THE REAL COST OF SAFETY IN CDS?

Written by Joseph Thomas, author of "The Retirement Know-It-All"

Interest rates are low

Interest rates are low, We all know that! So what are you doing with your money in low-interest accounts? If you ask most people with CDs, they will tell you, “It’s for safety!” But how much is that safety costing you? It’s costing you money, Lots of Money!
Let’s get this straight: I am not telling you to go out and buy risky investments like stocks, bonds or mutual funds. I do not sell these products! Instead, think about the safety and bet¬ter returns of fixed annuities or fixed index annuities. Whatever you have heard about annui¬ties is likely dead wrong, and I will prove it.

SHOULD I LIKE ANNUITIES?

Why do I like annuities? The question you should be asking is, “Why should I like annui¬ties?” Simply because they are safe, and their returns have been better than CDs for years! And interest rates are not going up anytime soon, no matter what you hear on TV!
The government has forced American seniors and conservative investors to either invest in the stock market or continue to keep investing in low-bearing accounts such as CDs. But the equilibrium is in annuities because of their safety and returns. What are you giving up by investing in ANY other investment than a CD? Not much. CDs range from .25% to 1%, whereas fixed annuities range from 2% for a 3-year fixed to as high as 3.75% for a 5-year fixed rate, with indexed annuities offering even better growth opportunities ranging from 5% to 7%. So why would you keep your money in CDs or low-interest account?

EMERGENCY FUNDS?

Many clients also tell me that they have their money in CDs or low-interest bank accounts in case there is an emergency. But what emergency costs $100,000? My clients say they don’t know. I tell them, “You have a family member in prison in a foreign country held for ransom?” This view of safety is unrealistic!

BUT ARE ANNUITIES INSURED?

Some people think CDs have $250,000 FDIC and annuities do not. But that’s not true! An¬nuities have $250,000 or more of Guaranty Insurance Association Protection if an insurance company should have financial difficulties.

WHAT DO ANNUITIES PAY?

Fixed annuities with a five-year fixed contract are paying approximately 3% fixed rates. You can defer your taxes by letting your money accumulate, or you can take the interest as income. That’s up to you. Index annuities are different and more complex, but most of my clients average anywhere from 5% to 7% each year over the past 10 years. Now this is not guaranteed, and the rates fluctuate from year to year. But in my experience, they do very well as compared to CDs. And you have zero risk!

WHAT ABOUT SURRENDER CHARGES? CAN I ACCESS MY MONEY?

The biggest question I get about annuities is, “What are the surrender charges?” That’s the best question a client can ask me. Surrender charges generally run from 3 to 10 years de¬pending on the annuity and can be as high as 10% if you cash in your annuity. However, if you buy a five-year fixed annuity, you will have 100% of your principal and interest avail¬able at the end of five years, just as you would if you purchased a five-year CD.
Some annuities I offer even come with checkbooks in case you need to access your money. They also have full access should you go into a nursing home or have a medical emergency. They also offer 10% Free Withdrawal every 12 months should you have a need for cash.

WHY SHOULD I DEAL WITH YOU?

I represent you, the client. I am independent and can shop many different companies and find a product that suits your needs — not mine.
A client told me that a friend had NY Life and that “they pay the best.” I told the client that was not true because each product is different and each company may pay more or less than another one. So I ran a proposal of the top 30 income-paying annuities, and NY Life was number 10 — not even close to the top 3.
The real cost of safety with your CDs is YOU not knowing that there are safe alternatives with extremely high levels of safety equal to if not surpassing that of a CD, with rates gener¬ally higher than any bank investment.

WHAT DO I DO NOW?

Don’t look for excuses! Look for better rates that can fulfill your needs with the same level of safety. And that solution is fixed annuities.
Call me! Spend 30 minutes on the phone in the comfort of your home with zero pressure and ask me every question about annuities you want to know without obligation!
Call Joe Thomas at 561-743-0999 if you have a CD, IRA, savings account, or older annu¬ity and find out how to protect and make your money last longer than any other product.