When I’m asked if an annuity is a good buy, I reply: it all depends on your situation and your goals. Once you’ve settled on what you want to accomplish, you can decide whether an annuity makes sense for you, realizing that different types can help you meet different financial goals. Annuities can’t all be… Continue reading Annuities: The Swiss Army Knife of Personal Finance
Tag: annuities
A Financial Review in Early 2023 Can Optimize Your Strategy
My husband is delighted to know he is not my Sugar Daddy. In fact, my doctor has me sworn off sugar of all kinds. So, no Sugar Daddies need apply. I am officially pre-diabetic. In truth, I saw this coming. My twin brother is a diabetic and so is my sister. It is in the… Continue reading A Financial Review in Early 2023 Can Optimize Your Strategy
Have Lower-Yielding or Underperforming Annuities or CDs?
Today’s higher interest rates are great when you have new money to invest. But what can you do if your money is already tied up in lower-yielding deposit accounts—specifically, bank certificates of deposit and/or fixed-rate annuities that are still subject to early surrender penalties? It turns out you do have options, especially with annuities. While… Continue reading Have Lower-Yielding or Underperforming Annuities or CDs?
Three Ways to Get Future Lifetime Income with Annuities
Looking to maximize retirement income? Fixed-rate, income and indexed annuities offer different ways to get there, either standalone or in sequence. An annuity is the only financial product that can guarantee lifetime income. If you want to secure future income with an annuity, you have three main choices. Each can be appropriate for nonqualified (taxable)… Continue reading Three Ways to Get Future Lifetime Income with Annuities
Five Annuity Myths That Can Blind You to Good Options
Annuity myths are harmful because they lead people to dismiss annuities out of hand when they could be a perfect fit. Myth 1: annuities are all the same. They’re good only for retirees. Fact: different types of annuities are distinct and can help a range of people achieve their financial goals. Annuities fall into two… Continue reading Five Annuity Myths That Can Blind You to Good Options
Rising Rates Threaten Bond Funds. Consider These Alternatives.
Bond funds, including mutual funds and exchange-traded funds (ETFs), are popular because they have appealing features. But they do have some significant disadvantages. Bond funds are liquid and are less volatile than equity funds, and they typically pay monthly income. They come in many flavors, from the lowest-risk offerings like short-term US Treasury funds to… Continue reading Rising Rates Threaten Bond Funds. Consider These Alternatives.
Shelter from the Financial Storm
As you approach and then enter retirement, it’s wise to gradually shift much of your savings into vehicles that guarantee your principal while providing a good interest rate. The stock market’s extreme volatility in 2020 shows that relying too heavily on equities exposes mature investors to unneeded risk. They need ways that reduce risk while… Continue reading Shelter from the Financial Storm
Many Options to Reduce Investment Risk in IRAs
People approaching or in retirement should not have an over-weighted stake in equities. If you need to reduce risk in your IRA and/or Roth IRA, what are the best ways to do it? A bank certificate of deposit (CD) is a reasonable choice. But a fixed-rate annuity can be an even better choice. Both CDs… Continue reading Many Options to Reduce Investment Risk in IRAs
Believing Annuity Myths Can Hurt You
People miss out on proven solutions to retirement saving and planning because they swallow myths and misconceptions. I HATE Annuities! screams the headline. The ad goes on to list what Ken Fisher, a famous money-manager, claims are the sins of annuities. Those ads have an impact. Many of our callers say they’ve heard that annuities… Continue reading Believing Annuity Myths Can Hurt You
Annuities Beat CDs by Offering Higher Guaranteed Rates and Tax Savings
Older Americans love certificates of deposit. But fixed-rate annuities, which function like CDs, usually pay much higher guaranteed rate. And they offer tax deferral. CDs have one main advantage over annuities: they’re insured by the FDIC. But I think it’s a tiny advantage, all things considered. Fixed annuities are guaranteed by life insurance companies, which… Continue reading Annuities Beat CDs by Offering Higher Guaranteed Rates and Tax Savings
Updating Beneficiaries When Life Changes is Crucial
Once you’ve bought an annuity or a life insurance policy and named your beneficiaries, you may never think about your beneficiaries again. But that could be a big mistake. If you get divorced and remarry but fail to change your beneficiary from your ex-spouse to your current spouse, your ex will receive the proceeds. Besides… Continue reading Updating Beneficiaries When Life Changes is Crucial
Rising Annuity Rates Benefit Retirement Portfolios
Annuity rates have gone up a bit recently, according to AnnuityAdvantage’s database of 290 fixed annuities from 35 insurers. They currently pay up to 3.40 percent for a 10-year annuity, up to 3.15 percent for a five-year contract, and up to 2.10 percent for a three-year annuity. Financial planners recommend splitting your investments among equities… Continue reading Rising Annuity Rates Benefit Retirement Portfolios
Waiting for Higher Rates Is a Bad Bet
Many people who want to invest in fixed-income or principal-protected products like fixed annuities and CDs hesitate because they’re leery of tying up their money at current rates. But delaying costs you. While you’re waiting for rates to rise, you’re earning little in a money market fund or bank account. It’s very hard to catch… Continue reading Waiting for Higher Rates Is a Bad Bet
What If Your Retirement Money Hits Bottom?
Wall Street hasn’t been for the faint of heart lately. Jittery investors saw the volatile market play havoc with investment portfolios. But while the ups and downs may have created anguish for some, financial planner Bryan S. Slovon says he fielded few if any calls from nervous clients. And that’s the way it should be… Continue reading What If Your Retirement Money Hits Bottom?