08/21/2012

MANAGING Your Retirement Income

Annuity Services

In addition to the immediate and deferred income annuities that we offer as part of our Income Portfolio Strategies in connection with our Income Management services, Retirement Income Center also offers annuities as part of our Asset Management services. Retirement Income Center's annuity services is part of a conservative, comprehensive systematic approach that we use to plan, manage, and protect our clients' retirement income.

Our management services include two types of services:  (a) Income Management and (b) Asset Management. Annuity services is one of the two types of asset management services we make available to our clients, the other one being investment advisory services.

We often recommend a combination of income and asset management services to provide greater diversification and better risk management than is generally the case with stand-alone investment advisory services offered by most Registered Investment Advisors (RIA's).

The primary purpose of the annuities that we recommend to our clients as part of our Asset Management services is to provide principal protection with a competitive fixed rate of return for a portion of our clients' portfolios. To the extent that nonretirement annuities are used, our clients will also benefit from tax-deferred growth that isn't available from other types of investments.

Recognizing that one size doesn't fit all, we recommend two types of asset management annuities to our clients when appropriate:  (a) deferred annuities and (b) fixed index annuities. Both offer planning opportunities not available from other types of investments. In exchange for these opportunities, both types of annuities are also subject to potential surrender charges and IRS premature distribution penalties.

Deferred Annuities

Deferred annuities are similar to certificates of deposit, or CD's. They offer a fixed rate of return for a fixed length of time. Unlike CD's, some multi-year deferred annuities add a bonus rate to the first-year rate.  

Unlike CD's which are generally offered by banks and insured by the FDIC up to a specified limit, deferred annuities are purchased from life insurance companies and are backed by the claims-paying ability of individual companies and state guaranty associations in the event of default of the insurance company.

Robert Klein, in his capacity as a life insurance agent, has at his disposal a wide variety of defered annuities from several top-rated life insurance companies offered by Crump Life Insurance Services, Bob's life insurance agency. The companies include, but aren't limited to, Allianz, Genworth, ING, Lincoln Financial Group, and New York Life. Multi-year guaranteed annuities are available for terms from three to ten years.

Fixed Index Annuities

 
Courtesy of Indexed Annuity Leadership Council
Louise Bridges isn't a client of Retirement Income Center.

An entire section of Retirement Income Center's website is devoted to a discussion of fixed index annuities, or "FIA's" in the context of their use as a deferred income portfolio strategy as part of the Income Management services offered by Retirement Income Center. Please see Fixed Index Annuities With Income Riders.

 As explained in this section, a fixed index annuity is a fixed annuity (vs. a variable annuity) that offers a minimum guaranteed interest rate and potential for higher earnings than traditional fixed annuities based on the performance of one or more stock market indices.

                See Fixed-Index Annuities as Bonds Alternative?

When appropriate, we recommend stand-alone FIA's, i.e., fixed index annuities without income riders, as part of an asset management solution for clients who are seeking a conservative approach for a portion of their portfolio that isn't available from other types of investments. Specificially, these clients are seeking the principal protection offered by fixed annuities together with the opportunity for appreciation that isn't available with deferred annuities.

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