Annuity Pros - Blog , Retirement Savings

Survive a stock market dip

Thu, 01 Aug 2024 04:28:01 -0700

Survive a stock market dip

Any dip in the market can set people on edge. Feelings of uncertainty and worry are only natural: We see the numbers in our retirement accounts go down and we want to stop the bleeding any way we can. Of course, being able to check balances any time of day or night — and watching those numbers plunge in real time — doesn’t help fight the urge to react immediately.

If you’re feeling on edge during a market tumble, whether retirement is just around the corner or years from now, here are some helpful tips to keep in mind to help navigate market volatility with more confidence

Don’t sell

Panic selling stocks may be your first initial urge, but it is never a smart move. In fact, when the market is down, it’s the worst time to pull your money out.

The key to protecting yourself against this kind of reaction is to have a portfolio that matches your financial situation and goals for the future, including factors like your expected retirement age and your tolerance for risks. If your portfolio is too risky for what your gut can bear — whether because of your proximity to retirement or not — meeting with a financial professional can help you adjust your accounts to better match your risk to what you can tolerate.

Look ahead … far ahead

Don’t just focus on your balance right now. If retirement is not around the corner (meaning less than five years away), you shouldn’t fear the short-term changes of the market.

Over the long run, stocks increase in value, but that doesn’t mean there won’t be periods where they will decline. Instead of panicking, view these dips as buying opportunities that allow you to buy stocks at essentially a “sale” price. And if you’re putting money into your account evenly throughout the year, that means you’re bargain shopping when prices dip.

Reallocate your funds

If you’re not far off from retirement and want to make sure you don’t get socked on a dip right before you’re about to start your next chapter, it’s time to talk to a Annuity Pros about reducing your risk.

If you are close to retirement, it’s important to be much more risk averse and have a more conservative asset allocation. That may mean taking some of your funds and buying an income annuity to assure a monthly cash flow during retirement. Another option is a longevity annuity, which provides you with an annual income at a certain age like 80 or 85, which can protect you from outliving your retirement funds.

Remaining calm during a market drop is difficult, but essential to staying on track for the future, whether retirement is close by or still several years away. Meeting with Annuity Pros can help you better understand changes in the market and how to weather a stock market plunge with more confidence.

Individuals and businesses who would like to connect with Annuity Pros can get in touch instantly via our enquiry form.

Annuity Products

Life Insurance Products

Get Started Now

How record inflation is affecting retirement savings

Mon, 01 Apr 2024 05:05:00 -0700

How record inflation is affecting retirement savings

Inflation has reached a level Americans have not experienced in decades. The rising cost of goods can chip away at retirement funds, and most people expect inflation to increase. The vast majority of people – 78% – expect inflation to get worse over the next 12 months, according to the new 2022 Retirement Risk Readiness Study from Allianz Life.

The big problem: Incomes are not rising at the same rate as inflation. Nearly 60% of people still in the workforce said their income is not keeping up with the rising cost of living. Forty percent of retirees said the same.

People who have yet to retire are particularly worried about how inflation will affect their ability to pay for necessities, save as much for retirement as they should, and attain the retirement lifestyle they envisioned.

They also may need to change course in order make ends meet. Around half of working people in the survey said they expect to find a job that pays more, reduce spending on necessities, or dip into their savings because of the increasing cost of living.

Because of the rising cost of living, have you had to, or do you expect to, do any of the following … the general numbers look like this:

- 53% “Find a job that pays more money”

- 52% “Reduce spending on necessities, like housing and food”

- 49% “Dip into my savings to make ends meet”

- 45% “Stop saving or reduce saving for retirement”

- 52% “Stop saving or reduce saving for my children’s college education”

Annuity Pros can determine if actions like stopping or reducing saving for retirement are necessary and can help clients think through the short- and long-term consequences. They can also assist in creating a strategy that factors in the risk of inflation to retirement savings.

Retirees have fewer that can help mitigate the risk inflation presents to retirement savings.

Guidance from Annuity Pros can support retirees who are worried about inflation and help them identify steps such as using annuities to protect their retirement income and address inflation risk.

Individuals and businesses who would like to connect with Annuity Pros can get in touch instantly via our enquiry form.

Annuity Products

Life Insurance Products

Get Started Now