Published October 26, 2012
Most retirees are asking themselves the same question: Will I run out of money during my retirement years? One popular strategy is to apply the 4% rule—withdraw 4% of your initial retirement balance. Another rule of thumb is to spend only your portfolio’s interest and dividends. Some planners aren’t always fans of either strategy. This may work well with a strategy to leave money to heirs, but could easily put a crimp on your lifestyle. Retirees that are using this strategy of drawing fixed dollar amounts from a sinking portfolio will soon run into trouble, especially if your nest egg is still sitting in funds that are subject to market loss. Looking back on the last 10 years, that strategy with the average retiree wouldn’t have turned out so well.
There are strategies that can help make sure you will not outlive your money and still draw a comfortable amount at retirement. With these strategies, insurance companies will guarantee you that you will not outlive your money. Also, as you are withdrawing from your account each year, there’s one company that offers an increase in the percentages you are pulling out every year as you get older. Not to mention there’s zero risk! You keep any market gain, while you are protected from any market losses.
Face it. The market will decline at some point again in the future. Will your retirement be affected by it? If it’s in a place where it can be affected, you might want to rethink your strategies. With a big market drop, it can take 10 years or more just to recover any losses you may incur.
My opinion is to protect your investments to and through retirement with secure and conservative strategies. Fixed Index Annuities are one tool to provide these. Depending on which annuity is right for you, you can capture certain percentages of a major index during market gains, and when these indexes are down, there are no losses to your account. ZERO!
If you are looking for that retirement that you can’t outlive, there are companies that can grow your money anywhere from 4 to 7 percent compounded annually for up to 20 years or until you’re ready to draw an income. When you decide to retire and start drawing your income, it’s guaranteed for life! That’s right; you cannot outlive your retirement, no matter how old you live to be. So during these uncertain times we are facing, if you are looking for a safe, guaranteed retirement plan and peace of mind for yourself, we recommend a fixed indexed annuity. Take control of your future and stop speculating with the corruption and greed on Wall Street.
Call us today at Hebert Advisory Group or visit our website at www.HebertAdvisoryGroup.com for more information or a free consultation.