Retirement and Annuities
The Ideal Retirement
For most Americans, the ideal retirement includes these four main characteristics:
Safety – They don’t want to lose their hard earned money, especially knowing they can’t re-earn it.
Growth – Eighty percent of those surveyed said they prefer moderate growth with safety instead of higher potential with risk and volatility.
Tax Management – Most people believe taxes will go up in the future, so their ideal retirement strategy offers a way to control or limit taxes.
Liquidity – Those nearing retirement want a strategy that enables them to live confidently throughout retirement, taking income as necessary.
How would you feel if you knew that your money would never again take a plunge because of market swings? If you are tired of the market’s roller coaster ride, but want more growth than the minimal returns that bank CDs offer, then annuities may be a good fit for you. Take control over your retirement without having to spend your time studying the market and guessing its next move.
An insurance product does exist that enables you to protect your savings, earn steady growth and have funds available when you need them. It’s called a Fixed Indexed Annuity. Linking an index with a Fixed Indexed Annuity insurance product provides protections from market volatility and can be a “safety net” for your savings, while providing opportunity for competitive growth within the context of an insurance product.
One study by Zebra Capital and Roger Ibbitson, finance professor at Yale, found that historically, Fixed Indexed Annuities can potentially out-perform bonds with better downside protection4. If you are tired of market volatility, but want more growth than the minimal returns that bank CDs offer, then a Fixed Indexed Annuity insurance product may be a good fit for you.
An annuity is an insurance contract between you and an insurance company that is designed to help meet retirement and other long-range goals. To fund an annuity, you can either transfer your money in one large payment or you can make a series of payments.
In return, the insurance company agrees to pay you a specific amount of income per month, quarter, or year. This income can start immediately or at some future date, depending on the type of annuity you purchase and the options available within that annuity. Income is paid for either a chosen period of time or even for the remainder of your life. An annuity is an insurance product and is sold by licensed insurance producers.
The purchase of an annuity insurance product is one of the fastest-growing retirement strategies in the U.S. Last year, consumers moved more than $230 billion dollars out of the stock market or banks and into the purchase of annuities … to reduce or eliminate risk and to get their savings growing again. A recent Gallup Poll of over one thousand annuity owners reveals a striking contrast between the American population at large and those who purchase an annuity. While most national polls show a decline in consumer confidence in retirement, more than half of annuity owners believe that they have enough or more than enough money to cover their financial needs in retirement. Ninety-three percent are happy with their annuity purchases and still own their first.
At this point, the process for getting more details on annuities consists of you and I meeting for an initial discussion. This is not a sales meeting, but rather a time for you to talk about your current situation and future goals, as well as ask questions you may have from this course.
If your questions are answered to your satisfaction and we both agree that moving forward with another meeting would make sense, then we will schedule that at the end of our first meeting. There is no obligation in this first meeting. The goal is for you to explore your options and decide how you would like to proceed.
Indexed annuities are insurance contracts that, depending on the contract, may offer a guaranteed annual interest rate and some participation growth, if any, of a stock market index. Such contracts have substantial variation in terms, costs of guarantees and features and may cap participation or returns in significant ways. Any guarantees offered are backed by the financial strength of the insurance company. Surrender charges apply if not held to the end of the term. Withdrawals are taxed as ordinary income and, if taken prior to 59 ½, a 10% federal tax penalty. Investors are cautioned to carefully review an indexed annuity for its features, costs, risks, and how the variables are calculated.
For more information about any of the products and services listed here, schedule a meeting today or give us a call.