You won’t believe how annuity plans have completely changed!

I want to ask you a personal question. When was the last time you thought about your Retirement?

I’m not trying to embarrass you or embarrass you. And I’m certainly not trying to fool you. But, in reality, we are experiencing a retirement crisis.

Before you assume I’m exaggerating here, the Federal Reserve Report found that about 38% of people between the ages of 18 and 29 have nothing in retirement savings. And that’s also true for 27% of people between the ages of 30 and 44.

Before joining Gen Z and Millennials, 17% of the 45-59 age group have nothing set aside for retirement. What about those over 60? Well, 12% of people in this demographic also lack a retirement cushion.

even if you do If you have a retirement plan, such as a 401(k) from your employer, or a self-employment option, such as a Solo 401(k) or SEP IRA, that alone probably won’t reduce you in terms of living income. Instead, you’ll need several different retirement savings vehicles if you want to reach your retirement destination. And, one of the most attractive retirement plans to consider is an annuity.

Let’s talk about annuities

A few years ago, TIAA, who describes himself as a unique financial partner, posed an interesting question in his “Lifetime Income Survey.” Would you rather receive a lump sum of $500,000 or $2,700/month for life? Sixty-two of the respondents were with the monthly income?

But why? I mean, half a million dollars in cold, cold cash sounds like a good deal to me.

“A steady stream of retirement income helps cover your expenses, no matter how long your retirement is,” said Ron Pressman, executive director of TIAA Institutional Financial Services. “Lifetime income helps ensure Americans have the financial security they need in their retirement years – it’s not a ‘nice’ thing, it’s an absolute necessity.”

The survey also showed that an overwhelming percentage of people, 71% to be exact, “support legislation to make it easier for employer-based retirement plans to include lifetime income products, such as annuities, as investment options.” “. And, 67% “are in favor of legislation that requires retirement account statements to include an estimate of monthly retirement income.”

That’s all well and good, but what exactly is an annuity?

Good question. Short answer? They are a contract between you and an insurance company. You give money to said insurance company and they will invest it for you. In return, you will be guaranteed a retirement income for the rest of your life.

The interesting thing about annuities is that they have been around for thousands of years, dating back to ancient Rome. It wasn’t until the early 20th century that the American public was able to join in on the annuity fun.

Annuities sound pretty simple to me. How can I make it part of my retirement strategy?

Let’s cool the jets real fast. I’m glad you want to get on board. But, annuities are simple and complex. They come in various shapes and sizes. And, depending on the type of annuity you choose and how much you’re investing, payments will fluctuate, too.

So here is a brief summary of how annuities work.

You have two different types of annuities to choose from. A fixed annuity is more or less a savings account with an insurance company where you know exactly what your guaranteed payment will be. A variable annuity is more like mutual funds and is determined by the performance of your investments.

Still with me? Good. Because there are also different ways you can put together your annuity. It’s like when you want your barista to customize your latte.

• Single premiums vs. multiple: How do you want to pay the annuity? You can make one large payment, as if you had just received an inheritance, or make smaller payments over the years.
• immediate vs. Deferred: When do you want to receive payments? Inheritances, or making smaller payments over the years. You cash in everything when you retire or practice self-gratification and get paid in advance.
• For life vs. fixed period: How long will your annuity payments last? Do you want to receive money for the rest of your life or for a specific period of time, such as 5 to 25 years?

In general, annuities require a commitment and can quickly become very complicated. That’s why you should do your due diligence and find out more about them from trusted sources online or from your financial advisor.

Sounds good. But are there drawbacks to annuities.

Let’s be honest. Annuities have some great advantages, depending on the type. Primarily, that’s because you’ll receive a guaranteed income, which is tax-deferred. Also, unlike a 401(k) or IRA, those aren’t contribution limits and you can pass what’s left over to a beneficiary.

There are also some drawbacks to mention. In particular, you’ll need to watch that you don’t get bogged down with fees. I mean commissions from the person selling you the annuity to insurance charges and investment management fees. There are also delivery and passenger charges if you’re not paying attention.

In addition to being expensive, it also involves some risk. Since annuities are not backed by any national insurance program, if you chose the wrong insurer, it could be SOL. That’s why you need to make sure the insurer has a financial strength rating of A or better.

I think I’m sold on annuities. But should you really buy an annuity?

You will not like this answer. It depends. If you’ve maxed out your other retirement investment methods, like 401(k) plans and IRAs, then taking advantage of an annuity’s tax-deferred growth isn’t a bad idea.

Also, annuities can be a great idea if you want to diversify your retirement portfolio, are in good health, and want to reduce financial stress in retirement. Again, the main selling point is that you will receive one monthly payment for the rest of your life. That makes budgeting much easier.

If you decide to go ahead, you can buy annuities from;

• Distributors of life annuities. I’m talking about big brokerage firms here, think Merrill Lynch and Morgan Stanley.
• Independent stockbrokers, like Raymond James.
• National banks known as Bank of America.
• Mutual fund companies, including Vanguard and T. Rowe Price.
• Independent agents, brokers and financial advisors.

And there is also a new player called Due who could have increased the annuity.

How Due is changing the annuity game forever

What’s that? You’ve never heard of Due. Well, the company has been around since 2015. Originally, Due was solely focused on being a top-tier billing platform. The company still offers a wide range of payment options, including eCash, eCheck, and ACH, but has now expanded into an annuity- and pension-like program to help people like you retire.

Can Due help my head stop spinning from all this annuity talk?

I hear you. Annuities can be confusing. And, if you’re in unfamiliar territory here, it can be hard to figure out.

But that’s not the case with Due. In fact, he would say that Due might have cracked “the annuity puzzle.”

The annuity puzzle?

Yes. This was a sentence that the economist menahem yaari minted over 60 years ago. The idea is that while more retirees would prefer and even be happier with an annuity, few did. There are several reasons for this. But, it really comes down to annuities being complex and poorly understood.

With Due, the process couldn’t be easier.

• Head over to Due.com and click sign up.
• Fill out the required information and determine how much money you would like to deposit into your account each month. It literally only takes a couple of minutes to do this.
• Don’t know how much to invest? No problem. The expiration calculator can help you solve this quickly. Just add the sum of all payments and interest received. Then, divide this by the months you will live. However, you can invest as much as you want.
• Due will then set up an account in your name and invest your money. It is managed by two of the country’s leading investment firms: Blackstone (NYSE: BX) and ATHOS Private Wealth.
• You will earn 3% interest (guaranteed) on any money you have placed on the Due platform.
• When you turn 65, you’ll receive a “deposit” into your bank account on the 1st or 15th of every month; you can choose the date.

That is practically all. Easy peasy.

Due Annuity sounds too good to be true? What’s the trick?

There is no BS with Due. The platform tells you how much money you will receive for the rest of your life at any given time. And you don’t have to lose sleep over changing markets because, again, you’ll always earn 3% interest.

You also don’t need to worry about security. Due has received regulatory certifications and only works with highly reputable insurance companies that have A++ or AAA ratings.

What about those expensive annuity fees you mentioned earlier?

Fees due $10/mo. That’s all. If you make a withdrawal before 65, you will have to pay a penalty of 10%.

Speaking of withdrawals, what if I need to withdraw my money?

No problem. You can do this simply by logging into your account and requesting a withdrawal. After verification, you should have your money within five business days. Just remember that 10% penalty.

Sounds like Due is the “annuity for the modern person.”

Really is. Due has eliminated the complexity of annuities. More importantly, it also made it accessible to the average person, not just the rich who’ve been gobbling up annuities.

If you think an annuity is right for you, give Due a try.

The charge Annuity plans will never be the same first appeared in Earring.