Think Outside The Box

Retirement is serious business that needs some serious thought

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Would you consider an annuity as an alternative investment option for retirement? Some investors shy away from annuities because they consider them to be less than ideal as a retirement investment. Financial planners suggest that gap is due to misinformation.

If you feel misinformed, learn more about annuities before making any financial decisions. You should always weigh the cost of an investment against the returns but also the other benefits of that investment.

An annuity is packaged with guarantees, protection and peace of mind. Other investments do not necessarily offer all of those benefits. Yes you do pay extra for those benefits in an annuity. However the extra fees you pay may be worth it since other investments are struggling to achieve ideal returns right now.

You worked hard at accumulating money for retirement; you need to work smart to preserve it.

What Will You Get From An Annuity?

  • Guaranteed Income For Life

When you reach retirement you want peace of mind and that usually translates to no money worries.

If you are afraid to retire because you’re not sure your investments will last as long as you do, you may consider investing a portion of your retirement money into an annuity. An annuity will provide you a guaranteed stream of income for the rest of your life. If you add on a living benefit rider the income will continue regardless of how the market performs.

  • Guaranteed Protection

If your only life insurance policy is from work, most likely that policy stops when you leave employment or shortly thereafter unless you continue the payments. Within an annuity is a built-in guaranteed death benefit therefore you can drop your work life policy as soon as you retire.

  • Beat Inflation

Inflation can be nasty, and you have no control over it.  If you add on an inflation index rider your retirement income stream is guaranteed to keep up with inflation.

Annuities Compared To Other Investments

Annuities are not risk free but neither are other investments. Bank cd’s are paying out a very, very low-interest so you run the risk of not earning more than inflation.

If your retirement planning included using the sale of your home as a source of retirement income you run the risk of the real estate market not rebounding in time. Real estate right now could take years to recover.

Mutual funds and stocks do not offer any guarantees because your returns fluctuate with market volatility.

Retirement Is Serious Business

When you are retired you need stability not volatility. There are no d0-overs with retirement. Avoid putting your retirement assets at risk by choosing the proper investments. You may want to take a closer look at annuities since they could offer more stability than other investments right now.