Fixed Indexed Annuity provides unique option for retirement
January 7, 2016 by Scott Jones
(Jan. 7, 2016) – Only about one in four retirees can say they’re confident they’ll have enough money through retirement. Building confidence in your decision making process is key.
“We provide a unique approach when it comes to retirement planning. While most financial advisors focus on the accumulation phase, we work to preserve and protect what our clients have spent a lifetime accumulating,” said Bill Demaree, who is known as“Your Retirement Guy.”
Demaree works in Indianapolis. He says their recommendations offer guarantees and provide protection against risk to a clients’ principal. One way to do that is steering clear of traditional investments as you get closer to retirement. He often recommends what is called a “Fixed Indexed Annuity.”
Basically you’re investing your money with an insurance company and getting back a fixed income from the principal you put in. Demaree set up the annuity for his client Don Murphy.
“We’re very pleased with our situation. We are investing in things where the yield is pretty steady and yet it can increase, but there’s less chance of it decreasing,” said Murphy, president of PPMI Firestop.
People can always buy into a Fixed Indexed Annuity at any age. But if your money is tied up in a current company’s 401k, you still may be able to move it, as you approach 60.
You need to check with your employer to see if there is a provision to move your money into a self-directed IRA. There are no customer fees. The broker gets a one-time fee from the insurance company.
“I feel when you get into retirement or close to retirement, it’s not appropriate to risk what you spent a lifetime to accumulate in equities. It’s not about the accumulation of your nest egg. It’s about the preservation and distribution of your nest egg,” said Demaree.
“We’re looking forward to retiring and doing the things we want to do. And we feel this is a good way to work towards that,” said Murphy.
There is a time commitment, depending on your plan. If you pull out the principal too soon, you’ll get penalized. If you keep it in longer, you can get bonuses.
