Annuities

Investing Can Be Risky….Maybe Not!

The current state of the world economy is about as volatile as it has ever been since WWII. Many investors have run to safety and made huge purchases in the only one really safe vehicle available-US Treasuries. Buying Treasuries is definitely a safe investment option….or is it? It is true that US Treasuries carry no risk, no risk in your investment being lost. However, there is another risk associated with investing in US Treasuries.

A Big Pile of Money: What is it Good For?

As kids almost all of us dreamed of being a millionaire I was raised in a small town in Idaho, we had one millionaire. People would always talk about her (yes, a her) about her cars, her vacations, her house and especially the Christmas party she always hosted. My parents went to the party every year; it was all so grand, at least by our small town’s standards. One year I got to park cars for the party and earned $20, a really huge payday for me. Now as I look back and wonder about being a millionaire I have realized that a big pile of money isn’t really an answer — it is what that pile of money can do that is important.

Bernanke and Broich — We have common ground.

I eagerly read about Federal Reserve Chairman Bernanke’s investments in annuities, I certainly agree with his decision. I too have the majority of our assets in annuities (not variable). Why is the real question. My answer is simple: because of the benefits annuities provide. Chairman Bernanke also must feel the same way as his major investment assets are annuities.

Tax Free Exchanges: Can I Move My Annuity Without Tax Liability?

If you use an IRS approved 1035 exchange you may exchange your contract for a new annuity contract within your current company or you can exchange your annuity contract for a new contract in a new company. If done properly, this exchange will not incur a tax liability, your deferred earned interest will remain deferred in the new contract.

Up Up and Away – Fixed Indexed Annuity Sales Skyrocketing

A recent industry watchdog report indicated an increase of over 25% in premium in 2012 and a forecast of another 30% increase in 2013. Growth is being driven by products offering access to a larger stream of income that would not be found with other investment options. Income for life that is both safe and secure seems to be the driving force.

The Bulls are Coming and it is Not Pamplona: It is Us.

A recent article from Lincoln Financial Group CEO Dennis R Glass reaffirms that a large and probably long bull run is coming to the annuity and life insurance business. “You now have a good, growing stock market and slowly rising interest rates – that has to be the best economic climate for the life insurance industry,” Glass said last week, speaking during a conference call with analysts.

Inflation and Fixed Indexed Annuities. Can You Protect Yourself?

Inflation is the rise over time in the price of goods and services. Is a loaf of bread higher than it as the year you were born? Inflation is measured as a annual percentage, the same way interest rates are measured as a annual percentage. Is inflation a bad thing? Not necessarily. It means prices are rising because demand is rising, so it is the result of a growing economy. In a healthy economy, wages rise at the same rate as prices. So in a healthy economy, inflation always rises, meaning the same dollar amount is worth less five years from now. Sounds pretty healthy, doesn’t it? Inflation hurts interest rates because lenders know the longer it takes you to repay the loan, the less the money is worth.

Can Changes be Made to Your Annuity After Death?

Rather than being bound by the terms of the original contract and current tax code, beneficiaries may be able to exchange inherited contracts for newer, higher interest paying contracts, according to the IRS under Private Letter Ruling (PLR) 201330016. This indication of change by the IRS can benefit the beneficiary because newer contracts can have lower costs, higher interest or better features such as policy riders. (income riders)

The National Debt: Will it Ever Be Paid? No!

The simple answer is this: it probably will never be repaid, it has been and probably always be part of our American heritage. The history of US Treasuries is fascinating story in and of itself. It began when our country began. US Treasuries go back to this country’s independence. The Revolutionary War was fought against Great Britain by the colonies as a united front but funded and manned by each individual state.

Mortgage Backed Securities — Round Two?

Private Equity Firms only know one thing, buy, dismantle, reap profits and move on. Their sites are set on our industry and they are coming. In fact, a few are already here, Athene, Guggenheim and others have already planted their flag. With the PE Firms will come new ways of doing things, new ways for Wall Street to invest in our products, things such as buying the investments side, slicing it up and reselling it to fixed interest investors. Who will win and who will lose?

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