Picture the golf ball rolling across the green and dropping into the center of the cup for a thrilling one-shot victory over your playing partners. While not exactly the same as sinking a putt to win the Masters, you still get a sense of accomplishment and a moment of joy. Smell the ocean air while you stare out at the distant horizon from the upper deck of the cruise ship. With good health and sufficient income, retirement can be the most rewarding time of your life.
Addressing your need for income
Every situation is different when trying to calculate just how much income you will need to live comfortably during retirement. You may not need as much income to cover the basics such as food, clothing and shelter, but you may need more money to pay for doctors and medical care. Whether you sit down with a financial advisor or do the calculations on your own, you should be able to come up with a good estimate of how much monthly income you will need. Social Security or a pension may pay for some of your regular monthly expenses, but it is usually not enough.
Your 401-K, IRA or other retirement savings may be substantial, but it is a risky strategy to simply draw down your balance as you need more money. What are your options for generating income?
- Certificates of Deposit
- A Fixed Index Annuity
Safety and rate of return
Once you have stopped working, you must depend on the money you have saved to generate the income you need for the rest of your life. You should consider this money to be your safe money, or money you cannot afford to put at risk. With CDs, you have safety, but at today’s prevailing interest rates, your returns will probably prove to be less than satisfactory.
You may have considered a portfolio of bonds with staggered maturity dates. Bonds fluctuate in price depending upon interest rates. If interest rates start going up, the value of your bonds will decline. You have no guarantee of what your return will be with bonds.
Stocks are risky. They can fluctuate wildly with the sentiment of the market. Even dividend-paying stocks carry substantial market and company-specific risk. While you can earn greater returns in the stock market than in more income-oriented investments, your risk of loss is much higher.
A fixed income annuity may be the best solution for your retirement income needs. This type of annuity product, which is sometimes referred to as a safe money longevity annuity, can provide a guaranteed minimum rate of return as well as a chance to earn a higher rate of return when the stock market performs well in any given year.
A blue ribbon winner
Who wants to settle for second place when the best lifetime income annuity is within your reach? At Advanced Capital Management Inc., we compare the many different annuities out there and analyze all of the features they provide. Our knowledgeable and experienced representatives will work with you to find the best lifetime income annuity to match your retirement and income goals. In the world of annuities, a hybrid annuity is arguably the blue ribbon winner among all types of annuities.
Why is a hybrid annuity so good?
A hybrid annuity combines the best features of both fixed and variable annuities to produce safe, above-average returns that can generate a guaranteed stream of income for the rest of your life. It borrows the ability to participate in stock market gains from variable annuities while never risking any of your principle investment when the stock market goes down. It acts as a fixed index annuity by being linked to the performance of an index such as the S&P 500. In return for eliminating your risk of losing money in a down market, you only participate in a percentage of the indexed gain in any given year.
You are contractually guaranteed a minimum annual return during the deferral period and a fixed monthly or periodic payment once you start taking a payout. By adding a guaranteed lifetime rider, you are assured of never outliving your money.
All hybrid or fixed index annuities are not the same. Some are better than others. At Advanced Capital Management, we examine the fine print in each annuity contract and present you with the facts. We compare annuities from reputable insurance companies and then explain all of the features so you can have confidence that the annuity you are considering will be best for you. It costs you nothing to find out if a Fixed Index Annuity or Life Insurance is the right option for you. Just click on the orange “Get Annuity Quote” button to the right to see how you can generate more income, safely, for your retirement years.