I want to review three common annuity regrets. Then at the end, I’m going to tell you about a bonus. This is a benefit that you probably wouldn’t be aware of or even think about.
Disappointment Looking Back
The number one regret is looking back when you have a fixed indexed annuity. Years down the road, you may think “I wish I would have left my money in the stocks that I had. I would have way more money today.” Stock market returns of 35, 30, 22 or even 17% may occur especially after a long bull run.
You may have regret thinking, “man, I could have earned so much more if I had just left my money in the stock market.” Well, if you are thinking that, then you are not a good candidate for an annuity. The annuity gives you protection. For that reason, the annuity is not able to get all the upside of the stock market. The annuity protects you from any type of significant downturn in the stock market. It is able to get a benefit as the market goes up. However, if the stock market goes down, you lose nothing. That is the benefit of the fixed indexed annuity.
I Wish I Would Have Put More
The second regret is just the opposite. “I wish I would have put more into the fixed indexed annuity.” The stock market went down and dropped significantly. My friends are talking about all the money that they lost. I’m thinking, “I’m glad I didn’t lose that. I wish I would have moved more money over to the fixed indexed annuity. It would have protected more of my retirement assets. I would have controlled more of the downside of my retirement assets.” But that’s the irony, right?
With the first regret, I would have gotten more money by staying in the stock market instead of having an annuity. With the second regret, I would have made more by having more in the safe and protected fixed indexed annuity.
Know What You’re Signing Up For
The third regret is, “I wish I would have known more about my contract.” This is the biggest regret that really causes people to be the most disappointed. It’s tough finding out your contract did this, but it didn’t do that. Then you hear later there were programs with benefits that you don’t have in yours. You could have liquidity issues and not able to take out as much money as you thought. Or, something changed and you weren’t able to take out as much money as you thought.
Bonus: Annuity Optimizing
Here is the bonus: You can get some annuities that are optimized for income. This maximizes the income based on your age and a few other factors. You can get some annuities that are optimized for liquidity. This means you are able to take out as much money as possible. There are a number of qualifying events that allow you to take out even more.
Annuities optimized for life-changing events.
In the event something unforeseen happens, you have all this freedom to be able to take out money. A death benefit is another area to be optimized. You can have an annuity that is just set up primarily to be able to grow for a spousal benefit or it can be passed to the next generation in a tax benefit. It can be set up in a way that gives you the best tax advantage that’s possible. These are just a few ways annuities can be optimized for your particular case.
A number of things also come into consideration. Do you want to be able to take it out over time? How do you manage income tax after you pass away? Your age, your health, your spousal situation, your family situation, and your income position are all factors to examine. There are so many things to think about.
Ask More Questions
The way you’re able to benefit from this is to ask questions. You ask specific questions and I will give you specific answers. Remember, our number one objective is to improve your retirement experience. We want to be generous with the information that we are giving you so you are able to make a great decision. We want you to be able to retire happily ever after.