Over the years, the way America retires has changed. Unfortunately many have not adapted well to the changes, but there are options.
Many of our parents grew up in a time when company pension plans were common amongst employers. After a career with a company, there was the promise of a retirement income that would last their lifetime or even for their spouse’s lifetime as well. They were able to enjoy the comfort of a guaranteed paycheck for life that they could count on during their golden years.
For most of America, times certainly have changed. In fact, the U.S. Bureau of Labor Statistics reports that in the early 1980s most Americans working at larger companies were covered by their employers’ defined pension plans. By the 1990s, only 35 percent of all private industry workers were covered by a defined benefit pension plan.
By the year 2011 that number had shrunk to 18 percent
as many companies transitioned to offering defined contribution plans that require employees to make contributions to the plan.
The age of working all your days for a company, and that company looking after your needs in retirement, is gone. The gold pocket watch and the golden parachute are a thing of the past for most Americans.
So as you watch the retirement landscape transforming before your eyes, what actions can you take to give you confidence in your retirement strategy and provide you with income throughout your retirement years? I’m reminded of a quote by the great hockey player Wayne Gretzky: “I skate to where the puck is going to be, not where it has been.” So where is the retirement income “puck” going to be?
More and more baby boomers and retirees are discovering the innovations to fixed indexed annuities that include guaranteed lifetime withdrawal benefits. These contracts provide retirees with much-needed options — attractive options like contracts that provide income for life no matter how long you live.
The guaranteed lifetime income contract has fueled sales of fixed indexed annuities in recent years and for many, these annuities are where the proverbial puck is going to be.
As boomers and retirees increasingly turn to insurance companies for income solutions, so does the government. In July 2013, Sen. Orrin Hatch introduced a bill
designed to transfer the risk of insuring public pensions to insurance companies.
, “America cannot continue sleepwalking into the financial disaster that awaits us if we do not get the public pension debt crisis under control.”
In our parents’ generation there were many companies that offered pensions to bear the risk of longevity. As the winds of change blow, our retirement income options evolve. It’s important to examine your alternatives carefully and decide how best to address your longevity risks. Fixed indexed annuities can provide principal protection from market downturns, contractual guarantees, and income for life.
If you are concerned about outliving your money, consider passing the longevity risk off to an insurance company by using an annuity to generate income throughout your retirement years. A portion of your money earmarked for retirement can be used to cover your retirement expenses by generating a predictable monthly income for the rest of your life.
about these important insurance company contracts called annuities when you get Crown Atlantic’s Annuity Primer. Also, if you’d like to meet with a Crown Atlantic specialist to review solutions that can guarantee you income no matter how long you live, go online to CrownAtlantic.com/Protect
or give us a call at 855-221-5546.
Joe Stark is the CEO of Crown Atlantic Insurance, LLC in Boca Raton, Fla. Stark is an insurance industry veteran with more than 25 years of experience. For more of his reports, Go Here Now.
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