Retire Safe & Tax Free - An Income Stream to Last a Lifetime


money coming from a fawcet

Imagine a retirement-savings well that never runs dry, no matter how long you live.

If that's the dream of future retirees, why are annuities, which make that very promise, such a minuscule part of our collective nest egg?

This so-called annuity puzzle has baffled academics, policymakers and financial advisers for decades. Now, as more retirees shift their focus from accumulating assets to spending them, solutions to the puzzle may finally be emerging.

In exchange for a lump sum, annuities guarantee retirees regular payments for the rest of their lives. Sounds attractive, but investors have long shunned annuities, citing high fees, low returns and the inability to bequeath the money to heirs. Worst of all, there's the "bus" risk -- that is, the chance of getting hit by one, or meeting some other untimely demise and not getting your money's worth.

"I've explored all the perfectly rational reasons people don't like annuities, and I've concluded there's something more fundamental." Namely, we're trained to think in terms of accumulating wealth, with a focus on rates of return, market risk and the like. As an investment, an annuity just doesn't stack up or does it?

If your objective is to ensure enough money to live on no matter how long you live -- think about what your spending needs are instead of accumulating money -- then an annuity is a no-brainer. "I just tell clients that they're buying their own pension and that grabs their attention."

In a world with fewer corporate pensions, longer retirements and substantial 401(k) balances, annuities should loom large in most retirement plans.

Specifics -- such as how much to put into which type of annuity -- would vary depending upon your specific needs. In general, we suggest allocating a portion of your retirement monies into an annuity, or just enough to cover your required expenses.

Because most payouts don't start until later in life, and with the worry of outliving your money, annuities let you spend more freely in retirement. And isn't that what we're all saving for? And when you pass the balance of your account passes to your named beneficiaries. So, contact us today to help you plan for a better tomorrow, my friends.

Marc H. Weiss, Archer Weiss Insurance & Financial Services, Inc. Please Call Toll free: 1-800-831-2901 or (818) 610-8560