The Retirement Annuity Finally Gets a Celebrity Sponsor - President Obama
The retirement annuity is just your basic survival essential in the whole retirement investment
scene. If right out of college, you know to look for a choice career and a fallback career, then heading right into retirement, you look for a choice retirement portfolio that will set you up for life and then you look for a fallback investment, that will let you survive. In America, the humble retirement annuity is what gives you that fallback position. Something that gives you a reasonable if basic income through your golden years. It used to be called your corporate pension; but ever since that dream evaporated, and Social Security stopped being anything close to survival money, it falls to you, to set up a retirement annuity that's large enough to be the buffer you need when there is no more fresh income coming in for 30 years. And now, the annuity has turned into President Obama's fallback for a retirement policy for America too.
President Obama's plan is for everyone to plan for a really basic retirement annuity investment. Just a pile of cash parked in a good plan. And this option appears repeatedly in the middle-class task force reports that the government just put out. Perhaps the appeal in this single-premium insurance policy-for-life lies in how simple it is. There are other options out there, that involve too much expert user knowledge. We have all heard of it; when the insurance salesman starts pitching those unnecessarily complicated variable annuities we all know where to run. But even the government doesn't like complicated plans; there is warning after warning that the government puts out to help people considering these things.
You don't have to actually go out and buy one independently; lots of corporations offer them to anyone on their staff who is on the verge of retiring. Hardly one in a hundred actually bites though. The reason no one likes it is, that while you are indeed guaranteed, say $1000 for life if you invest $150,000 in a retirement annuity, once you check out, that money is gone. You cannot leave anything of that to your children or grandchildren. And getting your money's worth, will require that you live for 15 years past the day you retire. And you need to live longer still to make a profit. You do get to leave your retirement annuity to your spouse after you pass on, but for that privilege, you will have to accept lower monthly payments. Basically, the whole retirement annuity concept is all about paying them a lot of money to get a little money every month in return. And no one likes it. Not even other financial planners like it. If you go and park your money in a retirement annuity, the share brokers, the investment planners, they get nothing to invest for you and earn a fee off.
The very mention that such a product is being promoted by the government sends insurance companies into shivers of excitement. This product that they have been unsuccessfully trying to sell for ages, is suddenly the darling of the government's retirement action plan. The government has been trying to offer tax incentives to people who pick a retirement annuity. Having the government throw its weight behind such a plan is certainly useful. The concept just needs a basic push to gain a little bit of initial traction. Once people realize how useful this is as a way to stay well-paid for ever, once people get to see enough friends succeed at it, the retirement annuity will start to get a little more love.
The retirement annuity is just your basic survival essential in the whole retirement investment
scene. If right out of college, you know to look for a choice career and a fallback career, then heading right into retirement, you look for a choice retirement portfolio that will set you up for life and then you look for a fallback investment, that will let you survive. In America, the humble retirement annuity is what gives you that fallback position. Something that gives you a reasonable if basic income through your golden years. It used to be called your corporate pension; but ever since that dream evaporated, and Social Security stopped being anything close to survival money, it falls to you, to set up a retirement annuity that's large enough to be the buffer you need when there is no more fresh income coming in for 30 years. And now, the annuity has turned into President Obama's fallback for a retirement policy for America too.
President Obama's plan is for everyone to plan for a really basic retirement annuity investment. Just a pile of cash parked in a good plan. And this option appears repeatedly in the middle-class task force reports that the government just put out. Perhaps the appeal in this single-premium insurance policy-for-life lies in how simple it is. There are other options out there, that involve too much expert user knowledge. We have all heard of it; when the insurance salesman starts pitching those unnecessarily complicated variable annuities we all know where to run. But even the government doesn't like complicated plans; there is warning after warning that the government puts out to help people considering these things.
You don't have to actually go out and buy one independently; lots of corporations offer them to anyone on their staff who is on the verge of retiring. Hardly one in a hundred actually bites though. The reason no one likes it is, that while you are indeed guaranteed, say $1000 for life if you invest $150,000 in a retirement annuity, once you check out, that money is gone. You cannot leave anything of that to your children or grandchildren. And getting your money's worth, will require that you live for 15 years past the day you retire. And you need to live longer still to make a profit. You do get to leave your retirement annuity to your spouse after you pass on, but for that privilege, you will have to accept lower monthly payments. Basically, the whole retirement annuity concept is all about paying them a lot of money to get a little money every month in return. And no one likes it. Not even other financial planners like it. If you go and park your money in a retirement annuity, the share brokers, the investment planners, they get nothing to invest for you and earn a fee off.
The very mention that such a product is being promoted by the government sends insurance companies into shivers of excitement. This product that they have been unsuccessfully trying to sell for ages, is suddenly the darling of the government's retirement action plan. The government has been trying to offer tax incentives to people who pick a retirement annuity. Having the government throw its weight behind such a plan is certainly useful. The concept just needs a basic push to gain a little bit of initial traction. Once people realize how useful this is as a way to stay well-paid for ever, once people get to see enough friends succeed at it, the retirement annuity will start to get a little more love.