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Retirement Funding

Make Every Dollar Count!

At this stage in your life, you have better things to do than worry about money — hobbies, traveling, playing with grandchildren, or just plain relaxing. Yet financial concerns can often diminish your quality of life by distracting you from the things you enjoy most. And despite recent proposals from the Bush administration to ease the tax burden on many Americans, the fact remains that high taxes and low interest rates place a heavy strain on most retirees’ assets. Many worry about maintaining their current standard of living. Others might fret about leaving a financial legacy for their heirs. If you share either (or both) of these concerns, you’ll be happy to learn about how to make the most of your retirement savings.

Maintain a Long-term Perspective

With life expectancies growing and exciting medical breakthroughs announced almost every day, many Americans can expect to live well into their 80s and beyond. While longer life spans are good news, they also present a challenge: making your money last for your entire lifetime. You can’t expect much help from fixed-income vehicles; Treasury rates are near their 40-year lows, and the interest on CDs and money market accounts simply might not provide the growth you need. Many financial experts recommend keeping a portion of your retirement assets in growth investments such as stocks.

However, many people want to avoid the risk of losing their money in the stock market. An increasingly popular alternative is the equity-indexed annuity (EIA). For those seeking some of the growth potential of stocks, guaranteed principal, and a long-term outlook, EIAs have a lot to offer. Like more traditional fixed annuities, the principal is guaranteed by an insurance company, but unlike other types of annuities, the earnings are linked, in part, to a specific stock index such as the S&P 500. The interest you earn is usually a percentage of the index’s performance. When the market index rises, you participate in the gain up to a certain amount dictated by each policy, but when the market index declines, you don’t lose any of your principal in most of the products. Generally, you can withdraw your earnings regularly or leave them in the annuity and let them grow tax deferred until needed; however you should read the policy carefully because there may be significant surrender charges associated with EIAs and that surrender period may be up to 10 years. The earnings are not taxable until you actually withdraw them.

Call us to find out if this investment may be suitable for you.

Today is the best day for planning your retirement. We will help you increase your understanding of the common retirement plan components:

  • Social Security
  • Traditional IRA
  • Inherited IRA
  • Roth IRA
  • IRA Rollovers and Transfers
  • 401(k) Plans
  • 403(b) Plans
  • Qualified Plans
  • SIMPLE Plans

Guarantees based on the insurance company’s ability to pay and early withdrawal may cause a loss of principal due to withdrawal charges. Purchasers may experience fees and expenses, included withdrawal charges, market value adjustments, rider premiums, etc. which will affect contract values. Interest credits are based on a formula that takes into account the performance of an index. Purchasers are not investing in the index and will not experience the same returns as the index or a related index mutual fund. Purchasers will participate in only a stated percentage of an increase in an index, as the annuity imposes a “cap rate.” Guaranteed income rider may not be available to all investors and comes with an additional expense.