Yup, it's a perfect storm for a Fixed Indexed Annuity. Better yet, if you have an IRA in a tax qualified account, talk to your financial advisor about this option to preserve your lifetime of retirement savings.
Why? Well many economists think the economy has and will continue to be hot for the next year. The Feds have and will continue to raise interest rates. When Interests rates rise, the markets tend to look for safety in bonds, fixed equities, etc... So, why is this problematic to your retirement and financial security. Simply stated, if markets are correcting the value of your 401k, IRA, or some market exposed account will more than likely decrease. The other concern is that the NEGATIVE SEQUENCE OF RETURN will impact your cash flow for sure. Taking retirement monies in a decreasing market puts the value of your remaining monies at risk. Why do this in your retirement or pre-retirement years? The concerns of not having needed money in your "Golden Retirement Years" could be devastating.
Dave, What Products Could be Effective?
At DAK Financial Group, we think that Safety, Growth and Control are the cornerstone to ensuring your retirement years go smoothly. Let's face it: you’re trying to get rid of the stress that has surrounded your world as you worked and now the last thing you need to be worried about is losing the value of your money in a down economy.
So, with that in mind there are several considerations that we think could make some sense. Many advisors could make a reasonable recommendation of bond ladders. Bond ladders are effective, using stages of maturities, but returns are going to be about 5%, less than the advisors fee.
Another one of our more popular options is the Fixed Index Annuity for your IRA or 401k rollovers. Here's how it works… in my view, a Fixed Index Annuity without fees, charges or expenses can give you the purchaser the ability to get market related growth without the risk. (An Insurance company that is highly rated and guarantees your principle).
The company allows the purchaser to participate in an external index like the NASDAQ, S&P 500 and the participant makes gains if there are gains to be made. If there are market declines, the participant/owner does not lose a dime, because there is a floor. There are plenty of Fixed Index Annuities to be bought but you should talk with an independent producer like DAK. DAK, being independent, means we can offer you the most competitive products in the marketplace. We are geared towards working with people and helping them navigate their specific financial needs. Using the client's definition of help, we find that we are able to target the individual needs much better.
Just remember, locked in gains are kept and are yours like interest at the bank. This is extremely important during the retirement years. When there is NOT a NEGATIVE SEQUENCE OF RETURN your money does NOT get lost and you can count on that for income. Naturally, if you have any questions about this remarkable program, please call us for written reading materials. Don't forget to stop by for that cup of coffee. You'll be glad you did.
Get to know us on Facebook.
Listen to the podcast.