Preparing Your Finances for the New Year

With 2015 right around the corner, many people find December to be the ideal time to review their finances and retirement planning and make adjustments for the coming year. Financial professionals suggest that the end of the year is the right time for steps including:

  • Reviewing your emergency savings fund and cash flow planning for the upcoming year;
  • Rebalancing your investment accounts to make sure you’re meeting your financial goals; and
  • Making sure that you’ve funded your retirement accounts as planned for in 2014 and set goals for 2015. The IRS has adjusted the contribution limits for 401(k) and other retirement plans in 2015 – be sure to review the new limits and set your goals accordingly.

As you think about balancing your financial retirement portfolio, one tool to be sure to consider is a fixed indexed annuity (FIA), a financial product offered by life insurance companies. The advantages of FIAs include:

  • Peace of mind with a guarantee: Indexed annuities offer a guaranteed rate of return, along with the potential for additional interest credited based on an external index. Once interest is credited, it will compound annually and can never be lost.
  • Protection for your nest egg: Your premium and credited interest can never be lost due to index volatility. Your indexed annuity is a contract backed by the financial strength of the insurance company.
  • Tax-deferred growth: Like 401(k)s and traditional IRAs, FIAs offer tax deferral on your earnings. However, unlike 401(k)s and traditional IRAs, there is no government cap on contributions, allowing you to save more while enjoying tax-deferred growth potential.

Visit for more information about FIAs and consult with your financial professional to determine if a fixed indexed annuity is right for you.

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Fixed Indexed Annuity Riders Made Simple

Unsure if an FIA will fit your retirement plan? In the video Using Annuity Riders in Retirement, personal finance expert and author Laura Adams provides a simple explanation of FIAs and how optional riders can help safeguard your retirement savings.

The video includes easy-to-understand overviews of the following annuity riders:

  1. Nursing Home or Long-Term Care Riders, which allow you to access your annuity funds if you need long-term care either at home or in a nursing facility.
  2. Terminal Illness Riders, which allow you to access your annuity funds immediately without any fees or penalties if you become terminally ill.
  3. Lifetime Income Riders, which provide a guaranteed income stream from your annuity for your entire life.

Laura Adams is a personal finance expert, award-winning author, spokesperson, and host of the top-rated Money Girl podcast. For more information about using FIAs to manage health care costs in retirement, you can read Laura’s latest article on The Huffington Post.  

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Take Back Your Retirement: Begin Planning Now

Thanks to advances in health care and general well-being, Americans are living longer than ever. In fact, there are 11 states with more than a million people over the age of 651. And once people reach 65, men can expect to live another 19.3 years and women can expect to live another 21.6 years2.

Many older Americans dream of a relaxed retirement, spent travelling or visiting family or taking up a long-deferred hobby. But unfortunately, many aren’t able to do this because they haven’t been able to save enough for the increasing financial demands of retirement.

So instead of relaxing retirements, many older Americans are continuing to work. In fact, in a recent study 28.1 percent of Americans aged 60 and above said that their retirement plan was to “keep working as long as possible.”3

It is important to begin financial planning as soon as possible to ensure that you have a steady income that allows you to have the retirement you always dreamed of.  As you consider plans for ensuring a steady retirement income, one option to consider is a Fixed Index Annuity (FIA), an insurance product that pays you income, as part of a balanced portfolio and offers nest egg protection from market volatility.

An FIA will provide income options providing retirement income you can depend on for life. Unlike having funds in a retirement account such as a workplace 401(k) or an Individual Retirement Account (IRA), an FIA, with optional riders, can guarantee to give you an income stream that will last for your entire life.

To learn more about FIAs, be sure to watch this video: What Is a Fixed Indexed Annuity?

For more information on the data in this post, visit 1National Institute on Aging, 2US Social Security Administration, and the 3Board of Governors of the Federal Reserve.

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Tax Benefits of Using a Fixed Indexed Annuity in Your Retirement Plan

By: Laura Adams

Cutting your taxes every way that’s legally possible is a smart way to keep more of your hard-earned money. Additionally, paying less tax on the growth of your retirement savings allows you to keep every dollar invested, so you can grow a larger nest egg that generates plenty of income when you need it.

There are a variety of tax-deferred accounts that you might choose, such as a workplace 401(k), a traditional Individual Retirement Arrangement (IRA) or an annuity. Using these types of accounts can be a huge advantage when compared to investing through taxable vehicles, such as brokerage accounts, CDs and bonds that require you to pay tax on growth every year.

A fixed indexed annuity is an insurance product that pays you income in exchange for your premium payment(s) according to a contract. It allows you to enjoy potential growth that’s linked to a market index (such as the S&P 500), while protecting your savings from any downside loss.

You can use this calculator to compare the tax advantages of saving with an annuity versus a taxable account: What Are the Tax Advantages of an Annuity? (Calculator)

Here are 3 tax benefits you’ll enjoy when you add a fixed indexed annuity to your financial portfolio outside of a qualified retirement account:

Tax Benefit #1: Your interest growth is tax-deferred

With a fixed indexed annuity, your deposits into the account are not tax-deductible; however, you don’t owe tax on your interest earnings until you or your beneficiaries receive money from the account.

Tax deferral is a powerful benefit because the money in your account can grow even faster. When compounded over time, your total savings can increase, generating more income for you to enjoy in retirement.

Tax Benefit #2: No annual contribution limits

Retirement accounts, such as a workplace 401(k) and a traditional IRA, come with annual contribution limits set by the Internal Revenue Service. On the other hand, annuities don’t have any government-imposed contribution limits.

You can save as much as you want every year and enjoy higher potential amounts of tax-deferred growth with a fixed indexed annuity.

Tax Benefit #3: Annuitized payments aren’t fully taxed

One of the most common ways to take money from an annuity is through regular payments over your lifetime, known as annuitization. These payments are a combination of your principal and interest earned, which means a portion of your income stream (your principal) won’t be subject to tax during retirement.

In addition to these great tax benefits, you can also include one or more riders to a fixed indexed annuity for additional financial benefits and security. For instance, you can opt to have lifetime income, guaranteed payments to your heirs or coverage for long-term care.

Using a fixed indexed annuity gives you the flexibility to cut your taxes and accomplish multiple financial goals using just one product. To learn more, be sure to watch this video: What Is a Fixed Indexed Annuity?

See also: 5 Myths About Fixed Indexed Annuities You Should Ignore

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One Step At A Time: Retirement Planning Tips During National Save For Retirement Week


From October 19th – 25th people across the nation will participate in National Save for Retirement Week, raising awareness about the importance of retirement planning.

It’s a great time to think about your financial goals and take the steps to ensure you have your ideal retirement. With National Save for Retirement Week in mind, here are three tips for retirement planning:

  • Decide what you want: Whether you are 22 or 55, it’s important to have an idea of the retirement lifestyle you want. Do you want to spend time traveling, or relaxing with family? Describe your ideal and research how much that lifestyle will cost by the time you retire.
  • Decide how often and how much: Determine how much financial capital you will need during retirement based on your preferences. Once you determine how much you will need, figure out how much you need to save yearly, monthly, or even weekly, to meet your financial goals. Several workplaces offer retirement contribution plans and corporate matching. Research your options and ask how to sign up for your company’s available accounts.
  • Have a balanced financial portfolio: Financial experts agree that your portfolio should be diversified and include a variety of tools. For example, a fixed index annuity (FIA) protects your principal and provides a consistent income stream for life. It is tools such as these that you should consider for your portfolio.

If you need help, speak with a financial professional. They can help identify which financial tools, such as FIAs, are the best fit for your portfolio and retirement plan.

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5 Myths About Fixed Indexed Annuities You Should Ignore

By: Laura Adams

More myths swirl around annuities than any other financial product. Some of the confusion is due to the fact that annuities have changed over the years, offering more options and benefits than ever.

One of the most flexible types of annuities is a fixed indexed annuity (FIA). A FIA is a financial product that’s sold by insurance companies. The insurance company guarantees to protect your principal and give you the potential for growth linked to an index, such as the S&P 500. Plus, you can receive guaranteed lifetime income with a FIA

It’s important to understand the FIA facts as it relates to these 5 common myths:

Myth #1: If you have a retirement account you don’t need an annuity

Fact: One of the major benefits you can get from a fixed indexed annuity is the guarantee that you’ll never run out of money during retirement.

Having funds in a retirement account such as a workplace 401(k) or an Individual Retirement Account (IRA) is a terrific asset. However, those accounts don’t guarantee to give you an income stream that will last for your entire life.

Myth #2: All annuities charge high ongoing fees

Fact: The only time you’re charged a fee with a fixed indexed annuity is when you choose to add an optional policy rider.

For instance, if you choose a death benefit rider, which guarantees a payout to your beneficiary, or an income rider, which guarantees to pay you a set interest rate, you generally are charged a low fee in exchange for these benefits.

Myth #3: Annuities are too complex for the average person

Fact: An annuity is simply a contract you make with an insurance company get financial benefits in the future, such as during retirement. When you buy a fixed indexed annuity, you set aside some of your retirement savings in return for a future stream of income from that pool of money.

Myth #4: You always lose the balance of an annuity if you die

Fact: Fixed indexed annuities can allow you to pass the money in your annuity to one or more named beneficiaries after your death.

You can even choose to set up your annuity as “joint life” in order to provide you and your spouse guaranteed income for life, no matter how long each of you live. Another popular option is called a guaranteed return of premium, which insures that your beneficiaries receive the entire amount of money you put into the annuity.

Myth #5: Annuities are only for older investors

Fact: No matter your age, an annuity can be a smart way to diversify your financial portfolio.

Having a portion of your assets in a fixed indexed annuity can provide balance and stability for your retirement. Opting for guaranteed lifetime income gives you peace of mind that you’ll always have a dependable stream of income to depend on as you age.

Today’s fixed indexed annuities offer a range of benefits designed to protect your retirement savings from market loss, give you income for life and allow you to pass along money to your heirs.

To learn more about FIAs, be sure to watch this video: What Is a Fixed Indexed Annuity?

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Securing Your Retirement Version of ‘Happily Ever After’

Finances can make or break a relationship. Whether it’s deciding who picks up the check on the first date to who will pay the bills, it’s important to have an open conversation about finances with your partner. When it comes to planning for retirement, the earlier you have the conversation, the better.

Each of you might have your own idea of how to accumulate wealth for those later years. One might want to invest in the stock market; the other might want to put a little bit away in a 401(k).

Retirement saving preferences vary, but couples need to consider that they will be retiring together, and therefore must plan accordingly.  Avoiding the discussion will only cause more problems in the future. Newly retired individuals report the lowest marital satisfaction and highest number of conflicts compared with those who have been retired for a long time or those who are still employed, according to a 2013 Fidelity study.

Consider utilizing a Fixed Indexed Annuity, or FIA, to safeguard a portion of your retirement. An FIA can provide the stability of protecting your nest egg and still give you the opportunity to earn as the market rises. Your principal is protected and will never decline in value due to market downturn.

With FIAs, your money is only taxed at the time of distribution – not before – allowing it to grow tax deferred. The guaranteed income from an FIA could be used to supplement the lifestyle that your and your partner want in your later years – giving you both the peace of mind to enjoy your retirement together.

Learn more about FIAs here.

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IALC At FinCon14: Where Money and Media Meet

This week, the IALC will be heading to FinCon 2014 in New Orleans, LA. FinCon brings together journalists, bloggers and financial strategists to talk shop on financial planning, personal finance, investment, retirement and more.

We look forward to talking with media and money experts from across the U.S. about the benefits of considering a fixed indexed annuity as part of a balanced financial future. After all, we want everyone to have a chance to have a secure retirement future. Follow us on Twitter @IALCouncil throughout the event and participate in the conversation by sharing your dream retirement using the hashtag #DreamRetirement.

If you’re headed down to the Big Easy as well, be sure to stop by the IALC booth for more information on fixed indexed annuities, fun and a chance to win an iPad Mini!

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Employee Retirement Income Security Act Faces Scrutiny in a Changing Retirement Landscape

The Employee Retirement Income Security Act (ERISA) just marked its 40th birthday. It was with high hopes that President Gerald Ford, on Labor Day 1974, signed it into law as a consumer protection law. Today, after several amendments, ERISA sets standards of protection for participants in most pension and health plans in the private sector. A recent Pensions and Liability article on ERISA explored the 40-year history of the law that was supposed to protect consumers, but is now motivating employers to adopt retirement plans providing a less secure future for employees.

What’s the problem? ERISA has resulted in employers shying away from the investment risk of defined benefit plans and moving to defined contribution plans, like your 401(k), where employees bear the investment risk of their retirement futures.

Since defined contribution plans focus on retirement asset accumulation and not retirement income as defined benefit plans do, it is important that you take control of your retirement income plan. One important way you can do that is by considering a Fixed Index Annuity (FIA). An FIA allows you to set aside a principal amount that will remain protected in the event of a market downturn, with capped interest growth if the market rises. An FIA will protect your nest egg and give income options providing a retirement income you can depend on for life.

Visit our Smart Buyers Checklist to ensure you are asking the right questions when purchasing an annuity and preparing for your retirement.

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New Study Shows One-Third of Americans Have Zero Retirement Savings, Why?

When Americans imagine retirement, they think of the lifestyle shown on television filled with travel, golf, family and new adventures. Unfortunately, many Americans are unprepared financially to support that dream.

Thirty-six percent of people in the U.S. have no retirement savings, according to a recent study conducted by This includes 26 percent of adults between the ages of 50 and 64 – one of the most crucial age groups for retirement planning and saving. This generation acknowledges the importance of saving, with 32 percent of people feeling less comfortable with their overall savings than they were a year ago. So if they know they should be saving, why aren’t they?

Here are three reasons why many Americans don’t have enough saved:

  1. They do not know how much they need. As life expectancy continues to rise, more money is needed for retirement to cover basic costs. In addition, more money will be needed for health care as the population ages. Make sure you know how much you will need by using one of our retirement calculators.
  2. They are sandwiched: Many eager-to-retire Baby Boomers are part of the sandwich generation, which means they help support both their grown children and their parents.
  3. They were hit hard by the Great Recession: Many 50-64 year olds were dedicated savers, but the stock market crash and housing bubble impacted their lifetime savings. Many lost much of their savings in the stock market, which emphasizes the importance of having a diversified portfolio.

With the volatility of the stock market and less guaranteed employer income, the importance of having a diversified financial plan is more acute than ever. Fixed indexed annuities can play an important role in solidifying your retirement plan by offering peace of mind through guaranteed income. In addition to mitigating risk in down markets, fixed indexed annuities offer the opportunity to earn additional interest when the markets are doing well. Check out our video on the basics of fixed indexed annuities for more information on how this product can fit into your plan.

For more information about this retirement trend visit


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