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Variable annuities are not suitable for short-term goals because insurance company charges may apply if you withdraw your money early. The buyer is exposed to market risk but has the possibility of a larger income during the payout phase. Something like a fixed indexed annuity (FIA), on the other hand, is relatively low risk because it guarantees* a specified payout if an income rider is selected, regardless of how the underlying investments perform. You may not think of real estate investment as a retirement savings option, but it is an excellent way to diversify your portfolio. Real estate is well-balanced between risk and returns to provide attractive gains with less volatility than the stock markets. It also provides protection against inflation. As prices rise, so does the cash flow you get from the property.
Something Like a Fixed Indexed Annuity (FIA),
on the Other Hand, Is Relatively Low-risk...
The government offers tax breaks for property depreciation, insurance, maintenance repairs, travel expenses, and property taxes. Real estate investors are also entitled to lower tax rates for their long-term investments.
Source of Income: IUL & SDIRA
Roth conversions are not for everyone. Here are some of the instances when you wouldn’t make a Roth role: An insurance policy isn’t typically thought of as a source of income but, with the right plan, that’s exactly what it can be. An indexed universal life insurance policy (IUL) is a type of permanent life insurance that pays interest based on the movements of the stock market. They function similarly to the FIAs mentioned above in that you’re protected from losses in exchange for receiving a reasonable and fair portion of the upside. An IUL is extremely flexible and could give you higher interest rates than other kinds of life insurance. They give you the option to use them as an income source, including the eventuality that you need to pay for long-term care or other major medical events toward the end of your life. The specifics of IULs are determined by the organization providing you with the product. It's important that fortune 500 employees always work with a financial institution they trust, read the documents closely, and ask a lot of questions.
One less-utilized investment vehicle for retirement savings is the self-directed IRA (SDIRA). This type of account functions similarly to a run-of-the-mill IRA with the added benefit that you get to choose where your contributions are invested. This means that your options for investment are much broader than a typical IRA where options usually are very limited, allowing you to further dictate the overall distribution of risk within your portfolio. The SDIRA is a great way to incorporate real estate investments into your retirement income plan, too. However, SDIRA custodians are not allowed to give financial advice, so the burden of research, due diligence, and management of assets rest solely on you. So, it is in your best interest to work with a financial advisor, you trust to guide you through these investment decisions.