Leaving a job can bring many changes, including decisions about what to do with your 401(k) or 403(b). These retirement accounts are valuable tools, but if left unattended, they can be vulnerable to market volatility, fees, and missed growth opportunities. Converting these accounts into a Fixed Index Annuity (FIA) can help secure guaranteed lifetime income while protecting against losses.
The Risks of Leaving 401(k) or 403(b) Plans Untouched
When you leave a job, your retirement savings remain in your former employer's plan unless you take action. Here are some risks of keeping your funds there:
Market Exposure: Market downturns can erode your balance.
Limited Investment Choices: Many employer plans have restricted investment options that might not align with your retirement goals.
Higher Fees: Some plans impose fees that can diminish your savings over time.
Loss of Oversight: Former employees often lose access to plan benefits or fail to monitor their accounts closely.
To mitigate these risks, rolling over your 401(k) or 403(b) into a Fixed Index Annuity can safeguard your savings and create a reliable income stream.
What is a Fixed Index Annuity?
A Fixed Index Annuity is a financial product offered by insurance companies that provides:
Principal Protection: Your initial investment is safe from market losses.
Growth Potential: Returns are linked to a market index, such as the S&P 500, allowing you to earn gains without directly investing in the stock market.
Tax-Deferred Growth: Earnings grow tax-deferred until you withdraw them.
Guaranteed Lifetime Income: FIAs offer the option to convert your savings into a pension-like income stream that lasts as long as you live.
How to Build Your Own Pension with an FIA
Many Americans face retirement without pensions, which were once a standard benefit. An FIA allows you to create your own pension in these steps:
Roll Over Your 401(k) or 403(b): Transfer your retirement funds into an FIA to preserve tax advantages and avoid penalties.
Select an Income Rider: Most FIAs offer optional riders that ensure guaranteed payments for life. Some even provide spousal coverage.
Customize Your Plan: Work with an advisor to choose payout options, such as a fixed monthly income or adjustable payments based on your needs.
Enjoy Peace of Mind: Unlike traditional investments, your FIA protects against market downturns, ensuring predictable income throughout retirement.
Why Choose a Fixed Index Annuity?
A Fixed Index Annuity addresses critical concerns for retirees:
Safety: Your principal is protected, even in volatile markets.
Growth Potential: Gain from market upswings without risking losses.
Lifetime Income: Ensure you never outlive your retirement savings.
Flexibility: Tailor the annuity to fit your retirement goals and legacy plans.
Expert Insights on Retirement Savings
According to CBS News, over 11 million Americans over age 60 are still working due to insufficient retirement income. Many of these individuals could benefit from converting their old 401(k) or 403(b) into an FIA to achieve financial independence and reduce stress during retirement report from the Insured Retirement Institute (IRI) emphasizes the growing demand for guaranteed income products like FIAs as retirees seek to replace traditional pensions .
Takeaway
Leaving your retirement savings in an old 401(k) or 403(b) could jeopardize your financial future. Transitioning to a Fixed Index Annuity can provide safety, growth, and guaranteed lifetime income.
Call Barry Group today at 866-540-9122 to schedule a consultation with an elite advisor. Let us help you create your own pension and achieve financial peace of mind.
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