“You can’t always get what you want; but if you try, sometimes, well you just might find you get what you need.”
You probably never imagined the Annuity Guys would be quoting lyrics from the Rolling Stones, but somehow this line was the perfect description of the findings from a TIAA-CREF study on lifetime income. The TIAA-CREF study found that eighty-four percent of respondents claim that receiving a **guaranteed monthly paycheck during retirement is important to them; but only fourteen percent have purchased an annuity. We don’t know from the study whether or not they asked…[continued below video]
Video: The Annuity Guys, Eric and Dick review why many investors fail to buy an annuity – even though they want one.
**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]…respondents if they were receiving enough income from another **guaranteed source, such as Social Security or a lifetime income pension. However, just from our discussions with website visitors, we can validate the high level of folks looking to create a **guaranteed lifetime income stream.
Many times people decide not to buy an annuity due to either a misunderstanding of the annuity or a miss-characterization assuming that all types of annuities are similar. We know that the internet is a wealth of knowledge about annuities and how they work, but we also see a significant emphasis on the most highly criticized aspects of one type of annuity misapplied to all types of annuities. Unfortunately, the emphasis on the negative aspects tends to stick in peoples minds causing some to avoid a discussion about the pros and cons of any particular type of annuity.
It is noteworthy that one group of Americans buying annuities are the very wealthy. The top 1 percent of wealthiest Americans, those annually earning over $380,000 are more likely to own annuities. Why would wealthy individuals who would seemingly not need an annuity that provides a **guaranteed income flock to them? It seems they value annuities for what they provide – safe income, safe growth, tax deferral, creditor protection, and the ability to avoid probate as an asset class that is non-correlated to the stock market.
So, it seems that if you know what you need you might just get what you want!
By Casey Dowd
Earlier this month TIAA-CREF released their second annual “Lifetime Income” study which revealed that many Americans are generally interested in a **guaranteed monthly income stream but are unfamiliar with annuities which could support their lifetime income options. “For many Americans, annuities are often unknown or misunderstood, which is unfortunate since they are the only way to generate retirement income that cannot be outlived,” said Ed Van Dolsen, president, Retirement and Individual Financial Services at TIAA-CREF. 84 percent of the respondents claim that receiving a monthly paycheck during retirement is important to them; yet only 14 percent of Americans have purchased an annuity.
Sean Wilson, a Wealth Management Adviser at TIAA-CREF discussed annuities with me and how they can help retirees to achieve their lifetime income goals. Here is what Sean had to offer:
Boomer: What are the different types of annuities?
Wilson: When you invest in an annuity you can choose to allocate your money in:
Guaranteed investments. Your investment dollars will accumulate at a **guaranteed interest rate. If you’re not comfortable with market volatility and its potential to impact your savings or income, this could be the choice for you.
Variable investments. Your investment will accumulate based on the performance of the variable funds you select. If you would like the potential for higher returns on your investment and are comfortable with risk, you may consider this choice. Of course, there are risks associated with investing in variable products, including loss of principal.
In fixed or **guaranteed annuities, the funds are invested in the insurance company’s general account, which typically contains fixed-income securities, such as bonds. The issuer, not the contract owner, assumes all investment risk. Fixed annuities offer a **guaranteed payment, with the payout amount based on the assumed future returns of the investments and the annuitant’s life expectancy. The payment can be fixed for life or can allow for future increases.
Variable annuities provide the contract owner with the ability to invest in both fixed-income and stock-based accounts whose values change depending on the performance of these underlying investments. While variable annuities# offer the potential for higher long-term returns than fixed annuities, generally their payouts will fluctuate (sometimes dramatically) from year to year. Unlike with a fixed annuity, the contract owner of a variable annuity# assumes all investment risk.
When planning your financial future, one of your biggest concerns is “longevity risk,” or the risk of being unable to fund your retirement if you live much longer than expected. Consider a product that offers one of the best ways to finance a long-life expectancy — the life annuity.
While variable annuities# are often criticized for having high fees (a criticism of some fixed annuities as well), being difficult to understand and lacking flexibility on receiving income in retirement, life annuities offer one advantage that other investment options do not — a **guaranteed stream of income that will last as long as you live. (Note that these **guarantees are based upon the issuing company’s claims-paying ability.)
A variable annuity# that provides a range of investment options among various asset classes, has relatively low costs and includes product features that are well-suited to your needs can play an important role in helping you fund your retirement.
Boomer: What investment and payout options do annuities have? [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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