So, you are on the doorstep of retirement, the point in your life where everything is supposed to be smooth sailing from here on out. The worries and stress of your professional career should fall by the wayside while you take the time to enjoy the finer things in life.
Unfortunately, this is not reality for many retirees.
Individuals who make smart, informed decisions, are the ones best able to enjoy retirement without the worry of money issues.
Lacking the proper strategy (even those with the best intentions) increases the likelihood of failure to reach financial goals, making the old phrase “people do not plan to fail, they fail to plan” extremely relevant.
As a new retiree, or someone nearing retirement, you need to develop a more conservative outlook with regard to investing, and adhere to the following rule-set:
- Favor protection against market loss
- Develop a steady stream of income for life
- Create a plan to ensure a predictable standard of living throughout retirement.
As for initial planning, it is essential that you take the time to become well versed in the options you have available. A smart place to start is to learn about the basics of annuities, a term that you will hear quite a bit during retirement.
Annuity – A financial contract providing payments over a specified period of time.
For retirees, this usually means recieving payments for the rest of your life. This sounds like an ideal situation….And it really is. Annuities are a great way for you to protect a portion of your saving from market loss, while ensuring your income lasts as long as you need it to.
Basically, annuities are the only form of investment that offers principal protection while providing income for life.
They can be fixed (pays out for a certain period of time) or variable (larger payments if the investment fund is creating higher returns; smaller if it is producing lower returns; but either way, you still get paid).
The varied ways in which these financial vehicles can be structured provide individuals the flexibility to develop an annuity contract that will best fulfill their needs.
One of the most popular options now is Fixed Indexed Annuities. These annuities have been very well received considering that there has yet to be one fixed income annuity that has lost their principal or profits from market volatility. This is very indicative of the careful planning and conservative execution enacted by those who offer these types of annuities.
Although annuities are a staple of every good retirement portfolio, a few other factors need to be taken into account when approaching retirement, such as:
- Constructing a well rounded portfolio
- Learning how to allocate your money into differing investment classes
- Knowing what to do with your 401k after retiring.
For the majority of us, knowing when and where to put your money can be very intimidating. If you are uncertain about how to go about planning for retirement, you must align yourself with financial advisors or companies that can help you in this process.
Finding those who can help you stay on a path of prosperity while shielding you from the volatility of the global markets is the surest way to stay insulated from the perils of investing, allowing you to focus on living your life. Karlan Tucker & Associates understand the current situation for most retirees and have developed their business around providing everything you need in order to realize your post-career dreams.