Category Archives: Retirement / Savings Plans

What is a Variable Annuity?

An annuity is a stream of income.  A purchaser makes periodic or one-time payments during the “accumulation phase” of an annuity so that at some point in the future they can trade those payments in for a stream of income.  The aspect of an annuity which makes it “variable” as opposed to “fixed” is the fluctuating performance of the sub-accounts which they invest in.  Typically, annuity sub-accounts are invested in mutual fund-like holdings which can own stocks, bonds, and alternatives.   The total contract value of your annuity will vary depending on the performance of the underlying investments. There is a lot of chatter about the positive and negative aspects of investing in variable annuities because of their complexity and potential expense.  I will explain further below:

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How to Rollover Your 401k

Pat yourself on the back if you’re leaving a job and have questions about your 401k. If you do, at some point you took the time to establish a 401k account at work. By doing so, a portion of your pay was directed into a tax-deferred vehicle which allowed you to accumulate funds, presumably for retirement. You didn’t have to save through the 401k, but you did because you either understood its benefits, or heard it was a good idea. Continue reading