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.
Most people know the amount of money in their retirement plan and as they near retirement the focus on those funds becomes more and more important. Don’t forget the very most important questions you should be asking yourself about your retirement money.
I believe that the basis of all long term investing that concern funds for retirement should be in something safe and secure and free of risk. I also believe that a portion of your long term retirement funds should have some degree of risk. With risk comes the possibility of gain, gain can help offset inflation and add to the retirement pot.
While dollar cost averaging does not by itself shield investors from market downturns, continuous and scheduled purchases over an extended period of time tend to cancel out the ups and downs of the market, and leave the investor with a net gain and a minimized risk. A variable annuity is more suited for taking advantage of dollar cost averaging because it allows for a specific portion of your annuity investment to be transferred tax free on a monthly into equity portfolios.
The Treasury has reiterated the need for “longevity income” for plan participants and outsourcing the responsibility to insurance companies seems like a good fit. Many companies build their portfolio around the need of their customers income needs lasting a long period of time. Insurance companies can reduce the risk of an individual making eh incorrect decision with their important assets.
Most people can get the money they need for retirement without gambling heavily on equities, they just don’t know where to look. I’m in the business of helping Baby Boomers retire and post-retirees stay retired. My clients enjoy a hassle-free retirement; our planning assures safety, lifetime income, and potential for attractive returns—all while maintaining control of your money.
Profitable assets which offer fixed term annuities are a popular vehicle for investments. Faced with a volatile economy, one needs to think not only about securing your future with investments, but also investing in such a way that the investments themselves are secure.
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