Are there any good ways to save for retirement that do not involve the potential risk associated with the stock market?
Answers | 2
Erin, you are asking a great question and I have an excellent answer for you. Yes, there are. I'd want to know what age you are and what your retirement goals are in order to give you better advise but I can share some examples with you first. There is cash-value life insurance that will do several things: 1) Allow you to store your cash in the safest place possible along with earning a guaranteed minimum interest crediting rate as well as dividends - all tax-free growth and access under current tax laws, 2) Allow you to access those funds as you need whenever you want in order to take care of emergencies, invest in other opportunities, such as Real Estate, pay off debt to save on interest, etc. all at any time and well before 59 1/2, and 3) Give you permanent death protection for your family. The options you have with this tool are too numerous to name here. Another option is to put funds into an annuity - again, you get guarantees on interest rates as well as access to lifetime income that is guaranteed. There are other options as well but the foundation of these vehicles will allow you to do other things with that money without worrying about losing your precious capital and time to make up the loss. Let me know if I can help you in more detail.
Hi Erin. Paul's answer is a good one. I'd approach the conversation with you from a slightly different perspective, however. I'd like you to tell me what your perception of risk is with respect to the stock market. What potential risks do you see, and how do you perceive those risks impacting YOUR financial plans? I'd also take some time to educate you about the potential risks on NOT investing your retirement savings into stocks. The products that Paul mentions are good, as are some of the strategies in using those products. But, like every investment product/strategy, they are not without their deficits. Since you are asking the question that you are asking, I'd strongly advise you to seek the council of a fee-based, fiduciary financial advisor. Good luck with you retirement planning!