The debate will rage on as long as we invest our money. Are there better investments than annuities? What are the best annuity rates? What are the best stocks for long term growth? The questions are a bit more complex than that so lets take a look. Stocks seem to be the darlings of the investment world and with good reason. A properly designed portfolio can appreciate rapidly. It can also lose value just as quickly. If you are aged 25 at the time, those drops may not concern you. Mutual Funds while not quite as volatile in most cases can and do lose value as well. Investing log term can smooth out some of these downturns in the market. The issue becomes your investment strategy and risk tolerance. Most people have a hard time doing that and that is one reason many choose annuities as an alternative. While the rate of return is higher with stocks and mutual funds annuities offer stability and preservation of investment capital. The formula for investing is very simple. Higher return equals higher risk. How one distributes their investment dollars is the key and balancing your portfolio is the answer.
Lets assume you want to take advantage of the higher return rates that stocks may offer. Your broker has told you of a company and their fundamentals look strong. Their projections and forecast look for a significant appreciation. There is absolutely no reason you can find not to buy the stock. What do you do? .
On the other hand you find a safe secure index annuity that wont pay as much in return as the stock but your principal is protected and guaranteed. It is a dilemma every investor is faced with and one you must decide for yourself on how to settle.
Talking with your financial adviser will help. Balancing a portion of your investments towards the safe and security of index annuities and a portion or percentage in growth stocks might just be the right might for you. The investment in index annuities will smooth out the rough spots and you will reach your retirement with a nice nest egg and not wondering what might have been. There is nothing wrong with investing in annuities in and of themselves. There is nothing wrong with investing in stocks. The combination between the two, guarantees as safe, secure future in your glory years
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