Annuities?

[Jstpssng]

Never understood why people come to forums such as this for financial or medical advice.

My suggestion is to seek out a reputable financial advisor and discuss your needs. Make sure such advisor is not strictly a annuity salesman. Some annuities have very high fees that are not apparent on the surface. Some annuities have cash value you can pass on to your heirs when you pass, others don't. Lot's of variables. Yes, my financial advisor also charges fees, but they are very reasonable and he has made me money to the extent his fees are complete justified.

I've learned a lot from reading this type of discussion here. Unlike a financial advisor, members here aren't paid and give advice based strictly based on experience. I'm not about to run out and do as somebody suggests, yet do come up with some good questions to ask.
Based on another discussion, I am going to talk to my 401K plan manager about putting future contributions into a ROTH, rather than conventional account; something I never even considered until reading about it on TBN today.

 

[ovrszd]

No worries. I'm getting to the point where I may find out who wants what on my guns and sell off the rest. Sooner or later, depending on my MIL, we are going to be downsizing the house and land.

Ironic, we bought the place with 8 acres and an option to buy an additional 30. We took the option to buy the additional 30 acres. Since I don't farm, the land was nice to hunt and shoot on, but honestly from year 8 through year 15 of owning the place, we kind of regretted on taking out the loan on the additional land. Now that the land has been paid off, I'm thinking it was most likely one of the best investments we made to keep some options open.

Down the road when we sell, will subdivide the land into two parcels. This side of the creek (house side) with 17 acres, the other side of the creek where the blind is at with 20 or so acres. We will most likely keep the land on the other side to see if we want to build something smaller there or not.

We've been in NC for 21 years now, not certain when we retire if we'll further west or not.

I've got a real good friend who owns tens of thousands of acres of land. That's how he's invested every dime he has accumulated over the past 40 years. Might be the thing to do with the investment resources you have. After all,,,,, they don't make no more land.

Harrison County is a rather large County here in Missouri. Land owners are from 11 different countries. A guy from Florida is buying the 40 next to me.

Missouri land seems cheap for investors from higher cost of living areas.

 

[M59]

Anyone invest in annuities?

I work with Northwestern Mutual on an old 401K from an old company and have a couple of whole life insurance plans. I like the guy I work with (always talk to him on the phone as he's two hours away from me).

Sigarms,

First of all. Excellent member ID. They make high quality tools and stand behind everything they make.

I would strongly suggest you interview FEE ONLY investment advisors as they charge a fee for investment advice and never earn a commission by selling a product. They have ONLY your best interest in mind.

What ever you place your investment money into, you must always consider length of time till its needed and willingness/ ability to tolerate risk. I would never say whole life and annuities are wrong, I would only say they are wrong for me for the following reasons:
Annuities typically pay 100% of first year as comission to selling agent ( OUCH ) and then a declining rate rate for next 5 years. Whole life is very similar.

Both annuities and whole life will always generate lower payments than the average long term ( 10 year ) of the S&P 500 as what the sellers are actually doing is investing your money into equities and other instruments and paying you a substantially reduced safe amount and they pocket the expected profit on the differential between market return and what is paid to you.

Best wishes and profitable outcomes in your search

 

[Sigarms]

I've got a real good friend who owns tens of thousands of acres of land. That's how he's invested every dime he has accumulated over the past 40 years. Might be the thing to do with the investment resources you have. After all,,,,, they don't make no more land.

Harrison County is a rather large County here in Missouri. Land owners are from 11 different countries. A guy from Florida is buying the 40 next to me.

Missouri land seems cheap for investors from higher cost of living areas.

I'm certain you over estimate my "investment resources"

Sometimes it's just nice not to have to live paycheck to paycheck and being debt free.

Thing is, when I was younger, I never thought "long term" (honestly I figured I'd be dead by the time I hit 30).

Coming up to age 60, and need to start some kind of game plan other than me and the misses 401K's.

Funny, always thought I hated Missouri, never heard anything good about that state from guys who went to Ft. Leonard Wood. Living in in the western part of NC now for 20 plus years (still about 90 minutes east of M59), I know it's kind of like judging NC by living in Fayetteville NC.

 

[Sigarms]

Both annuities and whole life will always generate lower payments than the average long term ( 10 year ) of the S&P 500 as what the sellers are actually doing is investing your money into equities and other instruments and paying you a substantially reduced safe amount and they pocket the expected profit on the differential between market return and what is paid to you.

Thank you for that explanation, makes sense and what I figured in a long about way.

I joke with my wife, for the best return on investment, we should just grow 100% pure weed that isn't laced with anything. Other idea (and more legal) would be to buy a pallet of R410A now. When I think to the 90's and what a drum of R22 was going for, I could have invested in freon and become a rich man selling it under the table (as I said, "more legal"). That said, I'm old enough and into a career I play by the rules now LOL Keep in mind, last paragraph is nothing more than a bad joke.

 

[Sigarms]

I've learned a lot from reading this type of discussion here. Unlike a financial advisor, members here aren't paid and give advice based strictly based on experience. I'm not about to run out and do as somebody suggests, yet do come up with some good questions to ask.
Based on another discussion, I am going to talk to my 401K plan manager about putting future contributions into a ROTH, rather than conventional account; something I never even considered until reading about it on TBN today.

BINGO!

 

[M59]

I've learned a lot from reading this type of discussion here. Unlike a financial advisor, members here aren't paid and give advice based strictly based on experience. I'm not about to run out and do as somebody suggests, yet do come up with some good questions to ask.
Based on another discussion, I am going to talk to my 401K plan manager about putting future contributions into a ROTH, rather than conventional account; something I never even considered until reading about it on TBN today.

Jstpssng,

I presume when you indicate "conventional" account you mean IRA. The IRA vs Roth IRA is a play that depends on several factors including your current and future expected Federal tax bracket. IRA is a pre tax instrument and Roth IRA is a post tax instrument. IRA withdrawals are taxed as earned income in the future when you withdraw the money. Roth IRA money is taxed at existing Fed tax rate and grows tax free when you withdraw. The decision to choose IRA or Roth is dependent upon Fed rules. If you make too much money then you are excluded from Roth contributions. I don't know what current limit is but it used to be $150K. Link to rule: ( New income ranges for IRA eligibility in 2021 | Internal Revenue Service)

IRA's also have downside of RMD / Required Minimum Distribution which start at age 72 and RMD percentage increases each year. Effectively forcing the IRA owner to deplete the IRA and benefiting the US govt by collecting income taxes each year. Roth IRA have no RMD.

The rule of thumb when deciding whether to choose IRA vs Roth IRA is whether you are currently in lower or higher tax bracket now than when you retire. For example. If you make $84-178K now and can live on $83K a year then go pretax IRA at 22% bracket and withdraw it and pay taxes in 12% tax bracket. This all based on Fed tax brackets during your earning years vs income needs and tax brackets in retirement years.

Now the interesting part. You make $650K a year and are denied the Roth IRA so you go pretax IRA and get a 37% tax break. Then you do what is known as Mega Roth roll where you take money out of IRA at amounts that don't exceed the 22% tax bracket. You just had your cake and ate it too by avoiding 15% in taxes. Fed govt caught on and are eliminating this play in 2032.

Peter Thiel, who owned a portion of Paypal, dumped ALL his ownership of Paypal, a few thousand dollars, into a Roth. Thiel's holding, as Paypal became more valuable, is now currently valued at $5 BILLION dollars and ALL tax free.

Fun times.

 

[Jstpssng]

^^^^^
Actually, I meant ROTH 401k. I don't know much about them, but after reading this thread I realized I need to look into them.

 

[M59]

^^^^^
Actually, I meant ROTH 401k. I don't know much about them, but after reading this thread I realized I need to look into them.

The Fed tax bracket of 22% is tipping point for whether to decide to go IRA or Roth IRA. In early income earnig years when making less than $83K then it makes sense to go direct to Roth since tax break is only 12%.

Like I said Fun Times. "Progressive" tax code keeps accountants and retirements advisors in the land of clover and honey.

 

[3Ts]

When deciding on whether to invest in a 401K or a Roth IRA or any other similar style of investment, check to see if your employer will match the funds that you put into it. I've had employers that will match anywhere from 25% to 100% of what you put in.