Emotions and Retirement Income

Emotions drive almost all of our decisions in life. If I were in my late 50’s early 60’s and my broker did not have my investments diversified properly I may have lost 40% of my retirement money this year. I think I would be a little upset and want to do something about it. In such a devastating situation your accumulation timeline to accrue the money you need to live in retirement has now drastically changed; therefore requiring a new financial game plan, an undiversified gamble is no longer the recommended approach.

Knowing that interest rates are at an all time low and that I can only receive a 5 yr guaranteed bank CD at about 2% annually I would think a good portion of your retirement money would be better suited in a 5 yr annuity at 4-5% tax deferred. That would make a lot more sense; you should always at least try to keep up with inflation. There is also 1-3 yr Multi Year Guarantee Annuities available at 2-3.5% annually.

Gambling is not for everyone and especially for the ones that have already gambled and lost big. You don’t have to gamble with your retirement money anymore. There are alternatives available that will not only guarantee your principal but also give you indexed linked returns that can never go backwards. You will not get all of the index growth but you will also not get any of the index loss. For example: if the S & P 500 goes up 10% in a year you could get 8.5% for that year depending on the product you chose. If the S & P was to go down you would not lose a dime and receive 0% for that year. Every year your gains will lock in never to be lost. There are still other Safe Money Alternatives available for those who are considering retirement in the next 5-20yrs that will guarantee between a 5-8% return annually as long as you use these funds for a guaranteed lifetime income, any unspent cash values will go immediately to your beneficiaries at the time of death. These products also allow you to participate in index linked gains while accessing your lifetime retirement income.

As I said earlier diversification has always been the key to success and that is why these strategies are just for the Safe Money assets you have “The money you can not afford to lose” The older you get the higher percentage of your assets belong in the Safe Money category. To get a better understanding and more answers to some of your most immediate retirement concerns visit www.LearnHowToRetire.com