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Although, I still have another 20+ years before I reach traditional retirement age, I’ve been thinking a lot lately about retirement planning. Now I know that some people believe that you shouldn’t save for retirement until after paying off all your debts. However, considering the low interest rates on my loans and my company contributions, I’m okay with saving for retirement at this point.

Currently, I’m contributing to my 401K, ROTH IRA, and Health Savings Account (HSA). But I want to do more to help put me in a position of comfort and having options during my retirement years. Recently, someone offered to sale me an annuity… 🤨I must admit that I am naturally skeptical about pretty much everything, until I’m convinced otherwise (don’t judge me).

At first mention of purchasing an annuity I couldn’t see any reason to even consider such a thing. But, in all fairness I continued to research the product. While I may initially give something the side eye, I’m still open to learning more, to possibly change my stance.

An annuity is a contract, sold by an insurance company that promises to make monthly, quarterly, semiannual, or annual payments for life or for a specified period of time. The thought of having guaranteed income does sound amazing, but at what cost? There are different types of annuities that include various fees (some not so obvious).

Also, another thing worth mentioning is that annuities are not FDIC insured. Therefore, if you’re considering purchasing one, make sure it’s through a reputable company.

During my research, I came across the U.S. News article 15 Things You Need to Know About Annuities. I would recommend this article to anyone seeking to better understand annuities. It provides detailed information and examples, in simple everyday terms.

So, after reading several books and articles and listening to a few podcasts and YouTube videos, my feelings about buying an annuity haven’t changed. At the moment, I’m leaning toward a bond or cd ladder as a means to provide additional income in my latter years.

What are your thoughts about annuities?
How are you preparing for retirement?

“By failing to prepare, you are preparing to fail.” ~Benjamin Franklin