If I had a million dollars, I’d be rich… but, would I be rich enough to retire for 30 plus years and never work another day in my life and not have to worry about running out of money?
The four percent withdrawal rule was an acceptable baseline for financial planners, and it was used for many years until we abruptly experienced…[continued below video]
**Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer and may contain limitations, including surrender charges, which may affect policy values. During this segment, Dick and Eric are referring to Fixed Annuities unless otherwise specified.
[continued]…a “lost decade” of growth in the stock market – that has now also been coupled with more than a decade of bank interest rates from about zero to 2-percent.
Much has been written about safe withdrawal rates in retirement and how our recent prolonged low-interest rate period could impact retirees ability to safely pull money out of accounts at what many financial planners had mostly considered safe levels. Nobody likes to visualize the prospect of outliving their money, but is living a retirement based upon disciplined austerity the best answer? That is why many have turned to annuities with a portion of their retirement savings, so they have at least a foundational **guarantee of income above the three to four percent rule for a lifetime of that is more generous.
No two planning cases are the same; and for some clients having one million dollars available — combined with their pension, and social security income with low living expenses – will mean not having to worry about running out of money during their lifetime. For another client with the same assets and income but higher living expenses, it may mean a lifestyle change or working longer. There are literally dozens of factors that can impact retirement and preparing for all the contingencies is impossible. However, it is possible to prepare for the most probable scenarios and utilize conservative assumptions to formulate the best possible plan for a safe retirement.
For those of you who may not be familiar with the song – “If I had a million dollars” by the Barenaked Ladies (yes, that is really the band’s name) you can check it out on YouTube via this link. Below is a Yahoo Finance article you may also find helpful…
You have to get rich these days just to finance a comfortable retirement.
That’s the conclusion financial advisors are increasingly coming around to, as they gauge the direction of the economy in a strange new world of glacial growth and super-low interest rates. “Twenty years ago, someone with a million bucks would have said, ‘that’s great, I can draw down $100,000 a year, I’ll be just fine,’” Jim McCaughan, CEO of Principal Global Investors, tells me in the video above. “But now, with very low rates, the problem of funding a retirement is much more difficult.”
Retirees don’t need to be told that low rates have cut sharply into the returns on fixed-income investments. But they may need to rethink how to prepare for what might happen in the future. Many investors are waiting for interest rates to go back up, once the Federal Reserve starts hiking short-term rates later this year or early next year. Meanwhile, the Fed is gradually winding down its vast “quantitative easing” program, which deliberately forced down long-term rates. So as that pressure eases, rates ought to go back up. Right?
Maybe not. McCaughan argues that we’ll be in a low-rate environment for much longer than many people expect, for a couple of basic reasons. First, an aging population means the demand for low-risk bonds will rise, pushing up prices but pulling down yields. Second, there’s been a growing gap between global demand and global production capacity, which will keep a lid on prices of most things for the foreseeable future. Low inflation usually coincides with low-interest rates.
There’s nothing magical (or scientific) about $1 million as a goal for retirement savings. As a round benchmark, however, it’s been in the ballpark for a couple hoping to retire comfortably. A $1 million principal will generate $60,000 per year in income if the portfolio’s return is 6%, and $40,000 per year at 4%. The amount you need to live on, of course, depends on many factors, including the cost of living where you reside, healthcare expenses, how much you travel and how long you live.
But if rates remain in the low range they’re in now—with 10-year Treasury rates well below 3%, say—it will change the math of retirement planning. During most of the baby boomers’ working lives, it was reasonable to expect annual returns of 6% to 10% on a retirement portfolio, without taking much risk. Add Social Security and other pension payments, and a $1 million nest egg was more than adequate for most people. [Read More…]
Using OutCome Based Planning™ for Your Retirement
We practice and recommend a "Holistic - OutCome Based Planning™ process when considering annuities." This approach has the effect of balancing your overall portfolio so you can meet your retirement objectives by "first identifying the least amount of your investments or savings (if any) that should be considered for annuities." OutCome Based Planning™ analyzes and models multiple outcomes so you can clearly identify your best income and growth opportunities.
"The Annuity Guys will only call if you request help". Hence, when you are ready for specialized help we will be available."Working with an Experienced Fiduciary Financial Planner can help you Avoid a Trial & Error or Risk Based Retirement"
This type of approach does take considerably more time, effort and analysis which will show you mathematically the successful possibilities by comparing various outcomes rather than trying to sell or convince you of that "so-called one best solution." Clients frequently tell us that this process removes some of the confusion and emotion to help them objectively identify a better retirement plan; rather than just ending up with the most convincing salesperson or advisor.
When requesting help you can be assured of working with an experienced Annuity Guys' Retirement Planner who is independently insurance licensed and securities licensed as a fiduciary financial planner having access to the vast majority of annuity companies in helping you choose the best annuities using a holistic-outcome based planning approach. We consider the high quality advisor recommendations we make to our website visitors as a direct reflection back on our commitment to serve all client's with a high standard of excellence in financial planning for retirement.
Based on survey feedback on advisors from our website visitors, we eliminated about two-hundred local advisors and now only recommend a few that we consider experienced vetted Annuity Guys' Fiduciary Advisors. Many local advisors continue requesting us to recommend them as a vetted advisor. However, our reputation and future business is driven only by satisfied website visitors. So, unfortunately we've had to tell the vast majority of local advisors no, since we changed our business model four years ago. At that time we stopped trying to satisfy everyone with local advisors, we now primarily work with individuals who are comfortable using today's internet technology to their fullest advantage by working with a select group of vetted, experienced and knowledgeable Annuity Guys' Fiduciary Planners.
Selecting the Best Annuity & Retirement Income Advisor
Are you willing to work with one of our retirement and annuity advisors based on their experience and expertise as a first priority rather than being limited by a local or regional area? The good news is that technology has forever eliminated our geographical limitations and leveled the playing field for everyone! As a result of today's technological advances, all of us can now work confidently with experts in any field including personal finance. We are no longer confined by regional or local boundaries limiting our choices and ultimate success. A high quality advisor is now as close as a click or phone call away.
"There is no room for trial and error when it comes to choosing MarketFree® Annuities or a Successful Retirement Planner."
"There are no undo buttons in retirement so it is vitally important that you do it right the first time!"
We are fortunate to have a select few who we believe are truly the highest qualified advisors out of about two hundred licensed insurance agents that we eliminated. Your survey feedback is what helps us make these tough decisions. Our advisors have an independent financial practice, specializing in annuities and retirement planning, which helps ensure that you are given the best options available for your retirement planning.
"It takes an experienced expert to know how to structure annuities for income, inflation, growth, return of principal, and tax advantage."
"Anyone can sell you an annuity; however, it takes a truly qualified and experienced advisor to know how to structure them for income, inflation, growth, return of principal, and tax advantage. Typically, there is not just one that can accomplish all of these objectives. It is how an advisor structures multiple annuities in balancing your total portfolio that makes it possible to achieve your most important retirement objectives."
Why Searching for the Best Annuities on Your Own Can be so Frustrating...Almost everyone nowadays turns to the internet for answers on everything - from buying new widgets to researching just about everything under the sun; and finding the best annuity is no exception!At first, it may seem that researching will be straightforward but the more time you spend researching them, the more frustrating it can be. Why is this? First of all, it does not take long to realize that gimmicks abound - such as warnings and alerts from salesmen who just want your attention so they can sell you one or the "too good to be true" claims of 8% to 14% **guaranteed interest and of course the claim that you can get the full market upside with no downside risk! If you have done any research you have heard all of these claims in advertising which are mostly half truths and not fully explained.So how can you find the best annuities on the internet? The truth is... you can't! And what is even more frustrating is all the conflicting points of view from so called experts. There are well over 6,000 different annuities - all designed for different reasons, so is it any wonder that the deck is stacked against the average researcher or do-it-yourselfer. Add to that the fact that they pay high enough commissions to attract a plethora of both good and bad agents. This does not make annuities good or bad; they are simply a financial tool that truly benefit those who use them correctly.How can you find the best annuities for your unique situation?
- Use the internet cautiously;
- Work with a vetted and experienced specialist;
- Do not settle for that one dubious best plan. Compare multiple Outcome Based Plans to decide on the one that is truly best for you;
- Be keenly aware of scare tactics and hyperbole - avoid those advisors and websites;
- Avoid websites that are focused on rushing free reports, rates and quotes to get your contact information they are rushing you to speak with them, instead, take your time and choose someone you are more comfortable with that works on your time-table;
- Know the Five Vital Factors (listed above) that an experienced specialist must answer before helping you select the best options for your situation;
- Watch this telling video "Avoid Annuity Gimmicks, Amateurs and Charlatans"...
** Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values. Annuities are not FDIC insured and it is possible to lose money.
They are insurance products that require a premium to be paid for purchase.
Annuities do not accept or receive deposits and are not to be confused with bank issued financial instruments.
During all video segments, Dick and Eric are referring to Fixed Annuities unless otherwise specified.
*Retirement Planning and annuity purchase assistance may be provided by Eric Judy or by referral to a recommended, experienced, Fiduciary Investment Advisor in helping our website visitors. Dick Van Dyke semi-retired from his Investment Advisory Practice in 2012 and now focuses on this website. He still maintains his insurance license in good standing and assists his current clients.
Our vetted and recommended Fiduciary Financial Planners are required to be properly licensed in assisting clients with their annuity and retirement planning needs. (Due diligence as a client is still always necessary when working with any advisor to check their current standing.)
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- MarketFree™ Annuity Definition: Any fixed annuity or portfolio of fixed annuities that protects principal / premium and growth by remaining market risk free.
- Market Free™ (annuities, retirements and portfolios) refer to the use of fixed insurance products with minimum guarantees that have no market risk to principal and are not investments in securities.
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