before purchasing any investment product be sure to do your own due diligence and consult a properly licensed professional, should you have specific questions related to your circumstances. This review is not intended to give specific advice and your adviser may know more about your circumstances to make an appropriate recommendation. All names, marks, and materials used for this review are property of their respective owners.

Before we go into the review, some information on Transamerica

The Transamerica Corporation is an American holding company for various life insurance companies and investment firms operating primarily in the United States, offering life and supplemental health insurance, investments, and retirement services. As the company has major offices located in Baltimore, Maryland; Cedar Rapids, Iowa; Denver, Colorado; Norwood, Massachusetts; Exton, Pennsylvania; Harrison, New York; Johns Creek, Georgia; Plano, Texas; and St. Petersburg, Florida. Additional affiliated offices are located throughout the United States. In 1999, it became a subsidiary of Aegon, a European financial services company headquartered in The Hague, Netherlands.

Also Transamerica funds the Transamerica Institute, a nonprofit foundation comprises the Transamerica Center for Retirement Studies and the Transamerica Center for Health Studies.

There are a few ways that Agents might pitch Transamerica Principium III Variable Annuity

  • Guaranteed Rate of 5.5%
  • Low Fee Annuity
  • Tax-deferral
Annuity Classes

Is any of this True? 

The Transamerica Principium III works like any other variable annuity in the marketplace with a 5-year surrender charge that allows you to defer your money until you surrender the contract.

 In the product brochure guide, they said this annuity is a lower-cost variable annuity but is this really true? Well, I encourage you to keep reading because what you are going to find out it’s incredibly terrifying. We’ve been doing variable annuity reviews for a long time in AnnuityEdu.com to educate retirees on the high fees that these products have, but this annuity variable annuity can come up as top 1 worst variable annuity ever reviewed on AnnuityEdu. I will be reviewing all variable annuities on Transamerica Corporation for the upcoming weeks, so people can really be aware of this company’s products and hopefully never get trapped in it.

 Fees for Transamerica Principium III Variable Annuity:

Surrender Value Charges

Contract Year123456
Surender Charge %5%4%3%2%1%  0%  
Fee TypesPrincipium III
Policy Value Fee0.85%
Mortality & Expense Charge1.15%
Return of Premium Fee1.30%
Annual Step-up1.50%
Retirement Income Choice Benefit Rider (Income Edge)0.70% – 1.55%
Retirement Income Max Rider1.50% –1.60%
Additional Death Benefit Rider (optional)0.40%
Return of Premium Rider (optional)0.20%
Access Rider0.35%
Fund Fees (Group A, B and C)0.35% – 2.00%
Aprox. Current Fees without riders3.45%
Aprox. Current Fees with riders8.35% – 10%

If you are wondering if hat 8% in fees it’s true, you guessed right! It is absolutely true. If you choose all the riders in this variable annuity you can get an 8%+ fee. It is really unbelievable how high the fees for this annuity are. This information was taken from the prospectus, which I’m going to linked here so you can see it for yourselves.

transamerica principium iii

I tried really hard to look for something to defend in this annuity, but it was very difficult to find anything. Maybe the only positive aspect of this annuity is that if you bought the Access Rider you will be able to withdraw your money with no penalties. And that’s what you should be doing if you have this annuity, you should get out of it right away!


Let’s just give a hypothetical example if you purchased this annuity for $100,00 with the 8% fee, your account value would be drawing $8,000 per year. In case, the annuity nets 5.50% your account value would be losing $2,500 per year every year for the time you have this annuity. In other words, you’d be giving away your money to the insurance company just to have a fake guaranteed available.

These types of fees are most of the time hidden by sales agents, since they just want a commission and don’t care whether you preserve your money or not. Therefore, you should always go for a fiduciary advisor that puts your interest before his and give you the best advice for your current financial situation.

Also a Certified Financial Planner is the highest accreditation in the industry, and if you want to meet with one and run a complementary retirement income analysis check the link below and schedule a free meeting.

For More Information Click Here!

Investments for Transamerica Principium III Variable Annuity

After we reviewed the fees for the Transamerica Principium III Variable Annuity maybe you had made up your mind already, however for the sake of this review I’m going to explain investment options for this annuity.

As there are a variety of funds to choose in this annuity, from U.S Equity. So make a choice in fixed Income and International Funds to Asset Allocation and Hybrid Allocation funds. And if you should the living benefits, your options will be narrow down to 3 groups, Group A, B and C, which each have their own allocation funds in it. Group A has 1.85% fee, Group B 1.40% and Group C 0.95% fee for single life.

So if you want to know more about the investment option performances for this annuity click here!

Transamerica Principium III Variable Annuity Riders

Living Benefits

Retirement Income Choice 1.6

As this income rider allows you to growth and protect your income base regardless of market conditions, however it comes with a high fee. So what it basically does it to promise your lifetime income as long as you don’t exceed your withdrawal percentage. This rider as most income rider in simple words, is going to allow you deplete all your money to then give your lifetime income. More Info here.

Transamerica Income Edge

As this rider allows you to withdraw your own money at a 6% rate for single life and 5.5% joint life, only if you don’t withdraw any money for the first 10 years of the contract. So, think about it? They are making you withdraw only 6% of your money after 10 years for a fee, does it make sense to you? Well, it certainly does not make sense to me, but it is how it is. They tell you that if you buy this rider, they will eliminate the M&E fee, but you still have the other fees, and you are adding this one. More info about this rider here.

Retirement Income Max

So, let’s take a look at how the brochure sells you this rider. They promise you 5% compounded growth and income on your income base account, but what about your cash value? With the 8% fee and 5% guaranteed your account will be depleting every year 3% or more with the only consolation that you are going to receive lifetime income. This does not look good, who wants to run out of money? What if the lifetime guaranteed does not keep with inflation by the time you retire? What if you want to take all your money and put it into a better investment? You won’t be able to! Because the fees are going to drain your real money. That is the reality of these income riders and this annuity. Read it for yourself here.

Enhanced Death Benefit Riders

transamerica principium iii

Additional Death Distribution (ADD)

As this rider pays you an additional amount on based on rider earnings if any, however it is only available after 75 years old and if you buy the Return of Premium and Annual Step-up death benefit rider.

Additional Death Distribution + (ADD+)

This rider is supposed to pay an additional amount based on the benefit base, when a death benefit is payable during the accumulation phase, meaning that if the person dies during the accumulation phase the death benefit will be equal to the premiums paid minus any withdrawals. This rider is only available after 75 years old.

Access Rider

As I mentioned before the only good thing that this annuity has to offer is this rider, that allows you to withdraw your money without penalties. So if you have this annuity use this rider right away!

This Annuity works Best:

  • Highest Fees in the marketplace
  • Free surrender rider.
  • Tax-deferred growth.
  • For those looking for lifetime income
  • For those looking to deplete their money in record times

This Annuity Works Worst:

  • For those looking for low fees
  • Those who need liquidity.
  • Wealth preservation and protection

To Summarize

After analyzing the Transamerica Principium III Variable Annuity, we can conclude that the only purpose of this annuity is to deplete all your money and sell you the hope of guaranteed lifetime income for your peace of mind. Through many years of experience, I’ve seen many people involved in these kinds of annuities and feeling trapped because they weren’t aware of the high fees the variable annuities really have. If you want of these people feel free to contact us so we can help deal with this situation.

As I mentioned in many of these reviews, before taking such an important decision as buying an annuity. It is important first request the opinion of an expert. That looks for your best interest first and not a sales agent that just wants the commission. Thus this is why I encourage you to meet with Certified Financial Planner to do a retirement income analysis. And see if an annuity is good for you or not because before knowing the actual numbers. It would be impossible to know what is the best path for you to take financially. So any person that tells you otherwise simply just wants to take your money. Also he is not experience enough to give you advice. Remember that the numbers matter and they never lie!

For More Info Click Here!

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