If the market’s ups and downs are making you nervous, you must ask yourself -how much risk am I willing to take with my retirement dollars? When you are thinking about retirement – the last thing you want to worry about is having enough money, but that is the situation many people find themselves in. Everyone knows someone who tried to retire in 2008 and had to delay or was retired and had to re-evaluate everything because of the enormous hit they took.
Learn from their mistakes, and don’t repeat them!
We always remind people that money in the market is an investment, not savings. You must realize market investments are always at significant risk and are anything but safe! There are places where your money can grow risk-free, and today, we will focus on one, Fixed Indexed Annuities (FIA.) An FIA is a retirement planning tool that guarantees income you can’t outlive. It is not where you want to put all your money – but if you want to keep a portion of the money you can’t afford to lose safe, you need to give Fixed Indexed Annuities serious consideration before it is too late!
Most people we work with have a pool of money they do not plan on touching until retirement. They have set it aside expressly for this purpose in a qualified plan such as a 401k, 403B, TSP, or an IRA. This is money they cannot afford to lose, yet they haven’t stopped to consider the enormous risk of having it invested (not saved) in the market. IS THIS YOU? Too many times, we have conversations with clients that thought they were in good shape, riding high on their investments, but when they were ready to retire – there was a significant drop in the market, and a chunk of their hard-earned savings was gone, just like their dreams of a safe and happy retirement.
There is a lot of misinformation by so-called financial experts surrounding FIAs. Do your homework and talk to people who have your best interest in mind! FIAs are a better option than the market when looking for a place to safely store and grow your money with no risk and a guaranteed income that you can’t outlive! A Fixed Indexed Annuity may be less exciting than the market – but you will not lose one cent of your principal, AND when the market is doing well, you will participate in the upsides.
Just like any product – there are good and bad annuities. When someone says they don’t like annuities, they don’t know the difference between the plans being offered. This is why you must work with an experienced professional who knows the marketplace and can ensure that the recommended products meet your goals. Annuities are insurance products that are contractually guaranteed. Having annuities in your financial portfolio is an intelligent strategy, especially if you are close to or in retirement. Is it ever a mistake to keep your money safe?
This is what we know about the market’s future – it will go up, down, or stay the same. Wouldn’t it make sense to eliminate the downside risk and ensure you have genuine retirement savings, not investments you could lose? If you can take away the very real threat of losing money and your only market exposure is making money or not losing money – wouldn’t you feel more confident and less stressed about your retirement?
Do not be caught off-guard! This year, we have seen strange volatility levels in the market, which only adds to fear and uncertainty. FIAs offer safety and stability. Compared to a down market, especially an ongoing one, you can see why an FIA shines even in a zero percent return scenario. An FIA should be considered an essential and strategic component of your overall retirement planning.
Not sure what to do next or if the timing is right? Give us a call, and let’s talk. We can review your current situation and explore and suggest safe options.
