Plan Today To Enjoy Tomorrow
Did you know if you retire at age 55, you could live another three decades? And you’ll need approximately 70% of your income to maintain your lifestyle. Are you prepared for such an eventuality?
Over the last 65 years, inflation has averaged 3.96%. For example, what costs you $10,000 today will cost you $21,743 in 20 years. To prepare yourself and your family for the future, you want growth without risk- and you want to safely outpace inflation. You want to take advantage of an upmarket… yet be protected during a down turn.
Our Indexed Annuity strategies give you stock market index linked gains without market risk, so your money has the potential to grow faster than inflation can “eat it”. We can help you live today so you can enjoy tomorrow, without putting you on an investment roller coaster.
Effects Of Inflation
Proper planning helps you overcome the effects of inflation. Over the last 30 years, the average annual inflation rate in the U.S. has been 5.48%* The information below shows how inflation can impact your personal economy:
Average Annual Inflation Rate – 5.48%
Number Of Years Ago – 10
Current Item Cost – $1,000
Past – Assuming an average annual inflation rate of 5.48%, that item which costs $1,000 today, cost $587 ten years ago.
Future – And that same item which costs $1,000 today, will cost $1,705 ten years from now.
* Source: U.S. Bureau of Labor Statistics, Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W); U.S. City Average by expenditure category and commodity service group. 1967-2010
People today are faced with the reality of a “new normal” for retirement. They must deal with the challenges the economy presents at the same time they take on greater responsibility for their own retirement security.
Research shows that the road to retirement satisfaction is paved with good health and financial well-being. In particular, retirees who finance their retirement with annuities tend to maintain higher levels of satisfaction over time than those drawing income from liquid savings. ACM can help provide the right annuity you need to make your income last.
Thinking about retiring and the financial situation you’re in doesn’t have to be an intimidating experience. As you prepare for retirement, it’s important to understand some key challenges that you and many other retirees may face. Creating a retirement income plan that’s right for you should be priority.
As you near or enter retirement, the impact of the risk of the financial markets on your retirement changes significantly. When you were saving for retirement, time was on your side and you could ride out the ups and down of the market. Time is no longer on your side as you start taking cash out of your nest egg. Market losses right before or as your begin retirement not only diminish years of smart saving, it can increase your risk that you will run out of retirement income. Simply stated, if market losses occur as you enter retirement or in the early years of retirement, the risk of running out of retirement income is much higher than if such losses occur later in retirement. This principle is known as the risk of the sequence of returns.
Over the course of a lifetime, IRA assets can potentially grow to a significant sum- sometimes even more than the owner can use during his or her retirement. If you would like to pass all or part of your IRA to your heirs, you may want to learn more about multi-generational or “stretch” IRA’s. Thanks to recent tax law changes, this strategy gives you the flexibility to extend an IRA’s tax-deferred status from one generation to the next, greatly enhancing the long-term growth potential of your legacy. To set up a multi-generational IRA, you name one or more young relatives as beneficiaries of the account. When you pass away, your beneficiaries can elect to take their share of the IRA distribution either in a lump sum or in increments spread over the course of their lifetimes. If they choose the second option, the bulk of the asset will continue to accumulate tax deferred even as they draw down income each year. The younger the beneficiary, the longer the asset may remain tax deferred, and the larger it can potentially become over time. Remember that regardless of instructions in your will, IRA assets will pass directly to the beneficiaries named on your account. If you die, without having named primary and secondary beneficiaries, your IRA assets will be paid out. And if these assets are use to pay your estate taxes, it subjects the funds immediately to income taxes as well. To help ensure that your money goes to the intended recipient, keep your beneficiary designations up to date. Setting up a stretch IRA may require some careful planning. Using this strategy appropriately, will create an opportunity to significantly increase the legacy you leave to your loved ones.
Understanding IRA rollover rules can help you better plan for the future. When you are dealing with retirement funds, you want to make sure that you handle the situation correctly. Otherwise, you could lose some of your retirement to unnecessary fees along the way. Here are a few things to know about IRA rollovers.
You are free to rollover your IRA funds from one custodian to the other. If you are unsatisfied with your current IRA custodian or want to transfer for other reasons, you are free to do so. However, you can only rollover funds from a particular IRA once per year. You can have the transaction go directly from one custodian to the other or you can handle it yourself. If you handle the transfer, you have 60 days to move the money to the new account. If the money is not deposited into the new account within 60 days, you will have to pay a 10% penalty on the entire amount and pay income taxes on the money for that particular year.
If you have a traditional IRA, you can also convert it to a Roth IRA. You will have to pay taxes on the money in your IRA and then file the necessary paperwork to convert to a Roth IRA.
As you approach retirement or change jobs we’ll help you understand Rollovers and all the steps necessary to set up IRA accounts. We’ll help rollover your 401k, 403b or other retirement plan. You’ll find valuable insight to make the rollover process simple.
One of the most common options is to roll over your 401k into an IRA. This is a great way to be in charge of your own investments while avoiding penalties and paying taxes at the present time. When you roll your money into an IRA, you are doing so tax free. You will not pay taxes until you begin to withdraw the money during your retirement years.
You also have the ability to roll over your funds into a Roth IRA. With this, you are going to pay taxes on the rollover amount, but when you begin to withdraw the money, it will be tax free.
When you choose a 401k rollover annuity, you can move the funds from your 401k account into an annuity with an insurance provider. With this type of retirement investment, you can realize several advantages over the other options in front of you.
1. Guaranteed Principal
One of the biggest advantages of this type of investment is that your principal will be guaranteed. With other types of investments such as stocks or mutual funds, you could lose your initial investment at any point. This provides some security when planning for retirement.
By choosing an annuity, you will have a lot of flexibility in your investment choices. You can put the money into a Fixed Annuity that gives you a fixed rate of return or you can choose from many investment choices such as mutual funds or stocks.
3. Income Protection
You can set up the annuity to provide you with a payment every month for the rest of your life. Once you retire, you will have a steady income waiting for you.
4. Death Benefit Protection
With many of the annuity products on the market, you can get death benefit protection. This provides your beneficiaries with money in the event of your death.