With interest rates near 20 year highs, wouldn’t it be great if you could lock-in these high rates for the rest of your life?
Luckily for you, there is a way to do that and that’s through purchasing a guaranteed lifetime income product.
By locking in rates today, you could get income payouts as high as 10%-13% for the rest of your life starting when you retire like John and Sally*.
John and Sally are both age 55 and are high income earners in California. They plan to retire in 10 years and want to defer paying taxes on their investment gains until they are in retirement and in a lower tax bracket. They see that interest rates are high now and want to lock in these rates for the rest of their life.
They decide to purchase a guaranteed lifetime income annuity product that will pay them 13% of their initial investment for the rest of their life.
John and Sally decide to invest $1 million today, so that at age 65, they can receive a $130,000 payout every year as long as one of them is still alive! That’s a 13% payout for the rest of their life!
Below are the top 4 reasons you should consider purchasing a guaranteed lifetime income product today:
1. Locking in today’s high interest rates for the rest of your life
Guaranteed lifetime income products base their payouts on current interest rates. If interest rates are high today, they allow you to lock-in those rates for the rest of your life.
If you wait to buy a guaranteed lifetime income product in the future, after interest rates have decreased, your payout rates will be lower.
So purchasing a guaranteed lifetime income product today allows you to lock-in today’s high rates!
2. You’re currently in a high tax-bracket and plan on retiring in the future and being in a lower tax-bracket
Purchasing a guaranteed lifetime income product today allows you the ability to wait to receive income until after you retire and are in a lower tax-bracket. That way you get to keep significantly more of the income you receive without losing it to taxes.
On top of that, when you receive the income not all of it will be taxable!
This is an extra benefit that guaranteed lifetime income products offer to clients.
3. You’re wealthy/ or are in good health
Wealthy individuals have better access to healthcare and live longer than people with less wealth. This means that by buying a guaranteed lifetime income product today wealthy individuals will on average receive significantly more guaranteed lifetime income payouts than their less wealthy counterparts.
Similarly if you’re in great health, you are more likely to live longer than someone in poor health. As a result, you would receive more guaranteed lifetime income payouts than someone who is in poor health.
4. You don’t want to sell your existing investments to meet your retirement income goals
If you have an existing investment portfolio that is doing well, you might not want to sell those investments to provide retirement income for yourself. Selling those investments would mean you would pay taxes on the gains as well as losing any future growth of those investments.
Purchasing a guaranteed lifetime income product allows you to use that tax-efficient income stream to meet your retirement income goals while allowing your existing investments to continue to grow tax-efficiently.
To learn more about Guaranteed Lifetime Income