When it feels like the world is spinning, it’s very important that you stay skeptical of promises of sure things. Is a simple and reliable investment really simple and reliable, or does it just appear that way in complicated times?
“As Russia launches its blitzkrieg against Ukraine, my inbox brimmed with reports from investment firms on what you should do next,” says Jason Zweig at the Wall Street Journal. Zweig goes on to say that Russia’s aggression has caused uncertainty that has raised rates in a way that “The U.S. economy may be too frail to withstand.”
Major indexes such as the S&P 500 may have recently recovered from the dip that happened along with the invasion of Ukraine. As a result, many are suddenly sure that it’s a safe time to invest. Oil prices are nearing $100 a barrel. However, there’s no predicting the changes in the market, because there’s no predicting changes in the geopolitical climate. As an example: Back in August of 2001, the Federal Open Market Committee stated that they’d be raising rates relatively soon. But then, after the September 11th terror attacks, the Fed dropped rates by 1.5 percent in less than two months. “Investors who overhaul their portfolios based on what the Fed seems likely to do could get stranded if it does something else entirely.” To, again, quote writer Jason Zweig.
Few Things are Certain
In recent months, many professional investors began redistributing their holdings. This was done in an attempt to cash in on rate changes by the Fed. Many expect these changes are inevitable to come. However, in uncertain times like these, it may be unwise to take aggressive risks.
Now that Russia has attacked Ukraine, emotions are running high. It may be tempting to make an investment that feels completely sure in order to provide stability. But hastily made decisions are often wrong. Maybe you’re going to try to reconstruct your portfolio to profit from a scenario based on predictions about the market due to current events. For example, a boom in the U.S. exports of natural gas, or higher military spending. The risk, though, is that those scenarios often don’t materialize. “And, even if they do, they can become too popular, eliminating the bargain prices that produce superior returns over time.” Says Jason Zweig and the Wall Street Journal. What if there was an alternative to stock market investments? Well, we may be able to offer one.
We May Be Able to Help
Zweig’s article goes on the suggest that while you shouldn’t make risky investments at this time, you shouldn’t overhaul your portfolio, either. However, we may have some information that could benefit you. Are you struggling to manage your investments right now? Are you unsure of how to keep your money safe? You aren’t alone. There are some products available, hover, that can get you income based on the growth of a stock market index, without directly investing in the stock market. Annuities, but specifically fixed indexed annuities (FIAs) are an option to consider.
An FIA, if you’re unaware, is a contract between yourself and an insurance company. First, you contribute a certain amount of money to the annuity. Then, an accumulation phase begins, during which that money increases based on the performance of an index. However, if a stock market dip occurs during this time, you aren’t at any risk of losing that money. Your principal amount is protected, backed by the issuing insurance company. It’s also worth noting that the accumulated interest is tax-free.* An FIA, being an insurance product, doesn’t apply to the same tax rules as other types of savings accounts.
Other benefits of FIAs include the income generated being tax-deferred, the option to select an income rider to compensate for inflation, and a death benefit that does not go through probate, and comes with a number of other benefits for your beneficiaries.
Safety is an important thing to look for when trying to save money for retirement and for your beneficiaries. This is even more so the case during uncertain times like these. Even if you believe a stock market investment is safe, you should put part of your money in safe alternatives.
Additionally, Some annuities are set up with bonus options. Some of these bonuses happen during the first 12-18 months. Others are set up to kick in after a certain number of years. The reason we bring this up is that right now, for a limited time, one of our annuity products is offering a 35% bonus. This means if you contributed $100,000 to your annuity, $35,000 would be added to your retirement and wealth benefit. If you purchase an annuity as a part of your retirement strategy, this could be an incredibly beneficial feature to you.
Are you looking for more information about this product, and how it may be able to help you? Safety and security are important qualities in a financial vehicle. Especially if you’re trying to save money for retirement, and especially during difficult and uncertain times. Reach out to us to learn more information. You can schedule an appointment, or attend one of our events where we talk more about FIAs and how they differ from stock market investments. We may have the key to your financial future.