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Annuity Basics

Annuities as Bond Alternatives

Morgan Hill

For decades, a commonly cited rule of thumb for retirement portfolios has been the “rule of 100.”  It states that individuals should hold a percentage of stocks equal to 100 minus their age. So, for a typical 60-year-old, 40% of the portfolio should be equities and 60% of the portfolio should be held in conservative or otherwise fixed-rate investments; bonds, treasuries, CDs, etc. However, with the large majority of these safe investments pay out roughly 2%-4%, many investors are keeping their exposure to equities disproportionately...

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Why Is An Index Reset Critical To Retirement?

Dave Mortach

People purchase annuities for a number of different reasons. Certainly, ensuring a lifetime stream of retirement income is one of the primary factors for purchasing this type of financial vehicle. But while the annuity is still in its funding—or accumulation—phase, it is also important to make sure that you are able to grow and protect the funds that are inside of the account. Using a fixed indexed annuity, or FIA, can be an ideal way to generate a retirement income. These annuities credit interest based...

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The Power of Locking in Your Gains

Dave Mortach

When obtaining any type of financial vehicle, there is typically some type of risk-return tradeoff. For instance, in today’s low interest rate environment, it’s tough to obtain the growth that you need, yet it’s important to also play it safe in order to protect your principal. The fixed indexed annuity, or FIA, can provide a great solution for offering the potential for market-related growth, yet protection from downside risk. This can in turn help you to generate more retirement income down the road. Ensuring that...

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Longevity and Your Money

Craig Moser

Looking back at my father, I see someone who was entitled to two pensions and Social Security. As he put it, he “just got money in the mail.” Fast forwarding to present day, I work with folks who are or will be solely dependent on the money they have saved and their Social Security to drive their retirement income. So the question is, “How do you not outlive your money?” We work on average 40 years. During that time we buy homes, perhaps raise and...

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Should You Hate Annuities?

Art McPherson

If you are reading this article, you can probably identify with the title in some form. However, annuities are one of the largest growing financial segments in the financial industry. There are currently 223,000 advisors in the financial services industry and only 1% of those advisors produce more than 1 million in production annually. Out of those select few advisors, only a handful of advisors have a radio show that offers financial information on a regular basis to educate their clients and their communities. If...

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The Right Tools for Retirement: A Quick Guide about Annuities

John Hill

The question is not if annuities are good or bad. The question is what type of annuity works for your retirement. All tools exist for a purpose. Don`t use a hammer when you need a screwdriver. In this article, I will discuss the purpose of annuities, specifically fixed and fixed indexes annuities. By the end of this discussion, I will outline some of the questions surrounding annuities and why annuities are the right tool for your retirement. Question 1- How much money should I risk?...

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Why The Popularity of Annuities Can Be a Bad Thing!

Jim Fox

If you’re like many Americans nearing retirement, you’ve been invited to more dinner and lunch seminars than you can count. What might surprise you is that only half a percent of people who receive those invitations actually attend the seminar. Even more shocking is that majority of seminars are geared toward one thing: presenting and soliciting annuities. When I began working as an advisor, almost two decades ago, I was trained that annuities were horrible retirement vehicles sold by seedy salesmen with little regard for...

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The New Age Annuities…

Charisse Smith

If you are embarking into the annuity world for the first time, it might be like being lost adrift in the movie “Water World.” You are wandering in a sea of never-ending questions. Folks who have been in annuities for years may still not understand them. There are fixed annuities, immediate annuities, variable annuities, and index annuities with caps, all of which are quite complex, especially if you have received your first annual statement and you only made 3%. Annuities have changed immensely from the...

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What Should I Believe About Annuities?

Jason Weckel

Of the entire spectrum of financial tools and products that have been available to investors over the last several decades, virtually none of them have been so polarizing as annuities. In theory, they are attractive options for retirees looking for a consistent income stream often times supplementing a pension or Social Security. Yet there is no shortage of articles both on the Internet and in print advising would-be annuity owners about the many pitfalls of these instruments. Some commentators offer cautious, thoughtful insight into the...

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Value and Variable Annuities

Chris Letendre

Everyone always asks me, “Chris, what do you think of variable annuities?” And every time they do, my first thought to myself is, “how much time do you have?” I have over 20 years of experience on this subject, and there are so many things I would like everyone to know and learn. But the reality is: For most people, what I know about variable annuities is too complex for the average investor to want to learn. I believe the insurance companies that offer variable...

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