Partial Sell: Claymore S&P US Dividend Growers ETF (CUD)
Addition: Omega Healthcare Investors Inc. (OHI)
Addition: Vanguard Total International Stock ETF (VXUS)
Closed: Consumer Staples Select Sector SPDR (XLP)
New blog posts
Let dive into the links that caught my attention this week.
Updates from My Portfolio Holdings
- Deutsche Bank Upgrades Medtronic (MDT) to Buy, price target raised from $56 to $66
- FDA Okays New Johnson & Johnson (JNJ) Hep-C Drug
- Husky Energy (HSE) Profit Falls 3%
- BAC does a 180 and upgrades Archer Daniels Midland (ADM) from Underperform to Buy
- Is Chevron’s (CVX) Stellar Stock Trading at a Pollution Litigation Discount?
- Three Reasons I Enjoy Watching Stocks I Own Decline In Price by DM
- A Retirement Income Strategy by MJoM
- How Much Do You Need to Save for Ealry Retirement? by MDJ
- Portrait of An Ideal Saver by B&E
- How Do I Retire At 35? by CF
- European Utilities Stocks Are Declining
- Here’s Where to Find Great Dividend Stocks by DGS
- 2 Buffett Stocks on Sale Now by DL
- Procter & Gamble (PG) Dividend Fact Sheet by DE
- Genuine Parts Company (GPC) Dividend Stock Analysis by DGS
- International Business Machines Corp (IBM) Dividend Stock Analysis by DGS
The best way to buy annuities is to know as much about them as you can to make an informed decision. Here is what you need to do before buying an annuity for your retirement:
Don’t commit to the first insurance company you contact about buying an annuity. Ask to speak to someone about the type of annuity they could offer you, what it would cost you and its advantages and disadvantages. Let the company know you will be in touch, and gather between three and five quotes from different companies and compare your options.
Compare interest rates, commission fees, surrender charges and other fees that would apply in the event that you need to withdraw from your annuity early or sell your annuity in the future.
In the event that you need to forgo the annuitized payments and you decide to cash in your annuity for a lump-sum payout, each company may penalize you differently. Make sure you know the terms and conditions of each contract and decide which one is the right one for you.
Know How Much You Need for Retirement
Look at your current lifestyle and project what you would need from retirement income. Factor in other sources of retirement income, such as Social Security, to determine what your long-term financial goals are for your annuity.
This will give the insurance company a better idea of what kind of annuity is right for you, and you can make a more informed decision if you know what you expect to invest in a certain amount of time.
Buy From a Reputable Company
Insurance companies that buy and sell annuities are not created equal. A referral from one of your friends may be a good place to start, but what works for your friend may not work for you. Make sure the insurance company you buy your annuity from is highly rated by a financial institution rating agency, such as Standard & Poor’s, Fitch, AM Best or Moody’s.
You can obtain a professional rating by calling the insurance company directly or by visiting a financial institution rating agency’s website.
Know the Terms and Conditions Before You Sign
This shouldn’t be a problem if you buy your annuity from a reputable company, which will go over the contract in detail with you, but it is always good to read the contract in its entirety and ask questions about anything you don’t fully understand. You can even have your contract reviewed by a financial adviser to make sure there are no hidden fees or fine print.
Annuity terms and conditions may vary depending on the insurance company you are working with, but here a few general things you should know:
- All annuities grow tax-deferred.
- You cannot withdraw from an annuity before you reach age 59½ without penalty.
- All annuities provide options during the income phase based on how you want to receive your money.
- There may be fees involved if you withdraw early or sell your annuity in whole or in part.
Purchasing an annuity should give you some financial relief for your future. To ensure you make the best decision for your retirement, be informed on your decision before you sign on the dotted line.
Kaitlyn Fusco is a content writer for Annuity.org. She combines her interests in writing and overcoming debt to inform the public about issues related to credit, debt, annuity and personal finance.
The blue line shows the S&P500 index and the red line shows the performance of Berkshire.