tag:blogger.com,1999:blog-58669151229126112642024-03-08T15:16:05.489-08:00Learn How To RetireAn ongoing discussion about annuities and financial security.Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.comBlogger12125tag:blogger.com,1999:blog-5866915122912611264.post-81069939380879089832010-01-13T20:17:00.000-08:002010-01-13T20:20:03.988-08:00Looking Forward: On "Retiree Annuities May Be Promoted by Obama Aides" by Theo Francis<span class="Apple-style-span" style="font-family: 'Times New Roman'; font-size: medium; "><div style="background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: rgb(255, 255, 255); font: normal normal normal 13px/19px Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; padding-top: 0.6em; padding-right: 0.6em; padding-bottom: 0.6em; padding-left: 0.6em; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; background-position: initial initial; "><div id="_mcePaste">On "Retiree Annuities May Be Promoted by Obama Aides" by Theo Francis</div><p>Original Article by Mr. Francis:</p><div><a href="http://www.businessweek.com/news/2010-01-08/retiree-annuities-may-be-pushed-by-obama-after-market-losses.html" mce_href="http://www.businessweek.com/news/2010-01-08/retiree-annuities-may-be-pushed-by-obama-after-market-losses.html" target="_blank">http://www.businessweek.com/news/2010-01-08/retiree-annuities-may-be-pushed-by-obama-after-market-losses.html</a></div><div>Mr. Francis reports that "The Obama administration is weighing how the government can encourage workers to turn their savings into guaranteed income streams following a collapse in retiree accounts when the stock market plunged." The effort to seek public comment is being led by Assistant Labor Secretary Phyllis C. Borzi and Deputy Assistant Treasury Secretary Mark Iwry.</div><div></div><div id="_mcePaste"><br /></div><div id="_mcePaste">Rick Santelli from the CME comments on CNBC as to what the move means: "Instead of a bit of your paycheck going into equities every week, it will probably be going into things like Treasuries it would be a little bit lower return but it would be safer." With respect to Mr. Santelli's observation, we believe the Ms. Borzi and Mr. Iwry are interested in encouraging income streams for retired workers, and not terribly interested in controlling the accumulated income source. Fixed annuities, for instance, are tied to equities index performance, not treasuries market index performance. </div><div id="_mcePaste"><br /></div><div id="_mcePaste">John Brennan, Vanguard CEO, criticized annuities as often expensive and offering little inflation protection. One can assume that the annuity prices will decline if the initiative takes hold, due to sales volume alone. Additionally, a fixed annuity is actually a good hedge against inflation. See my previous post on the subject: <a href="http://www.learnhowtoretire.com/blog/2009/07/13/calculating-how-much-you-will-need-in-retirement-facing-inflation/" mce_href="http://www.learnhowtoretire.com/blog/2009/07/13/calculating-how-much-you-will-need-in-retirement-facing-inflation/">http://www.learnhowtoretire.com/blog/2009/07/13/calculating-how-much-you-will-need-in-retirement-facing-inflation/</a></div><div id="_mcePaste"></div><div><br /></div><div>Citing the 31% average drop in retirement fund balance during the recent market plummet, Borzi is quoted as saying there is “a tremendous amount of interest in the White House” retirement security initiatives. Though there has been a terrific market bounce back since March 2009, the economy is still weak, unemployment is over ten percent nationally, and many experts think the other shoe is about to drop: an explosion of mortgage foreclosures (the root cause for the market drop) this year that will be greater than the recent batch.</div><div id="_mcePaste"></div><div><br /></div><div>The article cites reports from the Retirement Security Project (7/2009), which found that only 2% of 401(k) plan participants convert retirement savings into an annuity on retirement, and from Watson Wyatt Worldwide that about 22 percent of employers with retirement savings plans offered retirees the choice between an annuity and a lump-sum distribution. It seems pretty clear that the administration is interested in addressing the risk of individual's exhausting lump-sum benefit payouts by encouraging workers to consider income streams as an alternative.</div><div></div><div><b><br /></b></div><div><span mce_name="strong" mce_style="font-weight: bold;" class="Apple-style-span" style="font-weight: bold; ">Viewpoint:</span></div><div id="_mcePaste">This measure is an attempt to shed more light on the annuity option, so that workers can have enough income in old age. In this context, it only a mechanism to guarantee individual workers will not outlive their savings. I see it as an opportunity for individuals to convert their funds to fixed annuities, to take part in market gains, to hedge against inflation and to remove market volitity as a retirement savings factor.</div><div></div><div id="_mcePaste">Reducing one's risk and protecting one's principal has got to be job number one in this environment. It is critical that savers find a trusted advisor to discuss this matter with. I think it is crucial that this advisor be be an independent representative. One whose primary job i s your financial security and who is not bound to sell you a single company's product. <a title="Local Independent Annuities Advisors" href="http://www.safemoneyrep.com/" mce_href="http://www.safemoneyrep.com">To find someone in your neighborhood click here.</a></div><div></div><div><div><br /></div><div><b>About this Blog:</b></div><div></div><div>Understanding what is available to you is more important now then ever. Learn How to Retire is part of your educational journey and was developed to help you find the new Safe Money alternatives you need to accomplish your retirement goals. In today’s economic environment one must realize that the only way to find success is through individual empowerment. Once you have taken the time to educate yourself you only then have the power to make the right decisions and put the trust factor on your shoulders. The more you know the more you will succeed. <a title="Learn How To Retire | Retirement Income Planning Resource" href="http://www.learnhowtoretire.com/" mce_href="http://www.learnhowtoretire.com">LearnHowToRetire.com</a> is “Individual Empowerment” Once you have taken the steps to understand then you are free to find the qualified and trusted advisor to help take your knowledge and formulate a plan. <a title="Trusted and Qulaified Advixors" href="http://www.safemoneyrep.com/" mce_href="http://www.safemoneyrep.com">Safemoneyrep.com: Where People Find Trusted and Qualified Advice</a>.</div></div></div></span>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com0tag:blogger.com,1999:blog-5866915122912611264.post-2352903803752641612010-01-12T12:41:00.000-08:002010-01-12T12:42:55.129-08:00What Are Some Fixed Deferred Annuity Contract Benefits?<span class="Apple-style-span" style="font-family: 'Times New Roman'; font-size: medium; "><div style="background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: rgb(255, 255, 255); font: normal normal normal 13px/19px Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; padding-top: 0.6em; padding-right: 0.6em; padding-bottom: 0.6em; padding-left: 0.6em; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; background-position: initial initial; "><p><em><b>Annuity income payments</b></em></p><p>One of the most important benefits of deferred annuities is your ability to use the value built up during the accumulation period to give you a lump sum payment or to make income payments during the payout period. Income payments are usually made monthly but you may choose to receive them less often. The size of the income payments is based on the accumulated value in your annuity and the benefit rate which is in effect when payments start.</p><p>The benefit rate usually depends on your age, sex, and the annuity payment option you choose, if it is a lifetime payout. For example, you might choose payments that continue as long as you live, as long as your spouse lives, or only for a set number of years. There is a table of guaranteed benefit rates in each annuity contract.</p><p>Most companies have current benefit rates as well. The company can change the current rate at any time, but it can never be less than the guaranteed benefit rates.</p><p>When income payments start, the insurance company uses the benefit rate in effect at that time to figure the amount of your income payment. Companies may offer various income payment options, and you, or another person of your choice, may choose the option.</p><p><em><b>Life only</b></em></p><p>The company pays income for your lifetime, but doesn't make any payments to anyone after you die. You might choose this option if you have no dependents, if you have taken care of them through other means or if the dependents have enough income of their own. This payment option usually pays the highest income possible.</p><p><em><b>Life annuity with period certain</b></em></p><p>The company pays income for as long as you live and guarantees to make payments for a set number of years - called the period certain - even if you die. The period certain is usually 10 or 20 years. If you live longer than the period certain, you will still continue to receive payments until you die. However, if you die during the period certain, your beneficiary gets regular payments for the rest of that period. If you die after the period certain, your beneficiary does not receive any payments from your annuity. Each income payment will be smaller than in a life-only income option, because the period certain is an added benefit.</p><p><em><b>Joint and survivor</b></em></p><p>The company pays income as long as either you or your beneficiary lives. You may choose to decrease the amount of the payments after your death, or you may be able to choose to have payments continue for only a set length of time. Again, because the survivor feature is an added benefit, each income payment is smaller than in a life-only income option.</p><p><em><b>Death benefit</b></em></p><p>In some annuity contracts, the company may pay a death benefit to your beneficiary if you die before the income payments start. The most common death benefit is the contract value or the premiums paid, whichever is more.</p><p><br /></p><p></p><div id="_mcePaste">About this Blog:</div><div id="_mcePaste"></div><div id="_mcePaste">Understanding what is available to you is more important now then ever. Learn How to Retire is part of your educational journey and was developed to help you find the new Safe Money alternatives you need to accomplish your retirement goals. In today’s economic environment one must realize that the only way to find success is through individual empowerment. Once you have taken the time to educate yourself you only then have the power to make the right decisions and put the trust factor on your shoulders. The more you know the more you will succeed. www.LearnHowToRetire.com is “Individual Empowerment” Once you have taken the steps to understand then you are free to find the qualified and trusted advisor to help take your knowledge and formulate a plan. www.safemoneyrep.com “Where People Find Trusted and Qualified Advice”</div><div></div><p>About this Blog:<br />Understanding what is available to you is more important now then ever. <a href="http://www.learnhowtoretire.com/" mce_href="http://www.LearnHowToRetire.com" title="REtirement Income Planning Resource">Learn How to Retire</a> is part of your educational journey and was developed to help you find the new Safe Money alternatives you need to accomplish your retirement goals. In today’s economic environment one must realize that the only way to find success is through individual empowerment. Once you have taken the time to educate yourself you only then have the power to make the right decisions and put the trust factor on your shoulders. The more you know the more you will succeed. <a href="http://www.learnhowtoretire.com/" mce_href="http://www.LearnHowToRetire.com" title="Retirement Income Planning Resource">LearnHowToRetire.com</a> is “Individual Empowerment” Once you have taken the steps to understand then you are free to find the qualified and trusted advisor to help take your knowledge and formulate a plan. <a href="http://www.safemoneyrep.com/" mce_href="http://www.Safemoneyrep.com" title="Independent Retirement Planning Experts">Safemoneyrep.com</a>: Where People Find Trusted and Qualified Advice.</p><div><br /></div><p></p></div></span>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com0tag:blogger.com,1999:blog-5866915122912611264.post-70375218788660064172010-01-11T06:35:00.000-08:002010-01-11T06:36:48.639-08:00What charges or fees may be subtracted from my fixed deferred annuity?<span class="Apple-style-span" style="font-family: 'Times New Roman'; font-size: medium; "><div style="background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: rgb(255, 255, 255); font: normal normal normal 13px/19px Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; padding-top: 0.6em; padding-right: 0.6em; padding-bottom: 0.6em; padding-left: 0.6em; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; background-position: initial initial; "><p>Most annuities have charges related to the cost of selling or servicing it. These charges may be subtracted directly from the contract value. <a href="http://www.safemoneyrep.com/" mce_href="http://www.safemoneyrep.com" title="Retirement Income Planning Experts">Ask your agent </a>or the company to describe the charges that apply to your annuity, if any.</p><p><em>Surrender of withdrawal charges</em></p><p>If you need access to your money, you may be able to take all or part of the value out of your annuity at any time during the accumulation period. If you take out part of the value, you may pay a withdrawal charge. If you take out all of the value and surrender, or terminate, the annuity, you may pay a surrender charge. In either case, the company will figure the charge as a set percentage of the value of the contract, of the premiums you have paid or of the amount you are withdrawing. The company may reduce or even eliminate the surrender charge after you've had the contract for a stated number of years (term). A company may also waive the surrender charge when it pays a death benefit.</p><p>Some annuities have stated terms. When the term is up, the contract may automatically expire or renew. You are usually given a short period of time, called a window, to decide if you want to renew or surrender the annuity. If you surrender during the window, you won't have to pay surrender charges, but if you renew, the surrender or withdrawal charges may start over.</p><p>For some annuities, there is no charge if you surrender your contract when the company's current interest rate falls below a certain level. This is sometimes called a bail out option.</p><p>In a flexible premium annuity, the surrender charge may apply to each premium paid for a certain period of time. This may be called a rolling surrender or withdrawal charge. Some annuity contracts have a market value adjustment feature. If interest rates are different when you surrender your annuity than when you bought it, a market value adjustment (MVA) may make the cash surrender value higher or lower. Since you and the insurance company share this risk, an annuity with an MVA feature may credit a higher rate than an annuity without that feature.</p><p><em>Free withdrawal</em></p><p>Your annuity may have a limited free withdrawal feature. That lets you make one or more withdrawals without a charge. The size of the free withdrawal is often limited to a set percentage of your annuity contract value. If you make a larger withdrawal, you may pay withdrawal charges. You may lose any interest above the minimum guaranteed rate on the amount withdrawn.</p><p>Some annuities waive withdrawal charges in certain situations, such as death, confinement in a nursing home or terminal illness.</p><p><em>Contract fee</em></p><p>A contract fee is a flat dollar amount charged either once or annually.</p><p><em>Transaction fee</em></p><p>A transaction fee is a charge per premium payment or other transaction.</p><p><em>Percentage of premium charge</em></p><p>A percentage of premium charge is a charge determined from each premium paid. The percentage may be lower after the contract has been in force for a certain number of years, or after total premiums paid have reached a certain amount.</p><p><em>Premium tax</em></p><p>Some states charge a tax on annuities. The insurance company pays this tax to the state. The company may subtract the amount of the tax when you pay the premium, when you withdraw your contract value, when you start to receive income payments or when it pays a death benefit to your beneficiary.</p><p>Our Expert Advisors are always available to answer your questions. To learn more about charges and fees associated with fixed deferred annuities <a href="http://www.learnhowtoretire.com/ask-the-expert.php" mce_href="http://www.learnhowtoretire.com/ask-the-expert.php" title="The Retirement Income Planning Experts">click here</a>. </p><p>To speak with an advisor in your area <a href="http://www.safemoneyrep.com/" mce_href="http://www.safemoneyrep.com" title="Local and Independent Safe Money Advisors">click here</a>.</p><p><br /></p><p>About this Blog:<br />Understanding what is available to you is more important now then ever. <a href="http://www.learnhowtoretire.com/" mce_href="http://www.LearnHowToRetire.com" title="The retirement income planning resource">Learn How to Retire</a> is part of your educational journey and was developed to help you find the new Safe Money alternatives you need to accomplish your retirement goals. In today’s economic environment one must realize that the only way to find success is through individual empowerment. Once you have taken the time to educate yourself you only then have the power to make the right decisions and put the trust factor on your shoulders. The more you know the more you will succeed. <a href="http://www.learnhowtoretire.com/" mce_href="http://www.LearnHowToRetire.com" title="Retirement Literacy Resource">www.LearnHowToRetire.com</a> is “Individual Empowerment” Once you have taken the steps to understand then you are free to find the qualified and trusted advisor to help take your knowledge and formulate a plan.<a href="http://www.safemoneyrep.com/" mce_href="http://www.safemoneyrep.com" title="Local and Independent Safe Money Experts">www.safemoneyrep.com</a> “Where People Find Trusted and Qualified Advice”.</p></div></span>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com1tag:blogger.com,1999:blog-5866915122912611264.post-37526908248373056622009-12-22T20:37:00.000-08:002009-12-22T20:40:09.464-08:002012: The End is Near. Are You Prepared?<span class="Apple-style-span" style="font-family: 'Times New Roman'; font-size: medium; "><div style="background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: rgb(255, 255, 255); font: normal normal normal 13px/19px Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; padding-top: 0.6em; padding-right: 0.6em; padding-bottom: 0.6em; padding-left: 0.6em; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; background-position: initial initial; "><div id="_mcePaste">That's right folks. The end of the world. We are going to be done in by one of a number of scheduled calamities or some combination of them. Our prospects are not bright when you consider the fact that the Mayan Calendar comes to a sudden and abrupt end on 12-21-2012, when the earth finds itself aligned with the sun and a gaping hole in the center of our galaxy at the height of the solar maximum.</div><div id="_mcePaste">Not to mention that this time frame is cited in a number of apocalyptic texts, and there are asteroids we don't even know of hurtling towards us, and the geo-thermal cauldron is due for it's regular, every- sixty-five million-years-or-so explosion, probably under Yellow Stone national park, and the magnetic poles are due to shift.</div><div id="_mcePaste">Also, the History Channel has all but dedicated all of its programming to the subject, and of course there was the recent blockbuster movie delineating our various demise opportunities.</div><div>From so many angles, we are in for it.</div><div>What I do know is this: Catastrophe aside, the average lifespan for a US citizen is a healthy one that reaches into seven decades, somewhat longer than we would like to be working. And given the fragility of our financial markets and the frightening reliance of our blue chip stocks on credit, I am sometimes more scared of surviving the end. When it comes to our finances the end of life is not the true concern, it is the end of our savings. Every year it cost us more just to live the way we are accustomed to.</div><div>Armageddon or not, it is never too early or too late to take control of our monetary future and empower ourselves through financial awareness and education. The internet is endless and has allowed us to use the knowledge of others to transform the way we think and the way we make decisions. Take advantage of the resources available to you, especially when it comes to your retirement concerns.</div><div>Take some time to find ways to lock your retirement income tight and keep it growing guaranteed,<a title="Retirement Charts" href="http://www.learnhowtoretire.com/retirement_graphs.php" mce_href="http://www.learnhowtoretire.com/retirement_graphs.php">View this chart</a> to see what I mean.</div><div>About this Blog:</div><div id="_mcePaste">Understanding what is available to you is more important now then ever. Learn How to Retire is part of your educational journey and was developed to help you find the new<a title="Safe Money Alternatives" href="http://www.safemoneyreps.com/" mce_href="http://www.safemoneyreps.com"> Safe Money alternatives</a>you need to accomplish your retirement goals. In today’s economic environment one must realize that the only way to find success is through individual empowerment. Once you have taken the time to educate yourself you only then have the power to make the right decisions and put the trust factor on your shoulders. The more you know the more you will succeed.</div><div><a title="Learn How To Retire" href="http://www.learnhowtoretire.com/" mce_href="http://www.LearnHowToRetire.com">www.LearnHowToRetire.com</a> is “<a title="Individual Empowerment" href="http://www.individualempowerment.com/" mce_href="http://www.IndividualEmpowerment.com">Individual Empowerment</a>” Once you have taken the steps to understand then you are free to find the qualified and trusted advisor to help take your knowledge and formulate a plan.</div><div><a href="http://www.safemoneyrep.com/" mce_href="http://www.safemoneyrep.com">www.safemoneyrep.com</a> “Where People Find Trusted and Qualified Advice"</div></div></span>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com0tag:blogger.com,1999:blog-5866915122912611264.post-1354245818864549782009-10-08T08:06:00.000-07:002009-10-08T08:08:43.307-07:00Real World Index Annuity Returns<span class="Apple-style-span" style="font-family: 'Times New Roman'; font-size: medium; "><div style="background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: rgb(255, 255, 255); font: normal normal normal 13px/19px Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; padding-top: 0.6em; padding-right: 0.6em; padding-bottom: 0.6em; padding-left: 0.6em; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; background-position: initial initial; "><p><span style="font-family:Arial;font-size:100%;color:#333333;">The </span><a href="http://fic.wharton.upenn.edu/fic/" mce_href="http://fic.wharton.upenn.edu/fic/" target="_blank"><span style="font-family:Arial;font-size:100%;color:#0000FF;"><u>Wharton Financial Institutions Center</u></span></a><span style="font-family:Arial;font-size:100%;color:#333333;"> from the prestigious </span><a href="http://www.wharton.upenn.edu/" mce_href="http://www.wharton.upenn.edu/" target="_blank"><span style="font-family:Arial;font-size:100%;color:#0000FF;"><u>Wharton School</u></span></a><span style="font-family:Arial;font-size:100%;color:#333333;"> (of Business) at the </span><a href="http://www.upenn.edu/" mce_href="http://www.upenn.edu/" target="_blank"><span style="font-family:Arial;font-size:100%;color:#0000FF;"><u>University of Pennsylvania</u></span></a><span style="font-family:Arial;font-size:100%;color:#333333;"> released a </span><a href="http://fic.wharton.upenn.edu/fic/Policy%20page/RealWorldReturns.pdf" mce_href="http://fic.wharton.upenn.edu/fic/Policy%20page/RealWorldReturns.pdf" target="_blank"><span style="font-family:Arial;font-size:100%;color:#0000FF;"><u>study</u></span></a><span style="font-family:Arial;font-size:100%;color:#333333;"> yesterday entitled <em>Real World Index Annuity Returns</em>. This study provides the first empirical exploration of fixed indexed annuity returns based upon actual contracts that were sold and actual interest that was credited on those contracts. The study includes the following findings, none of which should be surprising:<br /><br />• FIA returns have been competitive with alternative portfolios of stocks and bonds.<br />• FIA design has limited the downside returns associated with declining markets.<br />• FIAs have achieved respectable returns in more robust equity markets.<br />• Studies that have criticized FIAs are typically based on hypothesized crediting rate formulae, constant participation rates and caps, and unrealistic simulations of stock market and interest rate behavior. When actual policy data are used, the conclusions change.<br /><br />The Wharton study concluded that from 1997 through 2007, for the contracts examined, five-year annualized returns for FIAs averaged 5.79%. These returns compare to 5.39% for taxable bond funds and 4.73% for traditional fixed annuities over the same period. The study also found that for the period from April 1996 through December 2008, a specific and typical FIA's returns bested the S&P 500 alone 66% of the time and a 50/50 mix of one-year Treasury Bills and the S&P 500 80% of the time. <br /><br />Not surprisingly, the study finds that FIAs are particularly desirable for consumers who are especially concerned with avoiding losses because they are "designed in a way to avoid downside risk [and] they tend to produce preferred return patterns for such [risk-averse] consumers when compared to alternative investment strategies that expose consumers to significant levels of that risk."<br /><br />The study's conclusion won't be a surprise to those familiar with FIAs:</span></p><p><span style="font-family:Arial;font-size:100%;color:#333333;">How will index annuities perform in the future? We do not know but the concept has proven to work in the past and any articles should reflect this. FIAs were not designed to be direct competitors of index investing nor have FIAs been promoted to provide returns to compete with equity mutual funds or ETFs. The FIA is designed for safety of principal with returns linked to upside market performance.</span></p><p><span style="font-family:Arial;font-size:100%;color:#333333;">We already knew that an FIA can be a good product for nearly any consumer and that FIAs are particularly advantageous for risk-averse consumers. The Wharton Financial Institutions Center has now provided a powerful tool -- from a respected an unbiased authority -- to support and substantiate what we already knew. <br /><br /></span><a href="http://fic.wharton.upenn.edu/fic/Policy%20page/RealWorldReturns.pdf" mce_href="http://fic.wharton.upenn.edu/fic/Policy%20page/RealWorldReturns.pdf" target="_blank"><span style="font-family:Arial;font-size:100%;color:#0000FF;"><u>Real World Index Annuity Returns</u></span></a></p><p><span style="font-family:Arial;font-size:100%;color:#333333;">About this Blog:</span></p><p><span style="font-family:Arial;font-size:100%;color:#333333;">Understanding what is available to you is more important now then ever. Learn How to Retire is part of your educational journey and was developed to help you find the new Safe Money alternatives you need to accomplish your retirement goals. In today’s economic environment one must realize that the only way to find success is through individual empowerment. Once you have taken the time to educate yourself you only then have the power to make the right decisions and put the trust factor on your shoulders. The more you know the more you will succeed. </span><a href="http://www.learnhowtoretire.com/" mce_href="http://www.learnhowtoretire.com/" target="_blank"><span style="font-family:Arial;font-size:100%;color:#0000FF;"><u>www.LearnHowToRetire.com</u></span></a><span style="font-family:Arial;font-size:100%;color:#333333;"> is <strong>“Individual Empowerment”</strong> Once you have taken the steps to understand then you are free to find the qualified and trusted advisor to help take your knowledge and formulate a plan. </span><a href="http://www.safemoneyrep.com/" mce_href="http://www.safemoneyrep.com/" target="_blank"><span style="font-family:Arial;font-size:100%;color:#0000FF;"><u>www.safemoneyrep.com</u></span></a><span style="font-family:Arial;font-size:100%;color:#333333;"> <strong>“Where People Find Trusted and Qualified Advice”</strong></span></p></div></span>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com0tag:blogger.com,1999:blog-5866915122912611264.post-22965755772319669302009-09-16T10:42:00.001-07:002009-09-16T10:46:12.709-07:00Emotions and Retirement IncomeEmotions 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.<br /><br />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.<br /><br />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.<br /><br />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 <a href="http://www.learnhowtoretire.com">www.LearnHowToRetire.com</a>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com0tag:blogger.com,1999:blog-5866915122912611264.post-47718209708438643652009-08-12T21:32:00.000-07:002009-08-12T21:33:30.682-07:00Annuity AlternativesOn the one hand you have what has been shown to work, meaning it supplies you with retirement income: The fixed-indexed annuity. On the other hand you have new products being engineered by brokerages because what they have always said would work, didn't... umm... well... work. Now I am more about the deeper historical data than I am the recent trends, but I have to point this out since I made mention of it in my last post: FIAs are growing in popularity because they make sense. They just do. There has been, to say the least, an explosive increase in consumer interest of fixed-indexed annuities.<br /><br />Now I had planned on providing a boring old statistical comparison of CDs and FIAs over the last twenty years, but during the last week I noticed a lot more rhetorical traffic around "annuity alternatives." I think now is a good time to stop and put a few volleys back in the serving court where they belong. What I mean is this: don't listen to the crazy talk.<br /><br />Yep there it is again. This time, it is coming from the engineers of doom themselves. The very ones who helped you lose your money are peddling "safer" products.<br /><br />Where were these products last year, when the drunk-drivers owned the road? Why is their advice now worthwhile and worth another whirl? That was a rhetorical question. Not for nothing, the hangovers own the road today and they kept their licenses. Lesson: drive carefully.<br /><br />Alright, I've gone overboard. For one thing, if there is a mutual fund company I would recommend, it goes by the name Vanguard. In my opinion, the class of the industry. I don't mean to bad-mouth this organization because their practices, to my knowledge, are certainly not representative of the bad behavior of the industry in the horribleness that ensued last year. That being said, I don't recommend mutual fund companies. I don't like the risk. I want a boat in retirement. It doesn't need to be ninety feet long anymore if ninety feet means it could easily be particle board in the surf, depending on the seas.<br /><br />I have no trust in the market or those that play it. I want guarantees. I don't want alternatives to guarantees. I lost a lot of bank last year on the advice of securities experts. I'll take my pension, thank you. I created my own pension with a Safe Money representative. It'll be there when I get there (retirement). I will lose nothing, regardless of another tanking market. My money is safe. The alternative to safe money is called gambling.Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com1tag:blogger.com,1999:blog-5866915122912611264.post-52993151610905066032009-08-10T20:19:00.000-07:002009-08-10T20:23:17.818-07:00Fixed Indexed Annuities are growing in popularity because they make SenseI was listening to this guy today. A pretty sharp guy, more or less, is what I thought as I took in what he was saying, until he started with the crazy talk. I can spot crazy talk pretty quick these days, when it comes to money. Listening to crazy talk cost me a healthy chunk of my retirement savings recently, and you know the saying, "Fool me twice..."; I tend to be on guard and on the lookout for crazy talk. (FYI, at the time, it was the stock advice from all the expert advisors.) So when this otherwise reasonable fellow starts telling me that it is madness to purchase an annuity these days because interests rates are going to fly and the market is going to boom, my crazy talk antennae go straight up. You know how I spot crazy talk. Crazy talk predicts the future. Crazy talk speculates and tells me what I need to do with my retirement savings. I don't listen to crazy talk. Neither should you.<br /><br />Stop the madness, the crazy talker says: It is unwise to lock in for 5 years because some very smart people think interest rates are going to rise. Unless you desperately need to earn an extra two percent, keep your money in a money market account. Current money market rates are at 1%. <br /><br />What kind of advice is that? <br /><br />I'll tell you what kind of advice that is. It is unsound advice. Keep on earning 1% and don't earn an extra 2 percent where you can? What is left out and is important is the gains you earn with your annuity are tax-deferred. What else is important is this advice ignores inflation. If the recommendation is to keep your money liquid, so you can move it into a risky fund at some unspecified point in the future, or when CD rates or money market rates suddenly pay exuberant returns, the recommendation will only cost you money. I am reminded of something I heard recently: "Brokers are only finding more creative ways to lose you money". This is one of the most creative yet. <br /><br />If you keep your money liquid by not saving it or putting it into a low return money market account, you are actually losing money to inflation. I point you to our last post about the importance of making sure your investment returns out-pace inflation.<br /><br />If you put funds into a fixed indexed annuity, you benefit from market index growth, your principle is protected from the losses that many us of suffered last year when the markets went over a cliff due to the sub-prime mess (one of my IRAs lost 40%, and as you know, I was not alone), your returns out-pace inflation and your gains are tax-deferred.<br /><br />What else is important is if you extend your investment horizon, you earn more. We are talking about retirement savings here. We aren't talking about casino money. You should be looking to lock it up longer so there is more income in retirement.<br /><br />To provide more insight into the soundness of the FIA strategy, and the unsoundness of brokers' recommendation to avoid them, we will be turning again and again to history (markets, interest rates, policy) in this blog, because it is true that those who do not learn from it are doomed to repeat it. Our business is your financial security. We want you to learn from history (which is why our domain name is learnhowtoretire.com and not learnhowtogambleyourretirementsavings.com or learnhowtoloseyourretirementsavingsbylisteningtoyourbroker.com). We provide the history, and connect you to local, independent representatives that will advise you on how keep your money safe and create your own personal pension.Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com1tag:blogger.com,1999:blog-5866915122912611264.post-73723751882298571082009-07-20T16:48:00.000-07:002009-07-20T18:33:26.573-07:00Calculating how much you will need in retirement: Factoring Inflation<span class="Apple-style-span" style=" color: rgb(68, 68, 68); line-height: 19px; font-family:Geneva;font-size:14px;"><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">An old friend bought me a book about tackling the subject of how to approach the last third of your life – great book – chock full of humor and usable tactics to employ in the battle against age. I recommend everyone read it. Frequently. Because there is a lot of good advice in it and, if you are at all like me, some of it is bound to fall out of your head from time to time. The name of the book is “<a href="http://www.youngernextyear.com/" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; text-decoration: none; color: rgb(34, 102, 170); background-position: initial initial; ">Younger Next Year*</a>“*, by Chris Crowley and Henry S. Lodge, M.D.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">There is some real-down-to-earth advice on just about every aspect of living the last half or last third of your life. Some of the most useful and sobering can be found in chapter thirteen: Chasing the Iron Bunny. In this section the authors declare matter-of-factly: “There’s one change that hits in retirement that you cannot duck and that you must prepare for as early as possible. <em style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; font-style: italic; background-position: initial initial; ">There’s less dough</em>“. The statement itself is not particularly insightful but awesomely important because the fact is so often and so easily overlooked by too many of us.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">What is particularly impressive is the advice the authors provide on calculating how much you will need in retirement. Here is a brief breakdown:</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">1. “Make a realistic estimate of how much income per year you are going to have in retirement.”</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">2. “Unless your income is inflation-protected, adjust it downward by five percent.”</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">3. “Assume things will be worse and adjust downward another five percent.”</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">4. “Take a hard look at your prospective sources of income. Calculate <strong style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; color: rgb(102, 102, 102); font-weight: bold; background-position: initial initial; ">coldly</strong> how reliable they are and make appropriate adjustments.”</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">The chapter goes on to help us approach and cope with living on a fraction of what we are currently accustomed to. I will be visiting the points above and use them to help us develop a financial strategy toward retirement and throw in some recent history to view different scenarios.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">First things first, it is critical that your income source includes investments whose returns outpace the rate of inflation. The rate of interest earned on a five year CD currently does not provide the edge required. I suggest you extend the length of the accumulation phase, as the longer the accumulation phase, the higher the rate of interest gained.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">Be conservative in your calculations. Assume a longer retirement horizon. People are living longer these days. If you follow the book’s instructions, you will be living a whole lot better longer.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">If you purchase a 10 year CD instead of a five year CD you can gain up to a full percentage point in interest. If you purchase a fixed income annuity you can gain up to 5 percent more and can even decrease the length of the accumulation phase if you wish. Even in poor performing market periods, your FIA will protect your income against inflation. If the market performs well your FIA will outperform any CD.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">If you follow the advice of the authors, the downward adjustments you need to make in compiling a realistic estimate of how much income per year you will need in retirement are drastic. But they need to be. Inflation alone eats away at retirement income value and recent history tells us just how precarious our nest egg is when tied to market performance.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">Above all else, protect your principle.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">In the coming articles we will discuss, among other things, a comparison of possible retirement income sources and an evaluation of the reliability of each. We will also discuss just how important it is to speak with a financial advisor.</p><p style="margin-top: 0.5em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; line-height: 1.5em; background-position: initial initial; ">To cite the authors of “Younger Next Year” once more: You do not want to be swimming away from the wreckage at seventy. You need to talk to someone and start planning as soon as possible. At the very least, start doing some research on your own. Visit the <a href="http://www.learnhowtoretire.com/retirement-planning.php" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; padding-top: 0px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 14px; vertical-align: baseline; background-image: initial; background-repeat: initial; background-attachment: initial; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; text-decoration: none; color: rgb(34, 102, 170); background-position: initial initial; ">LHTR Planning section </a>to begin.</p></span>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com0tag:blogger.com,1999:blog-5866915122912611264.post-90559324328066367722009-05-08T11:45:00.000-07:002009-07-16T07:06:24.197-07:00Retirement Planning is a Civic Responsibilty<span style="font-family:trebuchet ms;">I received this headline in my email today from a Financial News Subscription service: "75% of Baby Boomers aren't prepared for retirement." I get this sense that many folks now approaching retirement age are looking over the meltdown of the prior months with a kind of glassy-eyed wonder and disbelief. I also get the feeling that many of this number are in fact part of the group that the news subscription service identifies as not being prepared for retirement. </span><br /><br /><span style="font-family:trebuchet ms;">It is this group that has me worried. A recent study of American workers by the Employee Benefit Research Institute finds that only 13% of retired persons think they will be able to live comfortably on their retirement savings. The reverberative effects of such numbers can be staggering. Consider this:By 2030, spending for Social Security, Medicare and Medicaid will amount to almost 60% of the federal budget . This coverage is a good thing. But there is a tremendous risk that it will put future generations into a national debt and tax situation that is back-breaking. Strong individual investment strategies need to be hammered out now to prevent an untenable financial situation a few decades from now.</span><br /><br /><span style="font-family:trebuchet ms;">It is incumbent on all of us to be our own advocates in the face of difficult economic circumstances. It is important that we be stewards of our own financial security so that we are not simply transferring financial burden onto our heirs. There are sound and safe strategies that can be implemented today, and should be, to maximize retirement savings without sacrificing spending flexibility. </span><br /><br /><span style="font-family:trebuchet ms;">A large part of this discussion is to help people understand, they can still live comfortably throughout their retirement even though they have lost significant amounts of money due to the economic decline. The opportunities available for those approaching retirement have changed drastically over the years. Post and Pre retirees can continue to accumulate wealth for their estate and for themselves without having to experience any significant decrease in their retirement spending; with the correct application of guaranteed income riders available today.</span><br /><br /><span style="font-family:trebuchet ms;">An income rider pays out, without annuitization. This allows for more flexibility and access to emergency funds.</span><br /><br /><span style="font-family:trebuchet ms;">When you annuitize a contract you set a defined amount of income for a chosen duration of time without the ability of change. At the end of the chosen time period your funds have been completely withdrawal at a minimal interest rate. There for the trade-off for receiving this income is the loss of emergency liquidity and control. For instance, the amount of time you draw these funds cannot be adjusted. The amount of payment cannot be modified once annuitized. </span><br /><br /><span style="font-family:trebuchet ms;">Income riders allow you to exert more control over your income stream. You still have enough control to take more then the allotted income if needed. If you were to elect income from most income riders, the majority of your principal would still have the ability to be linked to a guarantee rate, an index or another form of growth potential unlike annuitization.</span><br /><br /><span style="font-family:trebuchet ms;">This alterative allows you to guarantee an income you can not out live as well as give you the opportunity for addition index linked or guaranteed interest rate gains.</span>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com1tag:blogger.com,1999:blog-5866915122912611264.post-14514507308969696732009-04-20T14:58:00.000-07:002009-04-20T20:17:02.158-07:00Safe Money Representatives and Safe Money Resource Launch "Learn How to Retire" Web Resource<div>Safe Money Representatives and Safe Money Resource Launch "Learn How to Retire" Web Resource</div><div><br /></div><div>Burlington City, NJ., 20 April, 2009 - In response to the continuing turmoil in today's financial markets, and the growing sense of unease, Safe Money Representatives announces the launch of their new digital retirement information resource http://www.learnhowtoretire.com. </div><div>"Losing money has become a collective concern among those approaching retirement age. It is important that everyone confronts this concern through education, understanding, communication and planning.” says Brent Meyer, SMR President. </div><div><br /></div><div>"All financial objectives need to be put back on the table and evaluated. Our feeling is that now is the perfect time to start planning for your future and making sure the money you need to live on will be there for your retirement. There are amazing new strategies for accumulating wealth while protecting it from losses. We want to make sure every person interested in learning about retirement planning has the resource to understand what is available to them and is aware of their options." </div><div><br /></div><div>"More than anything, we want to facilitate conversations between investors and advisors so that every person interested in learning has access to qualified information and qualified advice. This is how LearnHowToRetire.com will help thousands of people to protect their wealth and plan for a comfortable retirement. We don't disguise who we are or where we come from, but make it clear that LearnHowToRetire.Com is designed to be a research center for individuals looking to be educated on retirement planning, and to be a toolbox for investors reevaluating their investment strategies that are now more interested in Safe Alternatives for their clients. Now is the time for everyone to learn all they can about retirement in terms of financial preparedness and we are excited to be able to contribute.”</div><div><br /></div><div>“LearnHowToRetire.Com is continually updated with Safe retirement strategies and advice from all over the web, and from our network of certified and trusted experts. We want investors and financial professionals to see all sides of the retirement planning conversation. We will launch a blog shortly to get the conversation going and to keep it going. We will also launch a live chat system to provide real-time answers to investors’ questions. This site is offered as a free service to individuals to learn about retirement from a safe perspective so they can make educated choices that are right for them. We are most concerned for the folks out there who don't have a financial plan in place as they approach retirement, and who could very shortly find themselves faced with having to select from a small set of very bad choices. Simply put: It is never to early or to late to learn how to retire."</div><div><br /></div><div>Safe Money Resource, located in Burlington City NJ, is the resource hub for a network of qualified financial representatives who meet the highest standards of ethical conduct and have proven records of integrity, knowledge and respect for helping people make the right decisions in planning for their retirement. Safe Money Rep is an online tool that allows individuals to find certified, local financial professionals who can help walk them through different safe income planning and retirement planning options.</div><div><br /></div><div>For more information about LearnHowToRetire.com, Safe Money Representatives or Safe Money Resource call (800)790-7791 or leave message at: 1-800-787-2406</div><div><br /></div><div>Contact:</div><div>Brent Meyer</div><div>Safe Money Resource</div><div>351 High Street</div><div>Suite #201</div><div>Burlington City, NJ 08016</div><div><br /></div><div>Phone:(800)790-7791</div><div>Fax:(609)747-0277</div><div><br /></div><div>http://www.LearnHowToRetire.com</div><div>http://www.SafeMoneyResource.com</div><div>http://www.SafeMoneyRep.com</div>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com0tag:blogger.com,1999:blog-5866915122912611264.post-38550018471319332192009-04-20T14:37:00.000-07:002009-04-21T13:51:15.727-07:00Never More Important Than Now: Learn How To Retire<span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">Yesterday marked the official release of </span></span><a href="http://www.learnhowtoretire.com/"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">LearnHowtoRetire.com</span></span></a><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;"> and we don't think it happened a moment too soon. Given the economic climate today, everyone, young and old, should be giving careful consideration to retirement planning. See this article posted last week by the AP: </span></span><a href="http://www.google.com/hostednews/ap/article/ALeqM5hWfCM1tcJYNZv4Sq4t1uALg__bmgD97I1GS82"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">http://www.google.com/hostednews/ap/article/ALeqM5hWfCM1tcJYNZv4Sq4t1uALg__bmgD97I1GS82</span></span></a><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;"> </span></span><span class="Apple-style-span" style=" line-height: 24px; "><span class="Apple-style-span" style="font-weight: bold;"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">Economy dampens hope of a comfortable retirement, </span></span></span><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">by David Pitt. </span></span><span class="Apple-style-span" style=" line-height: normal; "><span class="Apple-style-span" style="line-height: 24px; "><span class="Apple-style-span" style=" "><span class="Apple-style-span" style=" "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">Since this constitutes our first official bog entry, an evaluation of this article seems like a good place to start.</span></span></span></span></span><span class="Apple-style-span" style=" line-height: 24px; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;"> The subject of the article is a recent study performed </span></span><span class="Apple-style-span" style="border-collapse: collapse; line-height: normal; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">by </span></span><span style=" line-height: 18px; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">the nonpartisan Employee Benefit Research Institute, which has provided some very sobering insights into the role many American workers are taking in their own retirement planning process. Here are some of the key takeaways cited in the article:</span></span></span></span></span></span></span><div><span class="Apple-style-span" style="border-collapse: collapse; line-height: 18px;font-family:Arial;font-size:13px;"><span class="Apple-style-span" style=" line-height: normal; font-family:arial;"><ul><li style="margin-left: 15px; "><span style=" line-height: 18px; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">13% of US workers say they will be able to live comfortably in retirement.</span></span></span></li><li style="margin-left: 15px; "><span style=" line-height: 18px; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">20% of retired people surveyed believe they will be financially secure, down 50% from 1 year ago.</span></span></span></li><li style="margin-left: 15px; "><span style=" line-height: 18px; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">Less than half of the workers surveyed have tried to calculate how much retirement savings they will need.</span></span></span><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;"><br /></span></span></li><li style="margin-left: 15px; "><span style="line-height: 18px; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">Only 7 percent say they have used an Internet calculator</span></span></span></li><li style="margin-left: 15px; "><span style="line-height: 18px; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">Less than one fifth say they have checked with an advisor</span></span></span></li><li style="margin-left: 15px; "><span class="Apple-style-span" style="line-height: 18px;"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">41% of workers that don't have</span></span><span class="Apple-style-span" style="border-collapse: separate; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;"> defined benefit retirement plan at work believe they have one</span></span></span></span></li></ul><div><span class="Apple-style-span" style="border-collapse: separate; line-height: 18px;"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">These are only a few of the statistics provided by the study. I urge you to read the article to get the full import of it's contents. To me it is very concerning all around, but specifically from these three angles:</span></span></span></div><div><ol><li><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">While only 13% of workers polled believe they will be able to live comfortably in retirement, less than 20% of those polled have discussed the matter with an advisor.</span></span></li><li><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">Many people believe they have a defined benefit plan at work, when in fact they have a defined contribution plan, or worse, no plan at all.</span></span></li><li><span class="Apple-style-span" style="border-collapse: separate; line-height: 18px; "><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">Only 44 percent of workers say they have tried to calculate how much money they'll need to have saved for retirement. Another 44% is just guessing.</span></span></span><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;"><br /></span></span></li></ol><div><span class="Apple-style-span" style="border-collapse: separate; line-height: 18px;"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">This underscores the fact that individual investors aren't taking the appropriate action to educate themselves on retirement planning or haven't contacted a financial advisor to begin the process of calculating how much they will need in retirement.</span></span></span></div><div><span class="Apple-style-span" style="border-collapse: separate; line-height: 18px;"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;"><br /></span></span></span></div><div><span class="Apple-style-span" style="border-collapse: separate; line-height: 18px;"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">I wonder if data like this indirectly points to a kind of distrust individual investors have developed for financial counselors given the financial upheaval over the last year.</span></span></span></div><div><span class="Apple-style-span" style="border-collapse: separate; line-height: 18px;"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;"><br /></span></span></span></div><div><span class="Apple-style-span" style="border-collapse: separate; line-height: 18px;"><span class="Apple-style-span" style="font-size: small;"><span class="Apple-style-span" style="font-family: verdana;">One thing is for sure: Individuals, most importantly those of retirement age or appraoching it, cannot simply keep their fingers crossed and hope for the best.</span></span></span></div></div></span></span></div>Jim Connellhttp://www.blogger.com/profile/11784557733944049080noreply@blogger.com0