A ​​Goals Based Approach  |  Investments  | Retirement Income Planning

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No one knows for certain when interest rates will rise or fall, or if they will remain stagnate and flat for years to come. Income Ladders, in essence, are somewhat analogous to dollar cost averaging in stocks.

Income Ladders are designed for various situations - depending upon whether you are trying to solve for current income needs now or future income needs later. Depending upon your unique situation, Green Pastures may build Income Ladders as part of your investment and retirement income portfolio.

While Income Ladders aren't for everyone, they are a great transfer of risk solution that specifically solves for income and principal protection (and tax-deferred growth in some situations).

If you need to solve for one of these items, then you may want to consider adding an Income Ladder to your investment and retirement income portfolio.

Income Ladder Summary

If you need to plan for retirement income and lifestyle gaps or shortfalls (a) immediately, (b) during some fixed period in the future, or (c) for your entire retirement, Immediate Income Annuities ("SPIA") and Deferred Income Annuities ("DIA") allow you to lock in guaranteed lifetime income streams - and help simplify your future financial life.

Immediate Income Annuity and Deferred Income Annuity payments are based on your life expectancy at the time you start the payment stream - so the later you start, the shorter your life expectancy, which in turn increases the payout.

Guaranteed Lifetime Income Annuity Ladders may ladder Immediate Income Annuity and Deferred Income Annuity payment start dates for you depending upon your unique situation and needs.

For example, you may want to stagger receiving higher amounts of guaranteed lifetime income after you retire, when you will no longer receive a monthly paycheck from your employer and, in addition, your risk tolerance for stock market volatility and Sequence Of Returns Risk lessons.

Guaranteed Lifetime Income Annuity Ladders can ladder Immediate Income Annuities and Deferred Income Annuities for you so you have guaranteed lifetime income streams starting now, in five, 10, 15 years, etc. - and you will know to the penny the exact guaranteed lifetime income amount for each specific start date.

Guaranteed Lifetime Income Annuity Ladders

Similar to CDs that pay a fixed rate of interest for a set period of time, Multi-Year Guarantee Annuities ("MYGA") are simple to understand and pay you a guaranteed annual fixed rate of interest for the entire contract period.

 
The primary functional difference between a MYGA and a CD is when a MYGA is held in a non-qualified account (for example, assets held in an individual or joint account) - you don't pay taxes on the interest until the money is withdrawn - so your interest can grow and compound tax-deferred. With a CD held in a non-qualified account, you have to pay taxes on the interest annually.

MYGAs are offered in various time frames - typically for as short as three years and up to as long as 10 years - and pay different interest rates. Similar to most fixed income instruments, MYGA rates are impacted by interest rate cycles.

Depending upon the interest rate environment, Multi-Year Guarantee Annuity Income Ladders may stagger the time period of maturity, as well as interest rate earnings, of several MYGAs for you. The proportion of allocation will typically depend upon your age, your time frame of needed cash flow, and the interest rate spread between the various time frames.

For example, if interest rates appear to be moving in an upward direction, we may recommend an allocation into shorter-term durations (for example, a MYGA Income Ladder with three, four, and five-year surrender periods). Then, as the MYGAs mature, you can exchange the values into other MYGAs that will hopefully coincide with locking in higher interest rates for you at that time.

Conversely, if interest rates appear to be moving in a downward direction, then we may recommend an allocation into longer-term durations (for example, a MYGA Income Ladder with six, seven, and ten-year surrender periods) to lock in higher interest rates for you.

Tax-Deferred Multi-Year Guarantee Annuity Income Ladders

Income Ladder Solutions can be designed for various scenarios depending upon whether you are trying to solve for current income needs and/or future income needs.

   Income Ladder Solutions