One Million Dollars Only

Why annuities is one of the best plans for your retirement?

Annuities can be one of the best ways to plan and create financial security for your retirement. Annuities have become one of the most sought after investment options for almost-retiring people all over the world. Annuity can be described as a arrangement whereby the annuitant (the retiree or individual taking up annuity investment) makes a number of agreed payments into the annuity-providing institution and the institution invests such monthly contribution into many high yielding businesses which will guaranty a lifetime monthly income for the annuitant.

Annuities can work for your retirement when you start making your contributions early enough- at least 1-5 years of continuous contribution is advisable so that your lifetime contribution will be guaranteed.  Annuities generate fixed income for a lifetime and for some types of annuities such as the fixed-return annuities the annuitant doesn’t even have to be bothered about the performance of the investments because the best of investment options are involved hence risks of losing your money has been drastically reduced.

Annuities can work for your retirement in so many ways. Apart from giving you the opportunity to receive a continuous lifetime income, the generations after will continue to receive such benefits long after you have gone.  With the annuity system of investment, all you need to do is to cash your annuity checks and be rest assured that the financial institution or insurance company offering the annuity investment will bear all the risks associated with such investments.

Joint annuity is the investment plan in which the spouse of an annuitant receives the benefits on behalf of the annuitant in case of a permanent disability or death. This kind of arrangement serves as a form of life insurance for the survivors of the annuitant. Annuity premium are often paid in different ways but lumpsum payments are more common. It can also be paid in smaller units over a period of time. Annuities can work for your retirement only if you are prudent enough to invest and make money for the rest of your life.

The advantage of receiving a lumpsum premium is the fact that such premiums yield more interest as they remain part of the investment . The more the money stays in the pool of investment the more money made. Most people prefer the lumpsum payment especially when they have a huge project to deal with.

Annuity returns are classified into two which are; Fixed annuity returns and Variable return annuities. Fixed annuity returns is the one that attracts fixed and continuous streams of income. Variable return annuities is different from fixed annuity returns in that the yield or returns paid to the annuitant will depend on a number of factors especially the  performance of the investment of the annuity among other factors.

To get the best annuity that will work for your retirement, it will be ideal for you to get price quote comparison online or at any of the financial institution or insurance company where you want to invest.

How much is one million dollars worth nowadays?

Actually how much is one million dollars worth nowadays? And with that, I mean how much is one million Benjamins or US dollars worth anyway? With prices of goods, services, properties and even basic amenities rising faster than our wages, that one million dollars that we so desire may not be worth as much as during our grandfathers’ time, when having a million dollars meant that you are not only set for life, you have basically laid the foundation for the next three generations.

I am not saying that one million dollars is worthless, far from it, many Americans still do not have their first million, and may not see it in their life time. However the amount of goods or security that one million dollars can buy has definitely and visibly dwindled. Take for example, the price of our homes. Home prices have risen about 300% over the last 20 years. That would mean that a million dollars used to be able to buy a home three times as big 20 years ago versus today. Taking that as a prime example would mean that one million dollars today is only worth three hundred thousand 20 years ago.

But the more important question that we should ask, when we ponder the worth of our money is whether we are able to grow our money as fast as the annual inflation so as to maintain the value of our cash. If you do not grow your value by the amount of inflation, you are effectively losing the value of your wealth. And in twenty years, the one million dollars underneath your bed would only be worth one third as much. So dun leave your money to fend for itself, it cannot do so within the confines of your cookie jar or even that of your saving accounts.

Invest your money into the stock market would help you grow your money fast but this also comes with lots of risk. The safer bet in the stock market would be to buy the index or others would call indexing. That would mean that you would need to buy into the stock market index. This would be relatively “safe” as the stock market tend to perform well over the long term.

To hedge against inflation, you could also procure real estate. As mentioned above, property prices had risen over 300% over the last 20 years. Buying a good piece real estate can mean staying in line with price increases and maintaining the value of your wealth. Do not let your cash sit idling; make sure your cash is working just as hard as you.

At the end of the day, many people will be asking whether they can retire with just 1 million dollars. It is definitely possible but the standards of living that one million dollars can buy will fall with each passing year. I would bet that one million dollars would not be sufficient in another 10 years time. So be prepared and do your sums right.