By: John Campanola
Special to the Boca and Delray newspapers
The economic collapse of 2008 taught harsh lessons about the potential for portfolio losses and how that could derail one’s retirement plans. When there’s volatility in the market, it’s natural to worry about your retirement nest egg. Actions taken today can affect your financial security tomorrow, so let’s map out a strategy that includes guarantees that may help ease concerns despite fluctuations in the stock market.
Annuities can help.
When used correctly annuities can be powerful long-term retirement planning tools by helping to create an income stream for life. Annuity payments can be received monthly, quarterly, annually or in a lump sum, and have tax deferral benefits.
Variable annuities allow investors to potentially grow assets in the market, with the opportunity to add optional guarantee features for an additional fee that provide downside protection. Younger investors planning for retirement may be interested in the growth potential of a variable annuity. Some providers like New York Life offers certain variable annuities with an option called an accumulation benefit rider which provide principal protection over a chosen holding period. This means that at least the initial premium is guaranteed at the end of the holding period, helping to address volatility concerns.
Income annuities are known for their efficiency in generating guaranteed lifetime income. Other than a pension and Social Security, a guaranteed income annuity, can also produce a lifetime payment stream. It is like getting a “paycheck” for life. With a guaranteed income annuity, you can have peace of mind with the knowledge that you’ll have a steady retirement income to help with basic expenses in retirement, while weathering market volatility.
This educational third-party article is provided as a courtesy by John M. Campanola, Agent, New York Life Insurance Company and a Registered Representative of NYLIFE Securities LLC (member FINRA, SIPC), a Licensed Insurance Agency and a New York Life Company. To learn more about the information or topics discussed, please contact John M. Campanola at 561-642-5180, Registered Office located at 1300 Concord Terrace, Fifth Floor, Sunrise, Florida, 33323. Neither New York Life, nor its agents, provides tax, legal, or accounting advice. Please consult with your professional advisor for tax, legal or accounting advice.