When thinking about Social Security and the uncertainty of the future of it, most of us are thinking about ways to put back enough money in order not to have to depend on Social Security in Retirement. Many of us have invested in our company’s 401k, 403b, etc. When you leave the company it is wise to roll the monies over into a retirement vehicle. Annuities are a very safe investment. In an Annuity purchased through an Insurance Company you are able to take advantage of the upside of the market, and have a safety net from the downside of the market.
Others who don’t have the benefit of working for a company that offers 401k’s still need a safe investment vehicle for retirement. With bank and credit union CD’s having such low interest rates, an annuity is a good choice. You can either purchase a single premium annuity, or annuities that can be added to in order to increase your retirement nest egg.
You can roll IRA’s, 401k’s, etc. into tax deferred annuities which will boost your retirement savings, allowing your retirement to grow tax deferred until you reach 70 ½ at which time you will begin to draw RMD’s, Required Minimum Distributions.
Most Annuities allow for tax deferred withdrawals on an annual basis, giving you access to a portion of your money each year. However, if you have to access any of your money before 69 ½ you may be subject to an IRS penalty unless you have an approvable hardship.
There are fixed, Indexed, and variable annuities. Insurance Companies only offer fixed and indexed annuities, both of which the contract value will be no less than a specified minimum. It is a contract between you and an insurance company that is designed to help you meet retirement and other long-range goals, under which you make a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments to you beginning immediately or at some future date.
How Well have you planned for Retirement?
It's never too early or too late. If you have 401k's or 403b's, etc. you might want to consider rolling them over into into one Annuity for Security purposes. Also, if you have money in CD's, the interest rate is so low, you might want to move a portion of it into an annuity for a short term in order to increase your rate of return.