I would like to share with you a unique strategy to grow and access your money in retirement. It is called the accumulation-focused annuity strategy.

The “Accumulation Annuity” strategy, many people with qualified accounts such as a 401(k) and IRA will invest a portion of their future retirement dollars from their IRA or 401-k into an accumulation annuity. Your cash that you place in the accumulation annuity is invested in several external market indexes, such as S&P 500 index. Your money is only invested in the positive percentage return of the indexes you choose, not the actual index. This is why you can never lose money in an accumulation annuity due to market corrections. This is the money you want to build up over time so you’re going to have a lump sum of capital when you reach your retirement age. At some point, it’s going to be fully liquid. You’re going to have access to all this cash that you’ve accumulated during your working years. This money you’re going to start using in retirement. Most likely by taking systemic withdrawals, this income that you withdraw from your qualified account will help replace the income from your working years along with your social security.

The other portion of the qualified money that you have invested in stocks, bonds and mutual funds is at most risk to market volatility over the years. Because of the time horizon you have before your retirement, this money will experience higher rates of return since you won’t be touching this money for as long as 20 to 30 years. You will have years where the market is doing well, you are receiving those positive returns you’ve been looking for to build your accumulation value. But you will also experience down years, you will not only lose your positive earnings but possibly your principal that you paid over the years. There is no guarantee on that money. When you’re accessing the income, you don’t have any guarantees in place to make sure it’s going to last a lifetime.

That is why you should consider this smart money strategy of putting a portion of your money at risk in your qualified account into an accumulation annuity, which has no risk to principal or interest earning, it reduces the volatility to your overall qualified plan and puts in place a strategy of systematic withdrawals when the time arrives for your retirement. Using this strategy will allow you to choose where you withdraw your funds in your qualified account. In down market years, you draw money from your accumulation annuity which usually has no fees nor any losses due to market downturns. In positive years you draw money from the portion of your qualified money accounts (IRA or 401-k) that is invested in your stocks, bonds and mutual funds.

Using this strategy will allow your overall qualified account (IRA or 401-K) to last longer in retirement. To learn about the accumulation annuity and how it will benefit your retirement call Mel Samick at 888-839-3536.