The need for nursing home care is ever expanding as the baby boomers age. With the increasing numbers of those needing care coupled with the increase of life expectancy, more and more care is needed. The question is simple, who will pay and how will they pay. In 2012 the average cost of nursing home care exceeded $70,000 for a semi-private room on a national basis. By 2040 the percentage of elderly individuals in need of nursing home care could exceed 15%.
Let’s face it, if all the market did was go up, the need for annuities would not exist. The reality is the market goes down, sometimes drastically. The 90’s exposed millions to the rewards of investing. The last four years showed the frightening side of the market. The fixed/indexed annuity plays well to people because of its combination of protection and potential.
Here is a secret about insurance companies, a secret that puts everything in perspective. Insurance companies do not make decisions based on individuals; they make decisions based on a large pool of people. Their tool? The Commissioners Standard Ordinary Mortality Table, known as CSO. The statistical table allows insurance companies to know exactly how many people nationally in a specific age group will die. It is not a guess, it is pure science.
Selling bonds as an income is ok, but other options are much better and using them does not mean your account can be affected by increasing interest rates, actually the opposite is true. Fixed Indexed Annuities can provide the very income Boomers are looking for and without compensation being charged directly to the Boomer. Plus a variety of options exist especially the BIG one, income can never be outlived.
Red money is good for those with a distant time horizon and have the time to regain any losses from a market downward move. You might be asking yourself, “What green money options are there other than cash, checking, saving account, or bank certificate of deposit?”
Albert Einstein was quoted saying that tax deferral (compounding) is one of the greatest inventions of the modern world. Not only is tax liability deferred but by doing so but you can increase the compounding from double compounding to triple compounding.
Ask yourself this: “ Is there anything about my financial professional or what he or she is recommending that guarantees my money will not participate in market losses?” Then ask yourself what I want my financial professional to do with my money. When I ask that question I usually get one answer: “I want it to grow and I want it to be safe.“
There are numerous reasons for owning an annuity but the most often considered reason is using an annuity for income. Annuities possess a wonderful feature; an annuity will guarantee income for as long as a person wants, even for an entire lifetime. If you are considering exploring an annuity and are interested in getting an annuity quote, here are a few simple rules.