Should you invest in a house? An IRA? Stocks and bonds? How should you invest your important money?
The answer is actually quite simple if you can answer just one question.
“What is the purpose of your money and what do you want it to accomplish?”
Most people can’t answer that question immediately. The reason is simple; it is a very hard question to answer. The funds could be for a new car, a vacation home, retirement, education. The answer is dependent on the goals of the person asking the question.
Should you invest in an annuity?
I believe that the basis of all long term investing that concern funds for retirement should be in something safe and secure and free of risk. I also believe that a portion of your long term retirement funds should have some degree of risk. With risk comes the possibility of gain, gain can help offset inflation and add to the retirement pot.
My father didn’t invest in the stock market; he kept his money in the bank. Did he make a mistake being so conservative? Did it cost him money in the long term by not investing more aggressively? No, he didn’t lose money by investing in banks; he lost the “opportunity” to make more money. That was his downside, he lost an opportunity, but he didn’t lose his money, it was still safe and secure.
Consider a plan that includes an annuity as your choice for your safe and secure funds for one simple reason. Insurance companies who provide annuities do not care how long you live, they will accept the responsibility of providing you income, income you cannot ever outlive, regardless of how long you live.
Once you base is in place, then add investments which can have some risk but also some larger rewards. Then as you age and get closer to retirement time, slowly convert your risk investments to the safe and secure side, the annuity side. A simple and easy approach to managing your own retirement plan.
Should you invest in an annuity? Yes, as the foundation of your retirement plan.$
www.RayBuckner.RetireVillage.com
Wednesday, October 2, 2013
Wednesday, September 18, 2013
Use A Safe for Your Important Money
I have a friend named John. You might also have a similar friend. He may be a co-worker, business partner, golfing buddy, your in-law, or your neighbor. My friend John has a special item in his life, John has a safe. This isn’t any ordinary safe; it is a special safe that John keeps his important money in.
John’s safe protects his money so it is never at risk and no one can withdraw John’s money from his safe, except him. He is the only one with the combination to his safe. John’s safe has a special feature, it increases John’s money by paying guaranteed interest each month.
In addition to the protection of the safe, John’s funds in his safe are available to him when he needs them. He can withdraw funds from his safe, he can convert the funds in the safe to income, he can let the funds in the safe grow. John has numerous options and is in control of his safe.
What is John’s safe? His personal safe is a simple, easy to understand guaranteed fixed interest annuity. A fixed interest annuity earns Interest each month that can never be lost. John can withdraw the funds and use them in any manner he chooses. If John selects the guaranteed income option, John can make sure the money in his Safe pays him an income for as long as he lives and that can include John’s wife! Lifetime income neither can ever outlive.
A fixed interest annuity is protected 24 hours a day. Risk is never an option. There is one other feature about John’s safe (guaranteed annuity) should John pass away; the safe automatically changes ownership to John’s designated beneficiary. That change happens almost immediately and without the need for probate and the expenses associated with it.
So like my friend John, you can have your retirement dollars protected in your own safe and it is always there for you risk free, earning interest and awaiting further instructions.$
Get updates on financial and retirement planning delivered to your inbox.
John’s safe protects his money so it is never at risk and no one can withdraw John’s money from his safe, except him. He is the only one with the combination to his safe. John’s safe has a special feature, it increases John’s money by paying guaranteed interest each month.
In addition to the protection of the safe, John’s funds in his safe are available to him when he needs them. He can withdraw funds from his safe, he can convert the funds in the safe to income, he can let the funds in the safe grow. John has numerous options and is in control of his safe.
What is John’s safe? His personal safe is a simple, easy to understand guaranteed fixed interest annuity. A fixed interest annuity earns Interest each month that can never be lost. John can withdraw the funds and use them in any manner he chooses. If John selects the guaranteed income option, John can make sure the money in his Safe pays him an income for as long as he lives and that can include John’s wife! Lifetime income neither can ever outlive.
A fixed interest annuity is protected 24 hours a day. Risk is never an option. There is one other feature about John’s safe (guaranteed annuity) should John pass away; the safe automatically changes ownership to John’s designated beneficiary. That change happens almost immediately and without the need for probate and the expenses associated with it.
So like my friend John, you can have your retirement dollars protected in your own safe and it is always there for you risk free, earning interest and awaiting further instructions.$
Get updates on financial and retirement planning delivered to your inbox.
Thursday, September 5, 2013
Don’t Gamble. Leverage like Buffett
Warren Buffett and other smart investors make money by borrowing to invest in low-risk, low-return securities, sort of like a “specialized margin” account. Other folks, who don’t have enough borrowing power to play the leverage game (interest rates on margin accounts can be high for the little guy), can only generate profits by investing in riskier assets.
The irony about risk taking is that most of us are in the second group, small investors. But it can also include professional investors such as many mutual fund managers. If they don’t take some risk, they lose the opportunity to make money. Often time the reason the market will move with a stock is because the demand for a better return triggers the increase in it’s valuation. This of course drives up the prices of those assets, thus reducing their returns.
That all sounds well and good, but what is the answer? How can you leverage your funds and take advantage just like the big players?
One way is to look at your money from a different point of view, not as money but as “what is the money for?” Have you ever considered why investors like Buffett try and make so much money? Does it mean they can eat better, sleep better, take more vacations?
Their goals are different than the goals of most of us. We want and use our money for life’s demands; education, food, housing and retirement. Their money is for two things: keeping score and their legacy. They mostly do it for status.
So how do we “game” the system? Like I said, by looking at the reason for using money from a different view. Why not look at your retirement money not from how much you can accumulate but by how much income it can provide?
Think of your money for its intended use and for most of us that would be retirement income and money to enjoy the security later in life. There is a way to beat the system, it is easy, simple and the big boys won’t know about it. Why won’t they? Because they don’t care, they only care about their reasons for their money.
How would you like to “earn” 5-7% on your retirement account? You can, it is available and it is guaranteed. How can that be? Simple, if you use your funds as an income instead of a pile of money, many insurance companies will pay that rate on the funds which will be used as retirement funds. It is called an Income Rider and it is available as an add on with annuities. The amount earned in your account stays in the income accumulation side, the amount you actually can receive as retirement is based on other factors such as age. Many contracts are different so do your research carefully.
How can they do that? Insurance companies know how many people will use these funds for this use. They plan for it and they reinsure their liability in the event things change and they pay out more than planned. They insure their obligation to you just like you can insure your retirement income for you and your spouse.
How do they reinsure the retirement obligations promised to you; yes you guessed it, the Warren Buffett’s of the world insure the companies promises.
Want to know more about how these products work, here is an easy to understand video:
https://www.youtube.com/watch?v=ChHaRxguEkM
The irony about risk taking is that most of us are in the second group, small investors. But it can also include professional investors such as many mutual fund managers. If they don’t take some risk, they lose the opportunity to make money. Often time the reason the market will move with a stock is because the demand for a better return triggers the increase in it’s valuation. This of course drives up the prices of those assets, thus reducing their returns.
That all sounds well and good, but what is the answer? How can you leverage your funds and take advantage just like the big players?
One way is to look at your money from a different point of view, not as money but as “what is the money for?” Have you ever considered why investors like Buffett try and make so much money? Does it mean they can eat better, sleep better, take more vacations?
Their goals are different than the goals of most of us. We want and use our money for life’s demands; education, food, housing and retirement. Their money is for two things: keeping score and their legacy. They mostly do it for status.
So how do we “game” the system? Like I said, by looking at the reason for using money from a different view. Why not look at your retirement money not from how much you can accumulate but by how much income it can provide?
Think of your money for its intended use and for most of us that would be retirement income and money to enjoy the security later in life. There is a way to beat the system, it is easy, simple and the big boys won’t know about it. Why won’t they? Because they don’t care, they only care about their reasons for their money.
How would you like to “earn” 5-7% on your retirement account? You can, it is available and it is guaranteed. How can that be? Simple, if you use your funds as an income instead of a pile of money, many insurance companies will pay that rate on the funds which will be used as retirement funds. It is called an Income Rider and it is available as an add on with annuities. The amount earned in your account stays in the income accumulation side, the amount you actually can receive as retirement is based on other factors such as age. Many contracts are different so do your research carefully.
How can they do that? Insurance companies know how many people will use these funds for this use. They plan for it and they reinsure their liability in the event things change and they pay out more than planned. They insure their obligation to you just like you can insure your retirement income for you and your spouse.
How do they reinsure the retirement obligations promised to you; yes you guessed it, the Warren Buffett’s of the world insure the companies promises.
Want to know more about how these products work, here is an easy to understand video:
https://www.youtube.com/watch?v=ChHaRxguEkM
Tuesday, August 27, 2013
The Stock Market, The Magnificient Twenty and Volatility
It’s important to know that even in the best years the stock market carries a 30% chance of loss. So there is always a 1 out of 3 chance the market won’t perform to expectations. Sadly, in good times people think the market will continue to climb. But what are the odds of consistently beating the market and avoiding market meltdowns? What are the odds of becoming a professional athlete? Plenty of people have overcome the odds and made it big in sports. But what do you say to a 50 year old who wants to play in the NFL? We need to be realistic. The older you get, you may not be able to afford the time to regain your losses.
Have you heard of The Magnificent Twenty? They’re a group of 20 in an elite group who lost at least $100 million in the stock market back in 2008. Now here’s a question for you – does anyone have better information than these informed investors? No one complains when the market is roaring, but how vulnerable are normal investors if the top guns don’t see the avalanche coming?
The theme of the fixed/indexed annuity message is safety and security. There is plenty of research and studies to back up the fact that these plans work and they work well. When you are retired, everything works completely different than when you were working. It’s like doing everything in a mirror. Money management activities become opposite to when a person is working. Safe money fixed/indexed annuity accounts grow on a guaranteed basis, with no risk, even in uncertain economies that occur from time to time. It is pretty satisfying to save your retirement money from collapsing and not be in a position where you never have to ask the question “Can I win or lose?” Can you put a price tag on peace of mind?
The safe money fixed/indexed annuities method speaks for itself: The ability to grow money safely, securely, and guarantee a lifetime income. The ability to avoid financial enemies: risk, taxes, and fees. Unfortunately, the average person spends more time planning a vacation than managing their money.
The safe money fixed/indexed annuity owner won’t suffer losses when the market fails, because you never leave the safety and security of a highly rated insurance company. Do you want your hard earned money to have privacy, be protected from probate, and pass automatically to your heirs? Is it desirable to have the potential to increase retirement fund yields without market risk and no brokerage fees?
Do you wish to have an additional stream of income riding piggy-back to your pension and social security? If you have a safe money fixed/indexed annuity, you have all of the above.
Have you heard of The Magnificent Twenty? They’re a group of 20 in an elite group who lost at least $100 million in the stock market back in 2008. Now here’s a question for you – does anyone have better information than these informed investors? No one complains when the market is roaring, but how vulnerable are normal investors if the top guns don’t see the avalanche coming?
The theme of the fixed/indexed annuity message is safety and security. There is plenty of research and studies to back up the fact that these plans work and they work well. When you are retired, everything works completely different than when you were working. It’s like doing everything in a mirror. Money management activities become opposite to when a person is working. Safe money fixed/indexed annuity accounts grow on a guaranteed basis, with no risk, even in uncertain economies that occur from time to time. It is pretty satisfying to save your retirement money from collapsing and not be in a position where you never have to ask the question “Can I win or lose?” Can you put a price tag on peace of mind?
The safe money fixed/indexed annuities method speaks for itself: The ability to grow money safely, securely, and guarantee a lifetime income. The ability to avoid financial enemies: risk, taxes, and fees. Unfortunately, the average person spends more time planning a vacation than managing their money.
The safe money fixed/indexed annuity owner won’t suffer losses when the market fails, because you never leave the safety and security of a highly rated insurance company. Do you want your hard earned money to have privacy, be protected from probate, and pass automatically to your heirs? Is it desirable to have the potential to increase retirement fund yields without market risk and no brokerage fees?
Do you wish to have an additional stream of income riding piggy-back to your pension and social security? If you have a safe money fixed/indexed annuity, you have all of the above.
Thursday, August 8, 2013
Concerned About Trusting An Insurance Company With Your Important Retirement Funds?
How safe is your fixed indexed annuity? Should you trust a fixed indexed annuity with your important retirement funds? What happens if an insurance company were to fail? These and other questions are vitally important and the answers may surprise you.
Why even ask these questions? In the past, investors simply trusted the third party. Now, after the financial meltdown beginning in 2008, questions must be asked.
And answered.
The simple fact remains that retirees and retiring Baby Boomers today are looking for a way to guarantee that their money is safe, and that they will have enough income to last as long as they live.
Income is the more important decision, far more important than having enough money.
“Income is King with the Baby Boomers.”
So is the money safe in an annuity? Baby Boomers are very concerned about safety for one simple reason.
“They Don’t Have Time to Make It Again!”
Other than social security and earned pensions, most retirement investments are not guaranteed and are subject to variations of account values – volatility. How can they be assured their retirement accounts will last as long as they are needed?
Their worries are justified and the number one concern for retiring Baby Boomers is simple: safety – Is my money safe? So, how does this safety work? How are annuities actually guaranteed? The safety of annuities is like a safety net, a safety net to cover any possible occurrence.
Insurance Company Assets: The safety of an Index Annuity is based on the financial strength and claims paying ability of the company which issues the annuity. Annuities are regulated by each individual state Department of Insurance (DOI). The DOI regulates, audits, and sets reserves of the insurance companies. This assures the annuity purchaser of the solvency of the insurance company.
These highly regulated companies are also subject to strict capital reserve requirements which result in reserve level requirements. These capital requirements can be higher than the capital reserve requirements for banks regulated by the FDIC.
Because of the high regulations required by each state’s Department of Insurance, the insurance companies must invest in solid, safe, and suitable vehicles. They invest in some of the most highly-rated and conservative investments available, such as highly rated corporate bonds. In addition, a high percentage of their investments are in U.S. government bonds and U.S. Treasuries.
Annuities are some of the most regulated financial products available today.$
Why even ask these questions? In the past, investors simply trusted the third party. Now, after the financial meltdown beginning in 2008, questions must be asked.
And answered.
The simple fact remains that retirees and retiring Baby Boomers today are looking for a way to guarantee that their money is safe, and that they will have enough income to last as long as they live.
Income is the more important decision, far more important than having enough money.
“Income is King with the Baby Boomers.”
So is the money safe in an annuity? Baby Boomers are very concerned about safety for one simple reason.
“They Don’t Have Time to Make It Again!”
Other than social security and earned pensions, most retirement investments are not guaranteed and are subject to variations of account values – volatility. How can they be assured their retirement accounts will last as long as they are needed?
Their worries are justified and the number one concern for retiring Baby Boomers is simple: safety – Is my money safe? So, how does this safety work? How are annuities actually guaranteed? The safety of annuities is like a safety net, a safety net to cover any possible occurrence.
Insurance Company Assets: The safety of an Index Annuity is based on the financial strength and claims paying ability of the company which issues the annuity. Annuities are regulated by each individual state Department of Insurance (DOI). The DOI regulates, audits, and sets reserves of the insurance companies. This assures the annuity purchaser of the solvency of the insurance company.
These highly regulated companies are also subject to strict capital reserve requirements which result in reserve level requirements. These capital requirements can be higher than the capital reserve requirements for banks regulated by the FDIC.
Because of the high regulations required by each state’s Department of Insurance, the insurance companies must invest in solid, safe, and suitable vehicles. They invest in some of the most highly-rated and conservative investments available, such as highly rated corporate bonds. In addition, a high percentage of their investments are in U.S. government bonds and U.S. Treasuries.
Annuities are some of the most regulated financial products available today.$
Wednesday, July 31, 2013
Avoid Unnecessary Probate Expenses and Time Delays With This Simple Planning Tip
Your IRA, 401 (k), pension plan and other qualified plans can transfer at death without the need for probate by designating a named beneficiary.
When you open a retirement savings account (such as an IRA), you have the option of naming a beneficiary. This beneficiary designee stipulates where these assets will go when you pass away. A beneficiary form commonly takes precedence over a will, because retirement accounts do not fall under probate.
If it has been a while since you named the beneficiary on your accounts, it makes good sense to review them. If you be a mistake for your IRA and other pension assets being inherited by someone you no longer trust or love.
One situation to avoid is leaving the designation blank on the beneficiary form because then the IRA assets may be distributed according to the default provision set by the IRA custodian (the brokerage firm or insurance company custodial hosting the IRA account).
Keep your planning simple, name a beneficiary. If in the future you want to name someone else, easy, you are in control.
This might also be a good time to review all your beneficiary designations on your life insurance policies, annuity contracts and bank accounts. Bank accounts allow for TOD (transfer on death) forms which can also help you avoid probate.
Simple planning with a named beneficiary can save money, time and possibly undo tax liability.$
Thursday, July 25, 2013
Mother, Banks and Options to Avoid Poverty
I found a very interesting letter to the editor in the financial section of my local paper. It started like this:
“My mother is sixty-seven-years old and has saved up a half-million dollars in a bank account earning about 1% interest. Obviously, not a very good interest rate. She wasn’t sure what to do to earn more money on her money. Her house was paid off as well as her car. She had been thrifty her entire life, but still felt like she was making a mistake keeping her money in a normal bank account. I want to find a way to help her.”
I was quite taken by how accurate and common this is. Just think how many people are in this exact situation. Here’s a guy wanting to help his mother and yet her options are so limited. The government’s intentional intervention into the stock and bond market through QE3 has lots of side effects. His mother is an example.
She worked hard and she saved, now she is near the poverty line because of things she has no control over, bank interest rate yields. Many people think the bank sets the interest rates, but they don’t. Interest rates in banks are set by one superior force, the same force that is funding QE3, The Federal Reserve. Banks charge what they are told to charge and as long as the Fed says interest rates are low, they are low.
So what are this mother’s options in this situation? She can’t afford risk and doesn’t have time to earn the funds again if she were exposed to risk. She has to stay in safety and that in of itself can be a death sentence. I would suggest she look at an annuity or a market-linked bank cd.
Good luck, Mom.$
“My mother is sixty-seven-years old and has saved up a half-million dollars in a bank account earning about 1% interest. Obviously, not a very good interest rate. She wasn’t sure what to do to earn more money on her money. Her house was paid off as well as her car. She had been thrifty her entire life, but still felt like she was making a mistake keeping her money in a normal bank account. I want to find a way to help her.”
I was quite taken by how accurate and common this is. Just think how many people are in this exact situation. Here’s a guy wanting to help his mother and yet her options are so limited. The government’s intentional intervention into the stock and bond market through QE3 has lots of side effects. His mother is an example.
She worked hard and she saved, now she is near the poverty line because of things she has no control over, bank interest rate yields. Many people think the bank sets the interest rates, but they don’t. Interest rates in banks are set by one superior force, the same force that is funding QE3, The Federal Reserve. Banks charge what they are told to charge and as long as the Fed says interest rates are low, they are low.
So what are this mother’s options in this situation? She can’t afford risk and doesn’t have time to earn the funds again if she were exposed to risk. She has to stay in safety and that in of itself can be a death sentence. I would suggest she look at an annuity or a market-linked bank cd.
Good luck, Mom.$
Subscribe to:
Posts (Atom)