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01-15-2014, 05:53 AM
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#21
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Quote:
Originally Posted by clifp
When/if interest rates rise, I'll consider buying a deferred annuity. Although in my case I don't think I'll have payments start before age 80.
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True interest rates suck at the moment. That's where TIAA-Traditional is different from many annuity products because it's interest rate tracks the prevailing long term rates with a guaranteed minimum of 3%. The pay out options also mean that you can make it into a true life time income annuity of arrange it to operate more like a very long term CD with access to your principal over a period of 10 years.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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02-06-2014, 10:25 PM
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#22
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Confused about dryer sheets
Join Date: Feb 2014
Location: Orange
Posts: 1
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Hi. I'm new to this website and seeking opinions on Annuities. I've ready many postings on several sub-forums on the site. I have found many interesting points. We are early 50s, and are in a financial position where we can start working part time. In the process of laying out a financial plan with a Fidelity Advisor, he is recommending using a portion of our IRA funds to purchase a Fixed Deferred Annuity with a 3% COLA. This Annuity would provide a low-risk future funding/income base. The annuity would start paying @ 65, about 12 years from now. The proposed Annuity would require ~27% of our current investible funds, which would then provide about a 42% of our future projected income needs on a yearly basis (all referenced to today's dollars - to keep apples-apples). The remaining income needs would amply be covered by the remaining investible funds and social security.
Please share your thoughts an opinions on this strategy.
Thanks, Phil
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02-06-2014, 10:29 PM
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#23
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gone traveling
Join Date: Nov 2013
Location: Los Angeles
Posts: 202
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Quote:
Originally Posted by Phil_1960
Hi. I'm new to this website and seeking opinions on Annuities. I've ready many postings on several sub-forums on the site. I have found many interesting points. We are early 50s, and are in a financial position where we can start working part time. In the process of laying out a financial plan with a Fidelity Advisor, he is recommending using a portion of our IRA funds to purchase a Fixed Deferred Annuity with a 3% COLA. This Annuity would provide a low-risk future funding/income base. The annuity would start paying @ 65, about 12 years from now. The proposed Annuity would require ~27% of our current investible funds, which would then provide about a 42% of our future projected income needs on a yearly basis (all referenced to today's dollars - to keep apples-apples). The remaining income needs would amply be covered by the remaining investible funds and social security.
Please share your thoughts an opinions on this strategy.
Thanks, Phil
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That "adviser" from Fidelty is a salesman -- Not a fiduciary. Legally that salesman does not work for you and your best interests even though it might appears that way. They are trying to sell you commission based products that pay themselves and Fidelity the highest commissions. Find a fiduciary fee-only registered investment adviser for a one time consultation.
Here's a quote from Forbes Magazine: "We don’t recommend an allocation to annuities for ANY portion of your portfolio. We believe an age-appropriate allocation to bonds provides a similar boost to the likelihood you will have sufficient assets in retirement."
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02-06-2014, 10:48 PM
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#24
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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I'd look into deferring SS before I bought the annuities that are on offer now. What are the expenses and payout rate of this deferred annuity. I guarantee that they will not be good.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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