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Don’t Make Big Financial Decisions When Things are Stressful

When it feels as if the world is spinning, it’s important that you remain skeptical of promises of sure things. Is a simple and reliable investment really simple and reliable, or does it just appear that way during complicated times?

“As Russia launches its blitzkrieg against Ukraine, my inbox brimmed with reports from investment firms on what you should do next,” says stock market analyst Jason Zwieg at the Wall Street Journal. Additionally, Zweig warns that Russia’s aggression has led to uncertainty, which has raised rates in such a way that “The U.S. economy may be too frail to withstand.”

Major indexes such as the S&P 500 may have recently recovered from the dip that occurred alongside the invasion of Ukraine. As a result, many people have suddenly decided it’s a safe time to invest. Oil prices are nearing $100 a barrel. However, there isn’t really any way to predict changes in the market. This is because there’s no way to predict changes in the geopolitical climate. For example: In August of 2001, the Federal Open Market Committee stated they’d be raising rates soon. But then, after the September 11th terror attacks, they dropped rates by %1.5 in less than two months. To quote Jason Zweig again, “Investors who overhaul their portfolios based on what the Fed seems likely to do could get stranded if it does something else entirely.”

Not Many Things are Certain

In recent months, a number of professional investors have started redistributing their holdings. This is done in attempts to cash in on rate changes made by the Fed. Many believe these changes are inevitable to come. However, it may be unwise to take aggressive risks during uncertain times such as these.

Now that Russia has attacked Ukrain, emotions are running high. You may be tempted to make an investment that feels completely sure, in order to provide more financial stability. However, hastily made decisions are often wrong. Maybe you’re going to try and reconstruct your portfolio based on your predictions about the market based on current events. For example, a boom in the U.S. exports of natural gas, or higher military spending. The risk, however, is that those scenarios often don’t materialize. To quote Zweig again, “And, even if they do, they can become too popular, eliminating the bargain prices that produce superior returns over time.” So, what if there was an alternative to stock market investments? Well, we may be able to offer one.

We Might Be Able to Help

Jason Zweig’s article goes on to suggest that, while you shouldn’t make risky investments at this time, you shouldn’t overhaul your portfolio, either. However, we may have some information that could benefit you. If you’re struggling to manage your investments right now, and unsure of how to keep your money safe, you aren’t alone. There are products available right now that can get you income based on the growth of a stock market index, without directly investing in the market. Fixed indexed annuities may be an option worth considering.

A fixed indexed annuity (or FIA) for those unaware, is a contract issued by an insurance company. First, you contribute a certain amount of money to the annuity. Then, an accumulation phase begins. During this phase, that money increases based on the performance of an index, such as the S&P 500. However, in the event of a stock market dip during this phase, you aren’t at any risk of losing that money. Your principal is protected, backed by the insurance company’s claims-paying ability.

Another benefit offered by an FIA is the income generated being tax-deferred. An FIA is an insurance product, and, as a result, doesn’t apply to the same tax rules as other types of savings accounts.  Additionally, you can select an income rider, so that the money in your FIA grows to compensate for inflation. Also, an FIA comes with a death benefit that does not go through probate.

When trying to save money for retirement and for your beneficiaries, safety is important. And it’s even more crucial during times like these. Even if you believe a stock market investment is safe, at least a portion of your money should be kept in risk-free accounts.

35% Bonus

Additionally, some annuities come with bonus options. Some of these bonuses happen during the first 12-18 months. Others only kick in after a certain number of years.  The reason we bring this up is that, right now, for a limited time only, one of our annuity products is offering a 35% bonus. For every $100k contributed to your annuity, $35K will be added to your retirement and wealth benefit. This could be an incredibly beneficial feature for you if you purchase an annuity as a part of your retirement strategy.

Are you looking for more information about annuities, and how they may be beneficial to you? Safety and security are important qualities in a financial vehicle. This is especially the case if you’re trying to save money for retirement. Even more so during difficult and uncertain times like these. Reach out to us for more information. You can schedule an appointment with us, or attend one of our seminar events. At these events, we’ll talk more about FIAs and how they differ from stock market investments. It’s possible that we have the key to your future financial security.

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