Annuities Is the “Market” for Retirees’
The current state of the economy has a lot of people thinking about the future, and now is the perfect time to consider annuities. Key decisions about retirement income shouldn’t be put off, specifically in uncertain economic times. The turmoil has made people more aware of the need to understand where their money is going and how it fits their needs.
Historically 100% of all ten-year periods of “the market” have made money and 97% or every five years the “market” has made money, so it is very likely that the “market” to come back. It can take 5 to 10 years, but will rise again. However, retiree or near retiree’s should balance risk and stability?
When the economy changes, which investments are going to do well is going to change. An investment that’s good today, six months from now is probably not going to be the right place to be.
Stock markets may have rebounded somewhat, however, there is no investment that is good for all times, but no matter what times are doing, there are some investments that are good. Near retirees’ and retirees’ are not ready to dive back into equities, rushing instead to the safe and relatively still waters of guaranteed annuities.
Americans for a long time have relied on other things, including growth in the value of their home, growth in the value of their 401(k) or other things as a substitution for savings. That has worked for this period of time. However, it is not likely to continue to work in the future and this is where annuities really shine.
For most people, ignoring this financial product is simply not an option. And while it may not be suitable for all people, it is usually included in one form or another in most retirement plans. During times where the economy fluctuates investments have to be monitored closely, but not an annuity. Annuities are a great supplement to your retirement if you position yourself to take advantage of their tax advantages and if you have put adequate funds into more traditional retirement accounts.
Fixed Indexed annuities: FIAs are fixed annuities linked to the performance of a stock market index without the risk of loss in accumulation value because of negative stock market performance. FIAs can sometimes bring returns better than CDs, bonds, or money market accounts.
Fixed Indexed Annuities offer principal protection and a chance to benefit from market gains. During the accumulation phase of an FIA, you have the opportunity to benefit from positive stock market performance, and are protected from loss due to negative stock market performance.
An FIA annuity contract usually guarantees you a minimum rate of interest on your purchase payments while the annuity is growing. The insurance company involved will credit you with either the minimum return stated in the contract or a return based on the performance of the linked index.
A recent Wharton School / New York study of life, this may be The most effective means to ensure stable profitability level of retirement income, regardless of how long it lasts. Fixed Indexed annuities are wonderful products for the risk averse and people nearing retirement. Fixed annuities are the only product that can offer solid rates of pay and guaranteed income without having to constantly manage investment accounts as market changes.
What are immediate fixed annuities? Just as the heart and circulatory system delivers the essential blood flow to the human body, cash flow is the delivery system within a financial plan. These are annuities that are as they sound, fixed and provides’ cash flow. That means that you can depend on the amount that you are getting no matter what happens. That can add some peace of mind to your retirement plan as well as securing whatever amount of money you were planning on leaving behind to your family.
