More Good News About Immediate Annuities

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As the stock and bond markets both begin to really show signs of wear and tear from the global recession, today’s retirees are starting to wonder what else they could honestly focus on in order to move up in the retirement ladder. Or maybe they’re just worried about keeping everything together without really growing their money extravagantly. Isn’t that what we should all be worrying about?

Of course — but why worry when you already know ahead of time that the tools you need are definitely out there? Now is the perfect time to really make sure that you’re thinking about the type of lifestyle that you really want to lead. You don’t want to find yourself being unable to get things done just because you’re a little worried that you’re going to run out of money. As much as we would love to have more money in retirement, we have to make the most out of what we have, and that can be difficult.

Yet it really doesn’t have to be that way at all. There are immediate annuities out there that make sure that you will get a steady monthly check for the rest of your life. You will have to put up a lump sum payment first to the insurer, but then you will get a monthly check after that. However, there are advantages and disadvantages of an immediate annuity that you need to think about.

So let’s take it from the top, shall we?

As mentioned earlier, an immediate annuity is actually different than a deferred annuity. The difference is right in the name, too – immediate means just that. Once the company receives your lump sum, they’re going to start cutting you checks. How big are those checks going to be? Well, that depends on how much you actually deposit. Let’s say that you decide at 59.5 to start easing into retirement — you still have money coming in from work, but you might not want to rely on it forever. You’ve already reached 1 million dollars in retirement savings. If you started early, then this actually isn’t as hard of a goal as you might expect — not with the time value of money on your side.

Immediate Annuities

By the way, we picked 59 1/2 because that’s when you can usually touch all of your retirement accounts without a penalty if you did want to start doing withdrawals. So you have the 3500 from work, 1 million in savings — and we’re going to take 25% of that and put it into an immediate annuity. You’re going to receive roughly $1,300 a month from this annuity. Now, that might not seem like a lot — just $15,600 a year. Yet if you live 25 years after you get the annuity, that’s $390,000 in total payouts. So it’s quite possible to actually get more back over a lifetime than what you put in.

So you would have the $3500 from your job, the $1300 from the annuity, and later down the line you would also have Social Security — the average monthly payout is about 1,200. So where do you go from here?

You work on the systematic withdrawal of your funds as well. We would definitely be remiss if we pretended like the only thing you needed to rely on was your annuity payments, or even Social Security. But remember that you have another 750,000 socked away in savings. So even after you quit your job, you can start withdrawing 3500 from your retirement account — which will indeed keep growing even though you’re taking from it. The whole point of a retirement fund is that you finally get to enjoy it after a while. So why wouldn’t you want to do that?

Yes, the benefits of an immediate annuity are great — having a steady income that lasts as long as your lifetime lasts is a smart idea. In addition to those benefits, you’re also getting a very low-risk. You see, unless the provider of the annuity isn’t financially secure, then you’re going to be just fine. The funds are guaranteed by the assets of the insurer. This means that the stock market doesn’t play a role.

Like with other low-risk investments, the problem that you’re actually going to be facing is that you can get a better return on your money. You can take on riskier investments that have a higher growth potential — but you can also lose it all, and that’s not something that most people really want to deal with. You don’t want to look back on everything that you’ve done and find that you’re losing your money simply because you were chasing the highest interest rate, right? this is where diversification is really important. You can still throw money into an immediate annuity and then chase that higher growth factor. But you’ll always have that nagging point that 25 percent of your money is into something that isn’t going to grow as quickly — but it’s going to be dependable when you need it most.

What about when you’re thinking more or less about inflation? Inflation is really the enemy of good finance everywhere, especially in the investing world. yet there’s not that much that you can do about inflation except see about an inflation rider on your annuity. That way your payments would be adjusted for inflation, giving your money even power no matter how many years go by.

Insurance companies are the ones behind the annuity, but don’t think that you’re not going to find people offering annuities from investment centers, banks, and other arenas.

What about your spouse? Should you get an annuity that covers them too? Well, that depends. It’s actually better to go with the standard single life immediate annuity and then get a life insurance policy for you — that way if you die before your spouse, they can use the proceeds to pay for an annuity of their very own. Getting an annuity that covers you both tends to be much more expensive than breaking things up, so to speak.

What about your heirs? Unless you opt for a plan that pays out for a certain period to your heirs, once you pass on that’s it for your annuity. So if you are worried about wealth transfer, a standard life insurance policy is really the best way to go.

Overall, now is definitely the time to take matters into your own hands and get an immediate annuity — you will definitely be glad that you did!

Having No Set Financial Goals Can Be a Good Thing…Sometimes!

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So, let’s change gears, shall we? What if you really don’t have a lot of financial goals right now? It’s a question that we’ve been getting lately, primarily from people that are just starting out. They don’t have any dreams of getting a home, and they certainly don’t want to get a car right now. What should their path really be?

Here’s our answer: nothing. Well, not much anyway. It’s sort of like weight loss — not everyone is going to need to lose 100+ lbs, and there’s nothing wrong with that. You don’t have to have any guilt because you don’t have any big down payments to save for or that you don’t have a job with a 401(k) yet. There’s going to be a lot of times for those things to happen. There are going to be times where
you’re going to want more than what you have right now, but isn’t that everyone?

Financial Goals

Generally speaking, you can just make sure that everything is balanced right now in your life. You will want to make sure that you think about the type of life you want to live in the present time. That means right here, right now; you have the right to design your life around your own wants. If you are happy right now getting your rent paid and having a few nights out with your friends, then there’s nothing wrong with that.

However, you do want to make sure that you have enough organization to make the rest of your life smoother. For example, if you’re working you need to make sure that you’re keeping enough documentation to make filing your taxes a breeze. Saving your paystubs and other related information is definitely a good thing. In addition, you will also want to make sure that you have an overall budget. Now, this doesn’t mean that a budget has to dominate your whole life. It just means that you need to have an idea of what’s coming into your home, what’s coming out of your home, and whether or not you have enough money for your lifestyle. If you’re finding that you’re constantly late on bills or running out of money, that’s when you need to take action.

Is saving important? Absolutely — but you don’t want to flip out and think that it’s impossible to really get the things in life that you really want in the present just because you’re saving for the future. It’s very easy to go overboard, so the real key in balance here.

Overall, what we’re saying is simple: having no set financial goals is nice sometimes — it lets you stay in the moment and enjoy a very short window of your life. You have a lot of time to get serious about life. That’s not to say that you can’t get started early, but don’t stress out over it, either!

Is Your Retirement Really Safe In the Bankruptcy Scheme of Things?

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Choosing to walk down the path of bankruptcy is something that can absolutely change your entire life. It’s hard to pick through the attitude that a lot of the media has towards bankruptcy. If you let the media tell it, everyone declaring bankruptcy is just looking for a free ride out of their problems. If you haven ‘t woken up and had to make the decision on whether to eat or pay the bills, then you haven’t walked through some of the choices that many people facing bankruptcy have had to make time and time again.

If you’ve worked hard all your life and built up a nest egg, you might think about using it to cover your debts. However, when you make the decision to take future savings and apply it to debts that are covered under the bankruptcy code, you’re actually throwing good money after bad purposes.

You see, the assumption made here is that the bankruptcy trustee will simply seize your retirement account and use it to pay off your debts. That’s just not true at all — there are exemptions made for all types of different assets. For example, if you have a modest home, you are most likely not going to be forced to give it up in the bankruptcy. This is because you have to live somewhere. Same with your car — you have to get back and forth to work and to take care of your children and/or other family members. The bankruptcy process is a matter of public policy, which means that it’s not designed to be incredibly cruel. Now, if you have a five million dollar home, you can bet that you’re not going to be able to keep that. In addition, if you’ve got a luxury sports car hiding in your asset sheet, that’s going to be taken away from you. However, if you’ve got a 3 year old car that you’re making modest payments on, you’re highly unlikely to lose that car just because you filed bankruptcy.

Bankruptcy Scheme

But let’s get back to the retirement account. It’s all about amounts here, as well as the type of retirement account that we’re talking about. A 401(k) that has less than a million dollars in value is going to be exempt — over that amount and you can expect some trimming to be done. The assumption is made here that a million dollars is for the future years where you will not be able to work. There’s no reason to think that you will be expected to take your precious savings and put it toward debts that will be discharged anyway. Be cautious of any financial planner that tells you otherwise, or tries to make you feel guilty because you want to hold onto that money. There may come a time where you’re not able to replace that money easily. If you end up taking loans out of the account to pay off debts that can be discharged, you’re only slowing down the growth of your money tremendously.

Of course, it has to be said that if you have a million dollars in the retirement fund for the future, you will definitely be better off hiring a bankruptcy attorney. Assets of any kind mean that you need to have legal representation at your side. Even if you think you won’t need it, running your case details over with a qualified attorney that has the bankruptcy experience is definitely a good thing.

The last thing that you will want to do is try to hide the retirement account. Thanks to bank disclosure laws today, you cannot hide money in any way, shape or form. It’s very difficult to do, and if you’re found out to be purposefully hiding assets, you’re going to end up losing your ability to discharge your debts. That’s not even the worst thing that can happen — you can be thrown in jail for bankruptcy fraud. It’s a federal issue, and it’s a very serious one. You don’t want to walk down this road — and any bankruptcy attorney worth their retainer will tell you the same thing.

Overall, your retirement is definitely safe even in the face of bankruptcy. So don’t pillage your accounts to take care of problems that are already covered by public policy and established precedent!

Is Getting A Tax Refund Worth It?

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Tax time is coming, and if you haven’t done your taxes yet — you definitely need to get on the ball! Some people tend to wait until the last minute, even if they know that they’re getting a refund. A refund is simply an overpayment from the IRS, and that ultimately means that you simply paid too much into the system. Do you really want to give the IRS an interest-free loan? They’re not your friend, so there’s no need to be friendly to them. On the other hand, there’s no need to act like you’re an enemy — the IRS has a way of dealing with enemies, and it’s not fun.

You just need to think about how you will handle your taxes. There is a debate going on right now in the finance world that simply boils down to one question: is getting a tax refund worth it? These days, many people are weighing in on both sides. Here’s what you need to know.

The people who say that you should get a tax refund are primarily looking at all of the things that you will be able to do with the money. Generally speaking, this is usually the time of year where people buy a lot of impulse and luxury times with their tax refund. If you’ve been dying to buy a new car, you will have to use your tax refund as a down payment — or if it’s large enough, the whole thing to buy the car. Some people decide that they’re ready to move, and hence go ahead and move with their new tax refund.

Tax Refund

The problem with all of this is that it’s focused on things in the short term. Impulse and luxury times won’t always be long term items, and that means that another year will pass and there will be other things that catch your interest. If you only think about what you can out of the deal, you will not be growing your financial future properly. It’s a lot smarter and easier to think about your financial goals, and then take most of the tax refund and put it towards those goals. This can mean anything from the retirement account all the way up to making a charitable donation. Either way, these events will help you during tax time.

Now, you do have the other side that believes a tax refund is grossly unnecessary. It’s better to take that money and put it towards next year’s actual taxes — that will take the sting out of them. After all, you’ve gone 12 months without the money, so it’s not like you need the money in order to maintain your status of living.

However, people counter these points by saying that for a lot of middle-to-low income families, that tax refund is a time where things get better. Food and other day to day expenses can be bought in larger quantities, which means that the family can stretch things out during more lean and harsh times. It’s just a matter of looking where your family is and devising a way to get things back on track in a way that doesn’t have anyone feeling deprived.

When you feel like you can’t spend money, you tend to go overboard when you finally get money. If you stop and think about the real things that you and your family want, you might be able to find a compromise. You can always say that you will do a 60/40 split of your tax refund, or you will just use the tax refund for the bills.

Paying down credit card debt is a great way to really get the most out of your tax refund, but this isn’t something that a lot of people think about. If you really want a high return on your money, paying down your debt really is the best way to go.

Overall, there are a lot of arguments on both sides of the coin. We think that a tax refund is definitely worth it if and only if you already have a plan in place to use the money. After you file your taxes, you generally have to wait about 2-3 weeks to receive your refund via direct deposit — why not use that time to really sit down and think about your wants, needs, dreams, and goals? You’ll be glad that you did!

So You Got Fired, Now What?

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When you’ve been working at a job for a long time, you start to feel what most people would describe as job security. However, you’re only as secure as your company’s performance. When things start going downhill and there are cuts to be made, do you know what the first area of attack is?

We’ll tell you — personnel. Indeed, that means that the job that you thought was so secure can be gone in a heartbeat. For some people, losing a job isn’t a major event — many people can often see the writing on the wall, which means that it’s pretty obvious that they’re going to lose their livelihood. Having a savings account or a second income also helps, because then you’re not worried about how your family will eat tomorrow.

Unfortunately, there is still a large amount of people that truly aren’t ready to be fired from their jobs. So when it happens, they feel like there’s really no way out for them. They will have to beg the government for assistance, which is never enough to enjoy the lifestyle that you had.

job security

Whether you’ve been fired for other actions that you may or may not be responsible for, or you have been laid off due to a change in the company’s economic futures, you will need to have a strong plan of making things right before it’s too late.

First and foremost, you will want to make sure that you’re as stable as you can be emotionally. You’ve been hit by a major life change, and that’s going to hurt. It’s going to affect you more if you have a family at home; because you will feel like there’s no way that you’ll be able to give your family everything that they deserve. You might even feel compelled to hide the information from them, leaving someone to figure out that you’re no longer working anymore at a very bad time. It’s better to come clean and ask for support than it would be to just assume that you’re not going to find any type of support waiting for you at home. It’s something that can really drag you down when you really think about it, but that doesn’t mean that it really has to be that way. It’s just better to come clean and actually talk about things instead of hiding them. Eventually, the truth of your job loss is going to become obvious, and your family will resent you for hiding something so important from them.

The next steps after you have admitted the problem to everyone is to immediately think about a plan to get back on your feet. This usually means getting some sort of budget in place, one that’s different from the budget that you might have had when everything was good. This means that you will need to cut back on all of the unnecessary expenses. It might seem cruel, but one of the things that really throw families off balance is the way that they spend. When things are good, it’s very tempting to spend a little more than you know you should. Mothers who bring their children to the grocery store know that they really shouldn’t let their children throw things into the cart that aren’t supposed to be there, but it’s hard to really deny your family anything at all. It’s better to really step back and think about the type of life that you want your family to have — and then work towards it. Yes, it’s going to be hard in the first few weeks to make sure that your family will survive.

If you do have savings, now is the best time to pull them out. You don’t want to wait until the last minute to attack your savings, because this will only make things worse. If you can actually get your savings out and have a plan to spend them wisely, you’ll be a lot better off.

However, if you’re like the many people across the country that really doesn’t save their money, you might not have any savings to speak of. Sure, there’s your retirement, but you really have to step back and think about whether or not you want to spend your retirement. It can be tempting to jump at your retirement account, but the truth is that you really might not want to. For example, if you think that the market will pick back up and you really do have a way of bringing more money quickly, then it might be better to go with the alternate income than to raid your retirement account. Once you take the money out, it will be hard to force yourself to put the money back in, let alone pay interest. Again, if you have to make the choice between your family starving and raiding your retirement account, then you definitely want to make sure that you raid the retirement account already. It’s really the best way to go.

From a career point of view, the worst thing that you could possibly do is just give up. That’s not saying that you shouldn’t take unemployment insurance or whatever is available for people that don’t have jobs anymore, but the last thing that you will want to do is just assume that there’s no future ahead of you. Bills will be due and there will still be things that need to get done. Instead of worrying and lamenting about these things, you will need to make sure that you keep moving your career forward. If you live in the shadow of a major city or directly within it, you should be able to benefit from many of the meet and greets that are done now for people that are looking for work. This is a good way to network and make sure that you still get your name out. If you have a little bit of money saved, you might want to go ahead and print out some business cards.

Don’t forget your local workforce commission center, because they will provide free career preparation services and even have local businesses come to do job fairs. This is also a good way to meet the local hiring force. You should make sure to dust out your old business causal clothes. If you don’t have clothes for success, you can always buy them used or even rent them for interviews. That way you still send a good message without having to shell out hundreds of dollars.

It can be difficult to balance all of the decisions that you will need to make and all of the points that you will have to consider when you’re out of work, but don’t give up — things can always change for the better!

The Best Way to Obtain Adequate Fraud Protection

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Fraud is frighteningly common in the UK and with over 80,000 cases of identity fraud reported already in 2011, there is no wonder why credit providing businesses are seeking protection from experts.

Providing finance solutions to consumers can be an effective way of driving sales through the door but without modern fraud protection tools in place, the business is exposed to deceitful customers. The forecasted figures may initially represent high sales but if a customer fraudulently avoids repaying then the revenue is never incurred from the sale and the business makes a big loss.

Fraud Protection

There are comprehensive tools available from certain credit reference agencies which enable for in-depth customer tracing, in order to recover debt. Such programmes are designed to pinpoint exact customer locations based on multitudes of data, sourced from a variety of state records.

Still, through the advice from these agencies there is an underlying notion that ‘prevention is better than cure’. More and more businesses are choosing to reinforce their initial customer screening system before approving them for credit. The approach is much more effective than chasing fraudsters all over the globe.

Know Your Customer policies are becoming more common amongst credit providers – requiring meticulous verification of customers/clients before establishing a finance agreement. However, it can be difficult for businesses to execute such detailed identity verification without the latest KYC assisting tools.

Some programmes can now verify customer data in seconds – adding a subtle but effective layer to a provider’s shield against fraud.
When operating through an agency it is important to determine if their solutions comply with current Anti-money Laundering legislations. If so, associating businesses can remain confident that their credit will only go out to legitimate customers and if a fraudster should slip through the cracks, they have the tools at hand to track them down and recover debt.

The Finer Points of Pooling Money Together with Your Significant Other

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If you’ve been dating someone for a long enough time, you might be getting serious. Now, the degree of seriousness depends on what your goals are. You might just be dating, or you might already be engaged. You could even be married right now. It really doesn’t matter what type of relationship you’re in. If you’re thinking about mixing money together, there are quite a few things that you need to keep in mind.

First and foremost, you will need to make sure that you sit down and have a long talk about what you feel is important from both sides. It’s not just enough for you to dictate what you think about money and how you think things should be. If you both have trouble with money in any way, then you really don’t want to combine resources. It’s only going to lead to hurt feelings. Pooling resources together can really help you get things done, from buying a car together all the way up to buying a house. A house is a big decision, and you will need to think about a lot of different things all at one time.

mixing money together

The way you feel about money matters. For example, if you’re someone that doesn’t like to spend money and your partner does, then you’re going to fight about money. If your partner thinks that money is evil, they can block you from getting more money than what you would need to pay the bills. It just needs to be something that needs to be brought up front.

If you have more assets than your partner and you want to get married down the line, you are going to need to discuss a pre-nuptial agreement if that’s what you want. It’s better to get it out of the way immediately than to assume that no agreement will be signed. Now, if your partner is warned in advance and the points are actually discussed without being adversarial, you will not get too much pushback and resistance. However, if you only think about your perspective, then you won’t do anything more than anger your partner. They will feel like you believe that they are only in it for the money instead of love and that can lead to a lot of resentment.

The best way to make sure that you are dividing things up is to look at all of your expenses, and then look at the income that everyone in the relationship is bringing in. Splitting things down the middle is fair — but you don’t want to just think about the expenses themselves. You want to make sure that everyone is splitting their income in half. Now, if your partner doesn’t make as much, then you might want to change the percentages to make sure that they still have their own money.

You can put the money for the bills into a joint account, plus a little extra for a “rainy day”. If you aren’t saving as a couple, then there will be problems when one of you has a life changing event. For example, what would you do if your partner got sick or lost their job? If you aren’t putting away a little extra as a unit, then you won’t be able to catch up when you’re dealing with life’s challenges.

Overall, these are just a few things to think about. If you’re really thinking about taking the next step and pooling resources, this is a good guide to get you moving in the right direction.

A Return to Building a Strong Financial Foundation Worth Talking About

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When you need to make sure that you are moving in the right direction financially, you should know that it’s really all about building the right foundation. You want to make sure that you have a foundation for your money to grow, and that can take some time. Yet if you are just starting out, it can be hard to figure out what makes a strong financial foundation. A lot of people know how they would feel if they had a strong financial foundation, but they don’t really know what they would do with an actual strong financial foundation, nor do they know how to build one.

Like most things in life, it’s really not that difficult. Here’s what you need to do.

First and foremost, you will need to make sure that you actually look at how much money you are making. Now, a lot of financial guides ignore the power of income, focusing only on the type of expenses that are coming into the house. However, in order to figure out what type of financial footing that you’re on, you will want to make sure that you think about how much you’re actually bringing in. Now, when it comes to income, you don’t want to just look at your total paycheck. No one really lives by their total paycheck, because there are taxes and there are usually insurance premiums that are going to be taken out along with any retirement contribution. You have to look at take home pay in order to figure out how much money you really have to work with.

Financial Foundation

So, what do you do from here? Well, after you’ve looked at your income, you need to look at your expenses. You need to have an idea of what will be going on in your finances — if you don’t know what expenses you have, you will have a hard trouble building anything.

If your budget seems okay, then you will want to expand things to look at the big picture. Do you already have life insurance? If not, why not? From there, you have to make sure that your debt is under control and that your credit score is proper. If you don’t know what your credit score is, you need to look getting your credit report and your credit score along with it. You get a free report every year, but you will have to pay a little bit extra to get a credit score. That credit score tells you how you look in the yes of lenders. If you want to get a car or even buy a house, you will need to have better credit.

Overall, you need to just sit back and think about the type of life that you want to live. Now, it can be hard to really think about it in a big way, but the truth is that looking at the big picture helps you define your financial future. If you really think about things as they come along, then you shouldn’t have any problem building a strong financial blueprint over time.

Improve Your Bottom Line With These Energy-saving Tips

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Your bottom line is a telling figure that reveals how business-savvy you are, but it is about more than just profits. The more you can reduce your overhead costs, the more success you will see as a business owner. Find out how you can keep more of your hard-earned money in your pockets by reducing energy costs for your company with these energy-saving tips.

1. Use energy-efficient office equipment.

With a renewed interest in energy-efficiency and green lifestyles, the market for energy-saving appliances has increased significantly. When you are ready to upgrade your working equipment, such as copiers, printers and shredders, look for product information that points to greater energy efficiency – and thus, less business electricity use. Another way to save on the energy that your office uses is to employ laptops instead of bulky and costly desktop computers.

2. Make use of natural sunlight.

Instead of keeping the lights on in the office all day, take advantage of the early afternoon, when the sun is at its peak, by turning off the lights after the lunch hour. In addition to saving you energy on lighting, this tip will also treat your staff to a stimulating view and keep them motivated. To help your employees benefit from the sunlight, arrange desks and work areas near large windows.

3. Make sure you are getting the best rate on energy.

As with all aspects of maintaining your business, you should investigate which company provides the best product for the lowest price. Compare energy prices in your local area with a Web site like uswitchforbusiness to make sure you are not being taken advantage of by your energy provider and to find out how you can switch if you are.

4. Use air conditioning and heating as a last resort.

During the summer when the temperatures rise, try using fans to circulate air instead of turning on the air conditioning. When the colder months arrive, encourage your employees to dress in thick layers to keep warm. This will keep you from overworking your HVAC system and save you money on cooling and heating costs.

5. Keep your HVAC system in good repair.

Speaking of your heating, ventilation and air conditioning systems, it is always a good idea to call in a professional maintenance person at least once a year to check out your vents and parts. Sometimes small businesses can even employ these professionals via a contract that will give you reduced rates for using the same company year after year.

6. Use a programmable thermostat.

These handy little devices are inexpensive to purchase and easy to install, all in exchange for huge savings on your office’s energy bill. You can programme your thermostat to keep the office at a stable temperature, which is often less costly than turning it on and off at the beginning and end of each day.

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