An Answer To Retirement Concerns

Let’s talk about a perfect retirement,
Receiving a fixed check without having to work sounds like a basic element of the perfect retirement, doesn’t it? I know what you’re thinking: “yeah, that sounds great, but pensions don’t really exist anymore!”

Unfortunately, you are correct; they don’t. Retirees, are expected to “do it themselves,” as many say.

In other words, the ideal retirement your parents and grandparents may have had the luxury of living is far more difficult for you to obtain today. Plain and simple. But, wait… is it really?

Let’s back up for a second: you are “expected” to do it yourself, yes, and, no, pensions aren’t as prevalent in the world of retirement today as they once were, but Annuities are, and what do Annuities do? Simply put …

Annuities Provide A Way For You To
“Build Your Own Pension”

This sounds even better than the traditional pension, and I am going to tell you why. Prepare to be amazed.

Pre-retirees who are soon to become retirees are going to need income, and over 70 million people will become retirement age over the next ten years. Those who do retire will likely

be pulling their money out of the stock market, and that’s a lot of withdrawals coming out of the market.

20+ years ago, companies provided pensions for their employees when they retired. These former employees would receive a lifetime income from that. Unfortunately, these companies stopped providing pensions because of it’s high cost and  financial liability for the company. This gave birth to the 401(k).

To deal with this, employees started building their 401k’s and IRA’s, and they started putting their money into the market. Because so much money was being put into the market, and pensions were being taken away, in the 80’s and 90’s people were making money at a staggering rate, and the market went up over 1,000% over a 20-year period (18% per year). The market had historically averaged 9-10% per year, and everybody thought the market was always going to go up 18% a year. This turned out to be a false expectation.

As you have witnessed in recent years, a lot more bad has been occurring in the market than good, because the market has been pretty much negative for the last 10-11 years. The people who thought the market was going to turn around and continue rising have been stuck, have left their money in the market,

and have been taking money out of their 401k’s and IRA’s. Their principal is shrinking. Every time the market goes down and they pull money out of their investments, their principle is diminishing even faster.

Since there are 10,000 baby boomers reaching retirement age every day, huge amounts of money will be coming out of the market since they will be needing that money to fund their retirement.

People need income. More importantly, people want to have the same purchasing power 20 years from now that they have today in to ensure that they can continue to afford things like medical and travel costs, gasoline, and food, to name a few. So, the subject of inflation is a big thing in their minds.

With all of the above considered, many people turn to CDs, as that is one of the traditional options. However, many people are now calling them “Certificates of Disappointment” because they’re just not yielding enough return these days. Other things people turn to are stocks and bonds. They think stocks are a good inflation hedge.

Everyone wants to live a confident and comfortable lifestyle in retirement. The same as while they were working and had an income.

Let’s take an example of somebody who needs $40k a year in retirement. What happens if:

• The CD doesn’t earn enough, its’ interest rate stays low, and you continue to pull out $40k a year to live on and you completely deplete this asset?

• What happens if bonds go down because interest rates go up? Right now, interest rates are at an all-time low. OR,

• What happens if the stock market (401(k), mutual funds, stocks etc.) doesn’t perform, and you’re pulling money out of the market depleting your principle (whether it is going up or down)?

I can answer these three questions in two words: lifestyle changes.

This brings us back to the beginning of the article, THE OTHER OPTION:

Buy yourself a “Personal Pension!”

By doing this, you are ensuring* yourself income for life. This is how you guarantee* yourself that confident and comfortable lifestyle in retirement that you seek, a retirement where you’ll NEVER outlive your money.*
There is always a need for income and there is always a need for protection of assets.

Protection + Income = ”Personal Pension”.

You’re probably thinking, “But wait… sure, I would get income for life with a pension, but I would lose control of my money.” You are correct if you were purchasing a traditional pension. But you aren’t purchasing a traditional pension; you are purchasing a Personal Pension. What does this mean?
Beginning in 2007, financial firms began selling Fixed Indexed Annuities (FIA).How does this work?

The interest earned from these FIAs is determined by watching a market index such as the S&P 500, Nasdac, etc. and calculating the interest rate based on the performance of the index(s) chosen. You only watch the index and calculate the return from the performance. You DO NOT INVEST IN THE INDEX OR MARKET ITSELF. You would receive part of the gains of the market, and none of the loss should the market go down. Your principal is totally protected from loss so that you never lose principal.

In other words, the worst case scenario if you purchase a fixed indexed annuity is, your principal will gain if the market gains, but you will never lose; if the markets crash, the asset will never lose principal no matter what happens.

You can’t be guaranteed that the asset is going to grow, but you can be guaranteed* that you won’t lose your principal.

In addition, when you are ready to turn on that income, you will receive a guaranteed, predictable, income for life*. Therefore, the possibility of outliving your money is eliminated with this product. Even if you deplete your account down to zero, the financial institution has to continue to pay you income for life*.
If you want to pull your money out at some point, you are able to do so. You do not lose control of your money.

And THAT, is a hedge against inflation!

Don’t wait to build your own “pension.” Get started now!

*Annuity product guarantees rely on the financial strength and claims-paying ability of the issuing insurer.

**Depending on contract terms, the amount of principal withdrawn may affect the amount of the monthly income stream from the annuity.

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