Insurance companies know two things are certain. Death and taxes. Both are guaranteed, so it is ideal to have the guarantee in your retirement savings that your money (at least a portion of it) is protected for your life and guaranteed to make you payments throughout your life and your spouses life so that you never run out of money in retirement. Were you set up to fail? Right now is your opportunity to learn the New Rules of Retirement.
Rule #1 – The Old Ways We Were Taught Are Gone and No Longer Work
The system (your retirement) is no longer on auto-pilot. Since very few companies offer a pension and even less employees spend over 7 years working at one company. The commonly offered investment vehicles 401K, IRA, 403B, 457 Deferred Compensation Plan, stock market investments, mutual funds, all continue to allow risk and downside potential exists with no protection, based on the market performance.
Most people do not have the training, education and knowledge to invest wisely for retirement and protect their hard earned retirement savings. The pensions are gone, and today 75% of Americans are using a tax-deferred strategy, like a 401K or IRA and as we discussed the risk is there. We cannot expect social security to support us in retirement and if we are saving a retirement nest egg, it is wise to choose a protected investment vehicle that offers a guaranteed income for your life and your spouse’s life. One that protects your principal balance without chance of losing money when the market or index under performs.
Rule #2 – The Only Way To Protect Yourself From Losses Is with a Guarantee
The fixed indexed annuity is your way to guarantee your retirement saving from loss. The thing most people overlook is that anything can be protected. In your life you buy life insurance to protect those you love in the event that your were to die suddenly. In your daily driving activities you are required to have automobile insurance to protect yourself from bodily injury, property damage or an accident. Your home or apartment can also be insured using a home owners or rental insurance. Why not protect a portion of your retirement savings that is guaranteed against loss, can participate in the growth of the index and guarantee your retirement disbursements for your life and the life of your spouse, with any remaining balance left after you both pass-on to be paid to your beneficiary as per the guarantee made by the fixed indexed annuity.
As you get older more of your retirement savings should remain protected. A good rule of thumb is that for people 55 to 60, 60% of their retirement savings invested securely. If you are in your 70’s then 75% of your retirement income should be protected. This is the only way to guarantee that you will never run out of money before you die.
Rule #3 – Your Spouse Needs The Same Income Even After You Pass
With a traditional pension after the person receiving the pension were to die, the spouse would often receive 50% less than the regular pension payment amount. In addition your death means the household income you and your spouse may be accustomed to receiving during retirement will be reduced to the higher of the two incomes given at the time of death by social security.
What protection to you have to guarantee that your death will not cause a reduced income? Using a fixed indexed annuity a portion of your retirement savings can be protected and guaranteed to remain the same payment amount for your life and the life of your spouse.
Rule #4 – Even In Retirement You Deserve A Return on Your Investment
This is one of the most exciting parts of a fixed indexed annuity. The annuity allows your money to participate in a portion of the gains in the index when it performs well. The last thing that you want is to hoard your money and not allow it to work for you losing money based on inflation rates that erode the value of your hard earned retirement savings. And, you certainly do not want to take the risk of leaving 100% of your money invested in the stock market where there is NO principal protection.
Rule #5 – Pass On Your Legacy To Beneficiaries After Death
An annuity contract has a beneficiary as does a life insurance contract. In most cases using a traditional will or trust, after death, the estate needs to go through the probate process as per state residence law.
However, when using an annuity the insurance policy has a designated beneficiary and the probate process is avoided as the insurance policy states where the remaining balance should be deposited or transferred occurring quickly.
Rule #6 – Protect 50% Or More of Your Investment Portfolio or Retirement Funds
Often the term “risk tolerance” comes into play when you discuss protecting your retirement assets. If interest rates go up the value of a bond goes down. A investment bond or CD may be the go-to non risky solution people most often discuss, however in those products your rates are earning you very little return on your money. The alternatives to investing for low rate of returns is an index annuity.
An index annuity offers:
- Protection
- Higher Growth Potential
- Significant Rates Of Return in an Uncapped Strategy
- Guaranteed Income for Life
- Principal Balance Earns Compound Interest Tax-Deferred
Rule #7 – Build A Modern Day Pension That’s Guaranteed for Life
It’s what everybody wants, right? I believe that having piece of mind that is your guaranteed income for the rest of your life and your spouse’s life is very important, not only to me but to you as well. Especially when we know over 90% of retirees biggest fear is not death, it is in fact to run out of money during their retirement!
