Paul Pent & Associates - Retirement Advice Blog

Financial Insight Blog

Financial Review Online

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Now you can get a "Financial Second Opinion" and a financial review online. With increased demand, we want to make it easier for you to see if our method of planning for retirement works for you. Continue into the main body of this article to see how you can easily order your personalized financial review...

It's a simple question and  will possibly save you hundreds of thousands of dollars. Let's assume you are a 65 year old man and you would like your wife or kids to have 1 million dollars guaranteed upon your death. What would you do? You have a couple of options...

1. You could put $1,000,000 in a checking account or CD or some type of savings account.

2. You could buy a $1,000,000 policy that guarantees level premiums for life, even if you live to be 120 years old.

Problems with option 1 are many. First off, it's way too expensive! Who wants to have to keep 1 million dollars tied up for an unknown amount of time? Second; interest rates are low. Third; banks fail and if not structured correctly, your money is not guaranteed.

So here's the solution. At age 65, instead of putting aside 1 million dollars all you need is $300,000 (if you are in reasonable health). That $300,000, when structured correctly can fund what's called a GUL. All top life insurance have GUL's and the price can be shopped so it may be a less. This seems very simple but I am amazed at how many people are floored when they see this for the first time. They love it. Obviously this method can be used to provide any amount for your spouse or loved ones. Contact us for your free quote or call us at 1-877-797-PAUL

 

A Great Alternative for Your IRA from Allianz Life

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MINNEAPOLIS--(BUSINESS WIRE)--Allianz Life Insurance Company of North America (Allianz Life) today announced the launch of Allianz 360, a fixed index annuity (FIA) that is exclusive to Field Marketing Organizations (FMOs) and agents associated with the recently introduced Allianz Preferred distribution model. Currently available in 36 states, the newest FIA to Allianz Life’s lineup offers unique increasing income benefits for both accumulation and income.

Four Misleading Pieces of Retirement Advice

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U.S. News did an article recently, "Four Misleading Pieces of Retirement Advice." It's not that the article was right or wrong, it's that they ignored the best solutions altogether. Case in point, they talked about how seniors should be careful when withdrawing 4% of theri retirement each year to live on. They make the case that if your accounts are at risk you need to withdraw less when the market crashes and your accounts are depleted. Unfortunately they miss altogether that if one takes their money out of market risk altogether they could easily withdraw 4% a year and be guaranteed to never run out of money as long as they live.

We talked about this subject a little this week at the end of our radio show. Right now a few companies that I know of are offering a guaranteed roll-up rate of 7% (sometimes more) if the funds, once withdrawals begin, are taken out at a rate of between 4% and 6%. This kind of account works great for IRA's and other qualified funds that need to stay tax sheltered. As usual, give us a call for further details and to see how this can benefit you.

A Better Alternative to Long Term Care Insurance

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If you or a loved one are thinking about purchasing Long Term Care Insurance, you may want to think again. Take a look at this special you tube presentation by Finance, Faith, & Philosophy. You'll be glad you did. The biggest problems with LTCi are the high costs, the possible increase of premiums, and the possibility that it will never be needed or used. So what is a person to do? Self insure? No. There is now a much better way to solve the problem...

Click here

The True Cost of a Loss

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Last week we talked about the importance of buildinig insurance into your retirement funds. The reason is to eliminate loss. We have reviewed many retirement accounts that gained 30-50% in 2009 and talked to brokers who are very proud of that fact. Unfortunately they are hiding something. They are hiding the previous years returns and sweaping them under the rug. Let's take a look and see why a 50% return isn't close to what most people think it is when preceeded by a year with a 30-50% loss. Here's the math: If you have $1000000 and incur a 50% loss like many in 2008, your account balance is $500,000. Now, you may think a 50% gain would be nice because it will take your account back to where it was before, but you'd be wrong.

$500,000 at 50% interest for 1 year will only bring your account back to $750,000. So a 50% loss followed by a 50% gain is a 25% loss. Ouch! It's best to just eliminate loss in your retirement account altogether. Call us at 1-877-797-7285 to see how you can take advantage of retirement accounts that do not participate in market risk.

We talked about this chart on the radio show this week and last. It speaks for itself. Fixed Indexed annuities won the war of return of investment plus there was no market risk involved.

also included is the performance of some "high performing" mutual funds I run into quite a bit because they have been grossly over promoted over the last 20 years. Basically, they have returned about 0% for the last decade.

Estate Planning and Life Insurance

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Suppose you are a 65 year old man and you would like to make sure your wife will have at least $1,000,000 to live on and give to your children upon your death. An extremely inefficient way to do this would be to hold the money in CD's or investments. The best way to pass 1 milliion dollars tax free to your beneficiaries is through a permanent life insurance contract and possibly a Life Insurance Trust. For this article let's just look at how the life insurance numbers break down:

This is a bitter sweat moment for me. Up to this point, Smart Money magazine has done nothing but feed the public with false information about fixed and fixed indexed annuities. Now, they seem to be coming around and I'll be sad if they stop providing us with so much fodder for our radio show. Of course this is purley selfish so I must say, "Welcome to the club, Smart Money." Annuities are a great way to save for retirement. If only they had figured it out a little earlier, so many that listened to their advice wouldn't have lost so much money for their clients.

Here's the link to the article we've been talking about  for the last couple of weeks...Smart Money

Living to Age 107

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Retirement models we've seen in tha past from brokerage houses and mutual fund companies have failed due to two reasons. The earnings aren't what they hoped and people are living longer than what was expected. This only demonstrates once again how important it is to have guaranteed forms of income, even if you live to be 107. Think it's not possible? Check this article out I just found on Bankrate.com...

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