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Everyone knows  that interest  rates have been  extremely low for over 3-4 years.  It's part of  the the Federal Reserve Banks plan to "help the  economy". Even with the  slight  increase in interest rate in the past week or so it is still almost impossible to  earn a decent yet safe rate of  return on  our
money.

Did  you  know  that it is possible to obtain a 6% guaranteed interest rate on a 96 month financial product. There are minimum purchase amounts of $40,000 - 60,000 with a maximumum of approximately $250,000. These are not liquid but you do  receive monthly payments including but some return of principal and  interest. Payments are level  throughout the 8 year term. The interest rate is guaranteed at time of issue and payment of the contract. There is also a high  degree of  safety with this type of contract. This is what I would consider a Safe Money product with no stock market risk. They are compatible  with a ROTH or Traditional IRA or can be used with non qualified money as well.

I think it is good  to  know that a reasonable Bank alternative is available today.  Why would anyone  want  to put that amount of money in a bank anyway?

What Happens to Bonds When Interest Rates Rise?

This  weekend an interesting  article appeard in the  Columbus Dispatch in the business  section. It was  titled "Bond-Lovers still buying despite risk, stock highs." In a recent month investors put $32 Billion into Bond  Mutual Funds.  This becomes a potential issue when interest rates are at all time record lows.  Do  you  think that interest rates one, three  or five years from now will be lower  or higher than  they  are  today?  Can they  get much lower?  Can they get much higher?  Is there  upside interest rate risk?  What happens to  existing values when  rates are rising?  Simple economics answers that question.   Existing prices fall when interest rate rise. The article  further states "With Bond prices rising and interest yields at historic lows the risk has picked up significantly"  The article is  worth  reading!

When customers wish to minimize their risks  Safe Money products might be a logical part of a financial portfolio.  Asset diversification is always very important.

Did you know that there are products that can guarantee lifetime income without any market risk?

I'm not telling anyone  to  buy  something or  to  sell  anything.  I'm just sharing  a nice article worth  reading.

How much money can you spend in your retirement

Most Professional Financial Advisors use a Rule of Thumb called  "The 4% Rule". Rules help clients understand what they  should or should not do. This rule states that if you  want a high probability that your  retirement assets will last as long as you live you should  remove or spend no more than 4% of your assets per year.  This rule applies  to self managed money accounts and  does not apply to Defined Benefits assets.  Recently we have lived through 5 or more years with Low interest rate earnings, High market volatility and we are actually living longer than ever in history. A number of  economists and planners have asked and studied this question. "Does the 4% Rule still apply in todays world?" What a great question! Many financial Advisors now believe that it no longer provides adequate protect of your income for life. They believe that you should limit withdrawals to only 3 % or so if you  want your self managed assets to last for your lifetime.

A recent study that appeared in the Journal of Financial  Planning  has found that up to 18% of people utilizing the 4% Rule will in fact run out of money before they die. That is a terrifying study result! That means that many people will have  to work long and or spend less in their retirement years.

What should a retired boomer, retiree or pre-retiree do.  They can  decide to  work longer and spend less. Those are a couple of good steps. Clearly they should also convert at least some portion of their assets into a Lifetime guaranteed income stream. These products  are only available  from Licensed Life insurance agents with the products  and knowledge needed to meet  these needs.  This is what I have  focused my business on for  over 8 years. Some of  these products can Guarantee a withdrawal rate for  life of 5% or more for your  entire lifetime.  Now compare that to  the 4% Rule or maybe 3-3.5% withdrawal rate with self managed assets.  These products can guarantee you an income 25-66% more than you  can  get from any self managed assets with the same Asset value. Thes products do this with Zero Market Risk. They delivered during 2008-2009 and they  can do the same thing during the next  recession whenever the out of control goverment excess spending creates the next Recession. These products have a role to play in almost everyones retirement strategy.