Survey after survey shows that the top concern for working Americans is running out of money in retirement. In fact, for those close to retirement, the fear of outliving their money is greater than their fear of death.
As a federal employee, your FERS annuity (pension), Thrift Savings Plan (TSP), and Social Security create an excellent foundation for a financially secure retirement. However, without careful planning you may find yourself running out of money when you need it the most: in your golden years.
Take A Hard Look At Your Budget & Make Changes Before You Retire
Once you’re retired and no longer working, living on a fixed income becomes a harsh reality. If you start to cut back your spending five to ten years before you retire, you can make lifestyle changes gradually over time. When you track every dollar you spend each month, you may be surprised to see some expenditures can be cut back or eliminated entirely.
Around Age 50, Look Into Purchasing Long-Term Care (LTC) Insurance.
A study cited by LongTermCare.gov indicates a person turning 65 today has a nearly 70% chance of needing some type of long-term care in the future. Yet, according to the National Council on Aging, 80% of adults over age 60 do not have the financial resources to cover the high out-of-pocket costs of long-term, custodial care in a facility. Without LTC Insurance, an extended stay in a nursing home could wipe out your TSP.
“If there’s a stock market downturn, you don’t lose money because fixed indexed annuities have no underlying investments.”
Consider Purchasing A Fixed Indexed Annuity
A Fixed Indexed Annuity is an insurance product that promises a guaranteed stream of retirement income for as long as you live while protecting your accumulated value against stock market volatility.
Also known as a Hybrid Annuity, it offers a minimum guaranteed return with an interest rate linked to the performance of an outside index such as the S&P 500. If your index performs well, the value of your annuity increases. If there’s a stock market downturn, you don’t lose money because fixed indexed annuities have no underlying investments. Other advantages of a Fixed Indexed Annuity include:
- Tax-Deferred Growth: earnings and interest accumulate tax-free until the money is withdrawn.
- Riders & Contract Provisions: a range of annuity riders can be added to your contract to address your needs – from death benefits to long-term care.
- Probate Free: an annuity enables you to leave a cash inheritance for your named beneficiaries and avoid the probate process.
Meet with an FRC® trained advisor to discuss more ways to maximize your retirement income.
