Community Chat

[Mmsfoxxie]

Thanks, @millieshops.  No it is not money that I need to live, thank God, but I don't want to give it away.  I'm blessed to have pensions.

I'm gonna leave well enough alone.

[Bookbabe]

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@Mmsfoxxie wrote:

@Bookbabe, thanks for the response, especially your last paragraph which echoes a couple of other posters.

Question, though:  how is your fixed annuities having growth?  I was told that if I moved from my fixed into the indexed, I would either have growth or stay the save but never lose any money.

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You are correct in the index if you don't get any growth you will not lose any money. My annuities give me the option once a year to stay the same or move into a fixed account.  Since I am about to turn 72 about 4 or 5 years ago I started putting the money into the fixed getting about 4%, some getting 3.5%  I feel that is still good and certainly better than my saving account at my local credit union.  Since I have had most of these accounts for at least 10 years the minimum interest rate is still pretty good since this minimum feature was written in the original contract.   I actually have one annuity over 20 years which started at 9% with a minimum of 5%.  So I am getting 5% even now in this low interest climate.    I hope this helps.  I really hate thinking about this money stuff but since my husband died 4 years ago I have no choice.. 

[Bookbabe]

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@CelticCrafter wrote:

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@Mmsfoxxie wrote:

@Bookbabe, thanks for the response, especially your last paragraph which echoes a couple of other posters.

Question, though:  how is your fixed annuities having growth?  I was told that if I moved from my fixed into the indexed, I would either have growth or stay the save but never lose any money.

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We have a fixed rate and we get 6% a year - but it's 10 years old.  We can also add to it if we wanted to.

I don't know how true it is, but we were told by our FP that they don't sell those anymore - the kind you can add to.

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Those products are still out there but they sure don't offer your 6%.  You are one of the lucky ones.  I have one with a minimum of 5% and feel so lucky. 

[Mmsfoxxie]

Thanks, @Bookbabe for your words of wisdom.  I just never paid attention to this money.  Out of sight out of mine.  Now I realize that money sitting in a saving is dumb, too.  I think I was so thankful to have savings that I never thought as it was growing that I could get a better interest rate with a different type of account.  Sleep well.

[wilma]

I have had my annuity since I was 30.  I am now 50+.  I started it as a way to save money and get more interest than the banks offer.  My rate varies from year to year, but it will never go lower than a certain %.  I automatically have money deducted from my checking account each month and have it added to the annuity.  I have never taken anything out of it.  It will be additional income that I can use with my retirement $ and Social Security when I stop working.

[CalminHeart]

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@Financialgrl wrote:

My planner has the ability to offer annuities and has always advised against using them.  He says the only person who benefits from them is the insurance salesman that sells them to you bc annuities are basically insurance vehicles, and the commissions from them are pretty large.  Heard the concept behind them explained on a radio show one day and the question was posed - "if all other savings vehicles are making 1-2%, how do you think annuities can offer 7", then went on to explain it.  I forget the actual details behind it but when explained it made perfect sense.

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My parents' advisor also says that about annuities.  Having worked with annuities and advisors for 20 years, I find that appalling.   To automatically rule out a product means the advisor hasn't really considered the client's situation.  I've seen countless people benefit from annuities over the years.   There are so many types of annuity products.  Investment products should be tailored to each client's needs, not the advisor's personal desires.  

I'm retiring this year and wouldn't dream of putting my money in mutual funds or other securities whose value goes up and down every day based on how the stock market does.  How much risk would a retiree want to take?  (unless they're a billionaire)

By the way, commissions are higher for many other investment products....meaning they get paid better when selling products other than annuities.  

[CelticCrafter]

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@Bookbabe wrote:

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@CelticCrafter wrote:

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@Mmsfoxxie wrote:

@Bookbabe, thanks for the response, especially your last paragraph which echoes a couple of other posters.

Question, though:  how is your fixed annuities having growth?  I was told that if I moved from my fixed into the indexed, I would either have growth or stay the save but never lose any money.

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We have a fixed rate and we get 6% a year - but it's 10 years old.  We can also add to it if we wanted to.

I don't know how true it is, but we were told by our FP that they don't sell those anymore - the kind you can add to.

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Those products are still out there but they sure don't offer your 6%.  You are one of the lucky ones.  I have one with a minimum of 5% and feel so lucky. 

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I think I lied when I said ours was 10 years old, I'm thinking it's older because we've doubled our initial investment.
We are very conservative investors, so 6% is good with us and way better than any other kind of savings out there right now.

[meem120]

Dont tie up you money for 7 years at your age.  You never know what happens.  There are many kinds of annuites, get another opinion.  I have an annuity along with several other things in place.  I like it. It gives me peace of mind.  

[Mmsfoxxie]

@Nuttmeg.  Very interesting chart...thank you!  I've already cancelled my appointment, the main reason being my age.  I see by the chart that early withdrawal in the first year is 9%!  Unless you enter a nursing facility for at least 90 days.  Wow!