Fred Goldenberg: It’s all about peace of mind | Business






Fred Goldenberg


I have been involved in the investment business for a long time. For the past two decades, I have focused on helping people use “safe” places for money. Make sure the nest egg they have is safe and secure.

But once in a while, I run into this independent investor who insists he has a foolproof system that beats the market. They show me their spreadsheets, their Excel files and, like a guy who handicaps horses at the racetrack, their list of infallible winners.

As they explain their system I can see how excited they are and how addictive it is that almost becomes a full time job just to maintain. For them, everything makes sense.

You know who that doesn’t make sense to? Their spouse.

For a market junkie, spending countless hours analyzing companies that seem ripe for growth is exhilarating. They understand how their system works and can change it on the fly. What they don’t understand is that it’s their system. For most, if they predeceased their spouse, the system would be pure gibberish and indistinguishable.

When I report this, I get responses like, “It’s not that hard, he/she will be fine” – while the spouse sits there shaking their head.

That’s why, when I read Jim Cramer’s interview, host of CNBC’s “Mad Money with Jim Cramer,” in the December 2021 AARP newsletter, I felt vindicated in my crusade to help people adjust their investment outlook to a more understandable and portable option.

Asked about his current personal investment portfolio, Cramer spoke about his past investment strategies – and then his current investment journey: “But when I turned 65, I cut that in half. Before, I had almost no cash, so now I have 40% US stock index funds, 5% international stocks, 5% split between gold and cryptocurrency. of my money is cash.

Why this sudden reversal? Because his wife said, “What if I survive you?” I don’t want to feel like I’m in trouble – that I had a lot of money, and that somehow, because my crazy husband decided to let it all roll, I don’t do not do. And she continued, “Jim, what I’m really talking about is peace of mind, and thank you so much for giving me peace of mind.”

Although Mr Cramer did not specify where he hid his money, we can assume it is not in a passbook savings account earning 0.06% – which is the current national average yield.

I’m going to guess it’s in a fixed indexed annuity. FIA stock comes with fixed deferred annuities, but annual growth is pegged to a stock market index (eg, NASDAQ, S&P, Dow) rather than a fixed interest rate.

This gives Mr. Cramer the ability to search the indexes and allocate them to his heart’s content. Mrs. Cramer is happy to know that with this type of annuity, the insurance company bears the risk of a sharp decline in the stock markets. You cannot lose any of your principal with a fixed index annuity. Hence the peace of mind.

Beyond peace of mind, there are several reasons why you should consider a fixed index annuity:

  • Earn compound income while deferring income tax
  • Earn higher interest rates than bank CDs
  • Make contributions to your tax-deferred account
  • Protect your capital from downturns in credit markets
  • Early retirement without penalty
  • Meeting Required Minimum Distributions (RMDs)
  • Retire with lifetime income
  • Create an inheritance without probate

I know right now all the market junkies reading this are clutching their chests and saying, “Rentes? Never.” They spray every anti-annuity cliche every stockbroker has ever uttered.

Yet here is your guru – the man himself, Jim Cramer – saying cash is king.

Yes, I am the one suggesting that it is a good strategy to use the FIA ​​to achieve this goal. Honestly, I can’t think of anything else that fits the bill.

The point is, AIFs give you the ability to satisfy your urge to control the investment – ​​and give your spouse the peace of mind that no matter what tomorrow brings, the money will still be there.

Fred L. Goldenberg is a Certified Senior Advisor (CSA) and owner of Senior Benefit Solutions, LLC, a certified health insurance and financial services organization, now affiliated with Michigan Planners, in Traverse City. Questions or comments regarding this column or interest in our monthly Medicare classes can be directed to (231) 944-1400 (option #1, option #5) or [email protected]


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