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Retirement Planning Blog

in Annuity
on 13 April, 2021

what are annuity rates

Are you looking at different annuity rates for your retirement goals? Generally speaking, an annuity rate is the percentage at which money inside an annuity grows annually. While a majority of annuity rates have to do with growth potential, not all rates do.

Many advertisers push different annuity rates online, but these rates can have different meanings. Those rate distinctions differ largely along the various types of annuities and what each type offers to you.

Some annuities, like immediate annuities, will give you rates that are tied to income payouts. Since immediate annuities are designed to pay you income right away, that makes it pretty straightforward. Other annuities are more 'income for later' and come with rates like “payout percentages” depending on the type of payout option you choose.

Annuity rates usually vary from one life insurance company to another. What’s more, rates are tied to current interest rates. So when current interest rates change, annuity rates tend to move with them.

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on 09 March, 2021

sequencing risk retirement planning

If you look at any financial commentary, there is at least an article a day talking about investment risk. Investment risk, or the risk of losses due to market downs, is always something that we should be conscious of. But, for retirement investors, there is an even bigger risk than investment risk: sequencing risk.

This type of risk can be more dangerous than pure market risk because of the effects that it can have on your long-term retirement outlook. This can have a nasty impact especially if your money takes a hit in your early retirement years.

Sequencing risk looks at the order in which your portfolio returns occur. If you take losses early in your retirement, then it will impact your finances for the rest of your life. And you might well spend the rest of your retirement playing "catch-up" from those losses, especially if you were already drawing income from your portfolio and compounding the effects of those losses even further.

Sequencing risk can have strong effects on people's financial wellness that can span years. So, it's critical to have a strategy in place for this possibility, especially if you are in the retirement red zone (within 10 years before or after retirement).

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in Annuity
on 08 April, 2021

alternatives to variable annuities

Do you have a variable annuity and are you looking for alternatives to it? Not sure about what options might make sense for your situation?

Many people buy annuities for different retirement goals, but variable annuities tend to be bought more than other types of annuities. However, this is likely to change in the near future. What is driving this shift is that people are on the lookout for alternatives to variable annuities.

Why? Variable annuities offer the most growth potential of all annuities. But they also have the most exposure to market risk.

What’s more, while this isn't universally true for all of them, many variable annuities are also fee-heavy and expense-heavy.

According to the SEC, just one annual charge for life insurers managing longevity risk – called a mortality and expense charge – can add up to 1.25% per year in variable annuity contracts. Other research by groups like Morningstar has also found that cumulative fees and expenses in a variable annuity can be in excess of 3 percent.

Depending on their needs, people may be interested in alternatives ranging from annuity contracts with less market risk to financial vehicles that aren’t even annuities at all.

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in Annuity
on 03 March, 2021

safe money and income strategies

Are you looking for safe money and income strategies that you heard of on the radio or someplace else? After a long career, most people would like a financially secure retirement that they can spend in peace and comfort.

This probably applies to you as much as anyone else. As you prepare for your post-career years, you may have heard or read about those "safe money and income strategies.” If you have, you may be wondering exactly what they are and whether they are right for you in your current financial situation.

What Are Safe Money and Income Strategies?

This sort of strategy follows a retirement school of thought that emphasizes income, safety, and protection. At its core, a safe money and income strategy can:

  • Pay regular predictable income to you for as long as you live.
  • Protect your hard-earned retirement assets.
  • Grow your money with a guaranteed interest rate.
  • Possibly earn more interest above a certain minimum rate.


Many fixed-income assets can serve as its lynchpin, from fixed-type annuities to bonds or Treasury securities. However, only annuities can truly pay you a guaranteed lifetime income.

What’s more, historically low interest rates have made it that much harder to live off of the interest from corporate and municipal bonds, CDs, Treasury securities, and savings bonds.

This isn’t to say that these instruments can give you some yield for dependable retirement income. It’s just harder in this lower interest rate environment.

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in Annuity
on 31 March, 2021

independent annuity advice

Where do you find independent annuity advice that you can trust? Just mention the topic of annuities, and you certainly won’t have any shortage of opinions coming out of the woodshed.

Many financial advisors and pundits are in the pro-annuity camp due to the strong contractual guarantees that only annuities give. On the other hand, annuity naysayers point to a few things, such as sometimes overly aggressive sales pitches, to make their case of annuity pessimism.

So, how can you find independent annuity advice that is somewhere in the middle: objective, honest, and focused on helping you become educated and make a well-informed decision? A good source will give you, among other things:


In other words, a credible source of annuity information will be upfront and clear about what annuity contracts can achieve – and also not accomplish – for you.

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in Annuity
on 24 February, 2021

difference between immediate and deferred annuity

Annuities are a growing option for retirees looking for relatively 'worry-free' places where they can place their money without too much stress. There are many different types of annuities. But all annuities can fundamentally be divided into two main categories: immediate and deferred annuities.

By definition, an annuity is when someone puts a single lump-sum payment or a series of payments into a contract offered by a life insurance carrier. At a later point, this person starts receiving a stream of income from the annuity contract. The income stream can be for either a set period or the rest of their life.

So, what are the key differences between a deferred and immediate annuity? Here's a quick look at the overarching distinctions.

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on 24 March, 2021

wealth transfer strategies

At some point or another, you may have heard of the “Great Wealth Transfer.” The baby boomer generation will be leaving trillions of dollars to their heirs over the next 30 years.

IRAs, qualified employer retirement plans, taxable investment accounts, annuities, and life insurance will be among the numerous assets that provide a legacy for generations to come.

Depending on the situation, some methods of wealth transfer may be more advantageous than others. People who work with advisors specializing in legacy planning strategies can save a great deal of time, confusion, and money in figuring out what makes sense for their goals.

Strategic guidance from their financial professional, in conjunction with high-quality estate planning legal counsel, can help ensure the smooth transition of their wealth to their heirs. 

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in Annuity
on 18 February, 2021

should you buy an annuity at age 50

Chances are you have heard of annuities at some point. When they have a clear role in your plan, they can be an excellent part of a retirement strategy. If you are in your 50s, you might have thought at some point or another: Does an annuity make sense in your 50s, even when retirement might seem still quite a few years away?

Well, the answer rests on three primary factors: when you plan to retire, what your timeline is from now until then, and what you would use the annuity for.

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on 18 March, 2021

how to handle market risk near retirement

Balancing risk in your portfolio is a fundamental at all ages, but it’s particularly important the closer that you are to retirement. As the old saying goes, even the best-laid plans can go to waste.

Market risk and its unpredictable timing aren’t the same for everyone. Should your investment holdings take a hit in your late-career years, it could very much throw your retirement plans off-kilter.

Up until this point, you may have adopted an investment strategy that had growth and wealth accumulation as your top goals. But these priorities tend to change as you get closer to retirement.

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in Annuity
on 10 February, 2021

annuities maximize income

When the World War II generation finally retired, many former workers were able to count on a secure corporate pension to supplement their Social Security income. This pension income lasted for as long as they lived. Then it often continued to pay the surviving spouse after the initial recipient had passed away.

But pensions have largely disappeared from the corporate landscape. In turn, this has left an unexpected hole in the retirement plans of many retirees.

However, many people have found an alternative in annuities as a way to generate guaranteed income that they can count on every month. Annuities can provide a type of privately-funded pension income in a manner unlike any other type of financial instrument in the marketplace today.

Annuities are designed to pay a stream of guaranteed income for as long as someone lives. This holds even if someone receives more money from the insurance company than what was in their annuity contract.

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