quote:
They have tax advantages, but not I'm a fan unless you're within less than 10 years of retirement. I'm not investing in them until after maxing out my ROTH and SEPP IRA's, it's just not worth tying up my money for mediocre returns.

I'm an anxious guy and the guaranteed income for life rider costs 0.65% of the principle per year. Even with the fixed annuities mediocre returns in good years, it seems attractive as I have no pension. Like I mentioned I've got a 401k going and some other IRA's as well as mutual funds and individual stocks that are not part of an IRA, but when the market takes a dump like 2008/9 and 2000, I take it in the shorts.

I'm 41 and I guess I just want some of my retirement income guaranteed. I've been investing since 1998 and have gone through two crappy periods and don't feel as though I've gotten as far as i'd like.

Are there loopholes and/or tricks the insurance company includes in these contracts that can screw me in the long run? What happens if the insurance company goes out of business ten years into my annuity?

Thanks.

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Posted by BARNEYSTINSON

Member since Oct 2011

773 posts

Posted on 1/17/13 at 8:48 pm to Jake88

At 41 the income rider is probably not necessary. Especially since the annualised caps are so low right now. Considering your age and risk tolerance an indexed annuity could definitely be utilized as part of your retirement buckets. If income is your primary goal for these funds, you may want to look further in to a variable annuity. It will give you a better potential for growth and still guarantee to a lifetime income. Especially considering your time horizon. I would also look at low cost conservative allocation funds that are tactical. You may also want to look in to alternative investments that are not correlated to the equity/bond markets.

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