Goals Based Investing | Retirement Income Planning | Annuities
G R E E N P A S T U R E S W E A L T H M A N A G E M E N T
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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. The Income Ladder Solutions are designed for various situations - depending upon whether you are trying to solve for current income needs now or future income needs later.
We believe the best way to use the Income Ladder Solutions is in conjunction with your investment portfolio. Green Pastures complements the investment management programs with the Income Ladder Solutions to help construct part of your retirement income portfolio.
While the Income Ladder Solutions aren't for everyone, they are great transfer of risk solutions that specifically solve for income and principal protection. If you need to solve for one of these items, then you may want to consider adding an Income Ladder Solution to your investment portfolio.
To learn how to put Green Pastures Income Ladder Solutions to work, email lee@greenpastureswm.com.
Summary
If you need to plan for retirement income and lifestyle gaps immediately, or during some period in the future, Immediate Income Annuities and Deferred Income Annuities allow you to lock in a guaranteed lifetime income stream - 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.
The Guaranteed Lifetime Income Annuity Ladder Solutions may ladder Immediate Income Annuity and Deferred Income Annuity payment start dates for you. 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 may lesson.
For example, Guaranteed Lifetime Income Annuity Ladder Solutions could ladder an Immediate Income Annuity and Deferred Income Annuities for you to have guaranteed lifetime income streams for you 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 Ladder Solutions
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, the Multi-Year Guarantee Annuity Income Ladder Solutions 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/transfer 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.
Multi-Year Guarantee Annuity Income Ladder Solutions
The Income Ladder Solutions are designed for various situations depending upon whether you are trying to solve for current income needs or future income needs.
Building Income Ladders
Income Ladder Solutions
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