The stock market, as measured by the Dow Jones Industrial Averages, is rising and falling by hundreds of points daily, setting growth records one month and reversing directions the next. The "new normal" gyrations make retirement planning next to impossible because the next prolonged downturn could be the very time you need your money. If your greatest fear is running out of money, and it is for most retirees, being in "the market" could be a self-fulfilling prophecy. Is there a better way?
The New Safety Standard
Let me introduce you to a safe money option that could be suitable for some of your retirement money: fixed index-linked annuities or just FIAs. FIAs are available from insurance companies that guarantee them with their financial strength. Insurance companies have never let us down in protecting our homes, cars, health, lives, businesses, and more, nor have they on FIAs. The aging of America, fueled by 78 million baby boomers, has given rise to a new type of risk that insurers are willing to assume: the risk of living too long, i.e., longevity risk. How do FIAs work?
With an FIA your money IS NOT invested in the stock market; thus, there is no market risk or uncertainty. The interest you'll earn is determined by a market index and if the index rises you'll get some of the gain but none of the loss if the market falls. The cost of "no downside" is not getting all the "upside". This gives you the potential to realize above market earnings. FIAs will not make you rich, nor will you lose money as you can by guessing wrong in the market. FIAs are best for your "later in retirement" money. If you're earning a pittance at your bank, or risking your retirement in the market, you should learn how FIAs can be a great place for some of your retirement money.
No Loss, Guaranteed
FIA earnings are not taxed until actually withdrawn, just like an IRA or 401(k). This permits you to pay income taxes when you want rather than the IRS deciding when you must. Also, you have limited or full access to your money via free withdrawals annually and generally the full amount if confined to a nursing home or diagnosed with a terminal illness. Your FIA passes directly to your named beneficiary without probate hassles if you don't use it for your retirement or to cover an emergency. But the best part is that you can convert your FIA into a lifetime of guaranteed income that you cannot outlive.
Many FIAs guarantee you 7% or more earnings annually IF you later select the guaranteed lifetime income option. This allows you to know today the exact minimum amount of guaranteed lifetime income you'll have when you start taking it – no guess work, no market ups and downs and no risk of loss. Is the FIA safe? No one has ever lost money in an FIA UNLESS they withdrew their money early. All your worldly valuables are protected by insurance companies and you've not lost sleep worrying; thus, why not plan to find out more about FIAs to determine if your retirement peace of mind will benefit? FIAs can change your "hope so money" into "know so money". Talk to me today to see if FIAs can add security to your retirement years.
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