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A New Year Resolve for Financial Security

Todd D. Heckman

The figgy pudding has been given, the presents unwrapped and Christmas goose consumed (In my household it was ‘Leg of Lamb’ on the Grill… benefits of living in Florida!).  You watched “It’s a Wonderful Life” and “A Christmas Vacation” so many times that you yell at George Bailey to get off the bridge and go home and for Clark to plug in the lights already! Now that Christmas Day has come and gone, it’s time to look toward 2014 and the various resolutions we will make and break in the coming New Year.

Before you begin the process of making your New Year’s resolutions, it’s time to commit to a New Year resolve to learn about ways to secure your financial future as you age and require care and assistance. This includes: Understanding the types of products that can be used to fund your future, having an all-important conversation with your family and loved ones about your wishes and desires and making plans to meet with an advisor and create a plan of action.

Learn About Ways to Secure Your Financial Future

The first step in the process is learning about the different types of financial instruments available to you that can help secure your financial future, be it the need for retirement income or to pay for long-term care and assistance. The products that provide you with a great level of funding flexibility and options for your future needs include:

  • Fixed Annuities 
  • Longevity Annuities 
  • Cash-Value Life Insurance (such as Universal Life and Whole Life Insurance) 

Fixed annuities are a type of financial product that features a tax-deferred period of accumulation and a guaranteed stream of income at the point of payout or annuitization (typically at or after age 65).  During the accumulation phase, assets placed into the fixed annuity grow at a stated rate of interest that is guaranteed by the issuer (typically an insurance company) and provides you with a great level of safety and security.  Then at retirement time, you can turn on the income stream to receive regular monthly checks for the rest of your life. Now that’s a “Wonderful Life”!

For individuals who do not have time on their side before a need arises (i.e. less than 5 to 10 years), a variation of the traditional fixed annuity known as a longevity annuity may be worth consideration. This product offers the ability for an older individual to benefit from deferral of an asset or a deferred income option that provides a stream of cash for a fixed period of time (or lifetime) immediately with the rest going into your estate when death occurs. Finally, life insurance that has a cash component inside the policy is always an available option for funding a future need like retirement. The cash build-up inside the policy can be accessed tax-free and may or may not affect the policy’s death benefit depending on certain factors.

Discuss Future Plans with Your Family

There is no better time to have a discussion with members of your immediate family about your plans for the future than before the start of the New Year. Having family members around afford you the opportunity to discuss a wide range of topics, including the type of legacy you want to leave, what you want your money to represent (in terms of inheritance and charitable gifts) and how you want to live as you become increasingly dependent on others for support.

It is not an easy conversation to have but it is a necessary one. Knowing where the insurance policy is kept, what assets are where and your wishes for care (i.e. in the home or community versus a facility, in the case of long-term care) is important for adult children looking to settle your estate or provide you with the best care options. A family that plans together stays together.

Make a Plan of Action

So few people ever create AND communicate their retirement and Long Term Care caring plan. A plan of action should be created to capitalize on the conversation you had with member of your family and your understanding of some of the products that can help you plan for the future. A qualified financial professional, especially one who understands the issues surrounding retirement and elder care, can guide you through a process that identifies the things that are important to you, locate assets necessary to meet your needs and put you on a road to eliminate any worry or concern when the future arrives. 

Happy New Year and here’s to a successful 2014!

To learn more from this annuity professional, simply click here (Todd Heckman).

About the Author:

Todd D. Heckman CLU, ChFC, CFP®, AEP®, MSFS is the President of Life resource Planners of the Treasure Coast (a division of  the Estate Planning Advisors) , a firm specializing in Retiree Healthcare and Retirement Income issues is located in Vero Beach, Florida. He can be reached @ 772-567-7970 x102 or a


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