​More Americans than ever are including annuities in their retirement planning. According to the Limra Secure Retirement Institute, there were more than $132 billion in fixed annuity purchases in 2018. That’s a 25 percent increase over the previous year and an all-time record.1
 
Fixed annuities are retirement income vehicles that allow you to earn tax-deferred accumulation, often with some kind of downside protection. For example, you might earn a fixed interest rate over a set period of time. Or you could have the potential to earn interest based on the performance of an external market index, like the S&P 500.
 
Why have these vehicles surged in popularity? It often depends on a person’s specific retirement income goals and needs. However, there are a few common factors that could make a fixed annuity appealing for someone who is approaching retirement.

Volatility 

So far in 2019, the S&P 500, which is a broad-based index representing American stocks, is up more than 20%. However, that hasn’t come without some sizable ups-and-downs, including a market downturn over the summer.2
 
If you’re nearing retirement, you may not be as comfortable with those “ups-and-downs” as you were in the past. It’s natural for people to grow less comfortable with risk as they get older. After all, if you’re retiring soon, you don’t have as much time to recover from a loss as you did when you were younger.
 
Most fixed annuities offer some level of downside protection, such as a principal guarantee*. While you may not earn as much as you would in the market, you also aren’t exposed to downside loss. You simply earn interest based on the terms of your contract. If the market goes down, your premium doesn’t. A fixed annuity can often be a stable portion in an overall allocation.

Guaranteed* Income 

Many fixed annuities also offer guaranteed* lifetime income features that can give you certainty and predictability in retirement. For instance, in many of these benefits you’re allowed to withdraw up to a certain percentage of your value each year. As long as your withdrawal stays within the limit, your income is guaranteed* for life, no matter how long you live or how the annuity performs in the future.
 
Many retirees can only rely on Social Security or possibly a defined benefit pension for guaranteed*, predictable income. An annuity with a lifetime income benefit can provide an additional source of guaranteed* income in retirement.

Tax-Deferral 

Growth in fixed annuities is tax deferred. You potentially earn interest each year, but you don’t pay taxes on that growth as long as the money stays in the annuity. That deferral could help your assets compound at a faster rate than they would in a comparable taxable vehicle. You eventually pay taxes on the growth when you take withdrawals or when you pass away.
 
Ready to evaluate your retirement strategy? Let’s talk about it. Contact us today at Thomas Financial. We can help you develop and implement a plan. Let’s connect soon and start the conversation.
 
 
1https://www.investmentnews.com/article/20190220/FREE/190229989/fixed-annuity-sales-smash-previous-record
2https://money.cnn.com/data/markets/sandp/
 
Licensed Insurance Professional. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional.  The statements and opinions expressed are those of the author and are subject to change at any time.  This material has been prepared for informational and educational purposes only.  It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy.
 
19436 - 2019/10/28

It’s the scariest time of year. Halloween is here again. It’s time to stock up on candy, carve your pumpkin, and find the perfect costume. This may be the season for ghouls and goblins, but there could also be terror lurking in your retirement strategy.
 
More than 50% of Americans say their number-one financial concern is not having enough money for retirement.1 It’s a valid concern. Retirement is a substantial financial need. It can be challenging to accumulate enough money to fund a long, stable retirement.
 
Fortunately, there are strategies that can take some of the terror out of retirement uncertainty. Below are three common retirement concerns. They can all be addressed with one optional shared strategy—a fixed indexed annuity (FIA). If you share these retirement concerns, you may want to consider how an FIA can fill the gaps in your income planning.

Market Volatility 

Nothing can derail a retirement income strategy like a market downturn. You’ve worked your entire career to save and accumulate assets. A decline just before retirement could reduce your nest egg and limit your ability to generate income.
 
A fixed indexed annuity can help you reduce your risk exposure. In an FIA, you have the potential to earn interest based on the performance of an external market index. If the index performs well, you earn more interest, up to a limit. If it performs poorly, you may earn little or no interest.
 
However, most FIAs have a principal guarantee*. That means that even if the index declines in value, your annuity value will not go down. You can’t lose any premium due to market risk. An FIA could help you achieve growth while reducing your risk exposure.

Unpredictable Income 

Where will your income come from in retirement? It’s an important question. Unfortunately, too many retirees can’t answer it. Social Security will provide some level of income. Perhaps you’re lucky enough to have a defined benefit pension.
 
The rest of your income may come from your savings and investments. However, that income isn’t guaranteed* and may not be predictable. After all, if you suffer a loss in the markets, your income could go down as well.
 
You can use an FIA to help manage this risk. Many FIAs have optional guaranteed* withdrawal benefits. You’re allowed to withdraw a certain amount each year. The withdrawal is guaranteed*, which means you can take the same amount regularly, regardless of how your annuity performs. That kind of predictability can help you make informed financial decisions throughout your retirement.

Running Out of Money 

It’s possible you could spend 30 years or more in retirement. That’s a long period of time to make your assets last. If you don’t watch your spending in the early years, it’s conceivable you could run out of money by the end of retirement.
 
Fortunately, an FIA with a guaranteed* withdrawal benefit lasts your entire life, no matter how long you live. As long as you stay within the income limits, your income will last your entire life. Again, that could provide much-needed certainty to help you meet potential financial challenges in the later stages of retirement.
 
Ready to take the terror out of your retirement strategy? Let’s talk about it. Contact us at Thomas Financial. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.
 
1https://news.gallup.com/opinion/polling-matters/260570/despite-economic-success-financial-anxiety-remains.aspx
 
*Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
19291 - 2019/9/23

According to a recent survey from Policygenius, only 32% of Americans own life insurance.1 Life insurance provides financial protection, especially for those with children or other dependents. Life insurance provides a tax-free lump sum benefit that can be used to cover a wide range of expenses and financial challenges.
 
Life insurance is a valuable tool for many Americans, but it can be important for small business owners. In many small businesses, the owner wears multiple hats. You may be the CEO, but also a salesperson, a manager, a bookkeeper, and much more. If the owner passes away, the business could suffer a major loss, both financially and operationally.
 
Fortunately, you can use life insurance to minimize your risk and protect your business and your family. If you don’t have life insurance or don’t have enough, now may be the time to explore your options. Below are a few ways you could use insurance to protect your family in the event of your death:

Provide the business with liquidity and cash flow. 

It’s never fun to think about death, but it’s also too important to ignore if you own a business. Imagine what might happen if you were to unexpectedly pass away. Would your business continue to run seamlessly? Or would it face major disruption? Who would run the business?
 
Life insurance can give your family and your business much-needed cash to keep the business running while they address those questions. They can use the cash to pay bills, make payroll, and maintain operations until they develop a strategy for how to move forward.

Compensate your family and protect your partners. 

Do you have a business partner? Or even multiple partners? An unexpected death can create chaos in a business partnership. On one hand, your partners may be able to assume your responsibilities and keep the business afloat.
 
On the other hand, your partners may also want to take over your share of the business. You’ll likely want your family to be compensated if that happens. Life insurance can provide funding to facilitate that transaction.
 
You and your partners can all buy life insurance policies on each other. If you pass away, your partners receive the death benefit. However, you use a contract called a “buy-sell agreement” to dictate what happens with the benefit. For instance, your agreement may state that your partners use the proceeds to buy your share of the business from your family. Your loved ones receive compensation and your partners are able to keep the business running.

Avoid liquidation or other undesired outcomes. 

Assume you pass away and you don’t have partners or a family member who can step in and run the business. What happens? Your survivors may have no choice but to fold up shop and sell the business. In fact, if you have outstanding debt, your creditors could foreclose and liquidate your business’s assets.
 
Life insurance helps your heirs avoid that situation. They can use the proceeds to pay off debts and meet financial obligations until they can find a buyer or other suitable outcome. That can prevent liquidation and help them get fair value for all your hard work.
 
Ready to protect your business and your family? Let’s talk about it. Contact us today at Thomas Financial. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
1https://www.policygenius.com/blog/many-americans-are-underinsured/
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
19300 - 2019/9/24

What’s your plan for your estate after you pass away? Do you have a will or trust? Have you discussed your goals with your children or other heirs? Or do you lack any estate planning documents?
 
If you haven’t yet planned your estate, you’re not alone. Nearly 60 percent of Americans lack a will, one of the most basic elements of any estate plan. ¹ A will is a simple and affordable document that lists who should receive which assets in your estate after you pass away.
 
There’s one other important basic component in any estate plan. It’s life insurance. Life insurance provides valuable financial relief to your dependents and heirs after your passing. It can minimize financial challenges during an already difficult period.
 
While it may not be pleasant to think about your own passing, the issue is too important to ignore. That’s especially true if you have dependents or other loved ones who may be financially impacted by your death. Below are a few ways in which life insurance can help your estate and your heirs.

Provides Cash for Heirs 

The days and weeks after a loved one’s passing can be emotionally draining, but they can also be financially challenging. Your heirs could face a wide range of bills, including final expenses for your funeral and possibly outstanding bills for any health care you received during your final days.
 
If you’re a financial provider for your spouse or children, they may also face the prospect of moving forward without your income. They don’t just lose you; they also lose your paycheck. That could make it difficult for them to maintain their standard of living.
 
Life insurance provides quick cash so they can overcome these challenges. Your death benefit is paid out in a lump sum to your designated beneficiaries. They can then use that money to pay bills, cover your final expenses, and even replace your income.

Helps You Maintain Control 

Perhaps you want to leave a legacy to your children and grandchildren, but don’t particularly trust them to receive a large lump sum upon your death. Maybe they’re too young to manage a sizable amount of money, or perhaps they’ve struggled with financial discipline in the past.

No matter your specific concerns, a trust is a great way to manage your legacy even after you pass away. When you create your trust, you can specify rules and guidance about how money should be managed and distributed to your heirs. You can specify that it’s distributed at certain points in time or when an heir reaches a specific age or life milestone.
 
How do you fund your trust? One way to do it is through life insurance. You simply make the trust the beneficiary of a life insurance policy. Then the assets are distributed to your heirs according to your rules. You provide a financial legacy for your loved ones, but still do it on your terms.

Minimizes the Impact of Probate 

Even if you have a will, your estate may still have to go through a process called probate. This is the legal process for finalizing an estate. During this time, your estate executor works with the local probate court to finalize outstanding items like taxes, debts, asset liquidation, the notification of heirs, and more.
 
Probate can be time-consuming and costly. If your estate is complex, it could take months before your assets are distributed to heirs. Your estate could also rack up thousands of dollars in legal fees and other costs, reducing the amount that goes to your heirs.
 
Life insurance avoids probate. It doesn’t go through the legal system. Rather, it’s paid directly to your beneficiaries as a tax-free lump sum. That means they get a benefit quickly, which they can use to pay bills or to simply enjoy your legacy.
 
Ready to incorporate life insurance into your estate plan? Let’s talk about it. Contact us today at Thomas Financial. We can help you analyze your needs and goals and develop a strategy. Let’s connect soon and start the conversation.
 
1 | https://www.aarp.org/money/investing/info-2017/half-of-adults-do-not-have-wills.html
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
19150 - 2019/8/19

Planning your retirement strategy? Wondering where your income will come from in retirement? It’s likely that Social Security will be part of the mix. More than 90% of Americans age 65 and older receive Social Security benefits. In fact, for 48% of married elderly couples and 69% of unmarried seniors, Social Security represents more than half their income.¹
 
The average retiree receives $1,461 per month from Social Security.¹ While that’s a significant amount, it’s likely not enough to support a full retirement. If you’re like many retirees, you’ll need income from sources besides Social Security.
 
How much of a role will Social Security play in your retirement? And how much additional income will you need? To answer those questions, it’s helpful to know how your Social Security benefit is calculated.

How much can you expect from Social Security? 

The Social Security Administration can provide an estimate of your benefit amount. It’s driven by your career earnings and your age at the time you file. Generally, everything else being equal, higher career earnings lead to a higher benefit amount. However, your age at the time you file for benefits also plays a major role.
 
You are eligible to receive your full benefit when you reach your full retirement age (FRA). Most people have an FRA between their 66th and 67th birthdays. You can file as early as age 62. However, your benefit could be reduced by as much as 30% if you file before your FRA.²
 
You can also delay your filing past your FRA and increase your benefit amount. Social Security credits your benefit by 8% per year for every year you delay your filing past your FRA. This credit is offered up to age 70.³
 
Again, Social Security can offer an estimate of your future benefits. Also, a financial professional can help you determine how Social Security fits into your retirement strategy. You may not be able to control your career earnings, but you can maximize your benefit by carefully planning the timing of your filing.
​
How else can you generate retirement income? 

Even if you delay your Social Security and maximize your benefit amount, it’s likely that you will need some other form of income. Perhaps you have a defined benefit pension through your employer. Or maybe you can take withdrawals from your 401(k) or IRA.
 
You also may want to consider an annuity with a guaranteed* income benefit. These are tax-deferred vehicles in which you can potentially earn interest. However, many annuities also offer optional guarantees* that provide a guaranteed* income stream for life. No matter how long you live or how your annuity performs, you still receive income. That kind of guaranteed* cash flow could supplement your Social Security benefits and provide financial stability in retirement.
 
Ready to plan your income strategy in retirement? Let’s talk about it. Contact us at Thomas Financial. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.
 
1 | https://www.ssa.gov/news/press/factsheets/basicfact-alt.pdf
2 | https://www.ssa.gov/planners/retire/retirechart.html
3 | https://www.ssa.gov/planners/retire/delayret.html
 
*Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
19151 - 2019/8/19

Are you 50 and just now starting to save for retirement? Worried that your retirement may not be exactly like you planned? You’re not alone. According to a study from Gallup, retirement is America’s top financial concern. More than 50 percent of Americans are worried that they will lack money for retirement.1
 
There may be good reason for concern. A study from the Economic Policy Institute found that the median retirement savings for American working families is just $5,000. Among those between ages 50 and 55, the median savings is $8,000.2 So while you may feel anxiety about your retirement planning, you’re not the only one in this position.
 
The good news is it’s never too late to make adjustments and start preparing for retirement. Below are a few tips to help you get started. You also may want to consult with a financial professional. They can help you develop and implement a strategy.

Stick to a budget. 

Do you use a budget? If not, now may be the time to start doing so. Nearly a third of American families don’t use a budget, even though it’s a powerful and helpful financial planning tool.3
 
Your budget can help you make smart purchasing decisions and save more money. You can use an app or software or even a simple spreadsheet. Simply list all of your spending categories and then look for areas where you can make cuts. The key is to update your budget, stick to your spending goals and contribute your extra cash flow to savings.

Use catch-up contributions. 

Does your employer offer a 401(k)? Do you have an individual retirement account (IRA)? These types of accounts are powerful retirement savings vehicles because they are tax-deferred. That means you don’t pay taxes on growth as long as the funds stay inside the account. That may allow your assets to compound at a faster rate than they would in a taxable account.
 
Starting at age 50, you can contribute more money to these accounts through something called a catch-up contribution. A catch-up contribution is an extra allowable contribution amount for those approaching retirement.
 
In 2019, you can contribute up to $19,000 to your 401(k) plan. However, if you’re 50 or older, you can contribute an additional $6,000, bringing your total allowable contribution to $25,000.4 You can contribute $6,000 to an IRA, plus an additional $1,000 if you’re 50 or older.5

Consider delaying retirement. 

If you’re just getting started on saving for retirement, you may want to rethink your retirement age. There’s benefit to delaying your retirement. Every year you wait to retire, you give yourself another year to save money. You also eliminate a year of retirement that would have to be funded by savings.
 
There’s one other benefit to delaying your retirement - you could get more from Social Security. You get your full Social Security benefit when you retire at your full retirement age (FRA), which is between 66 and 67 for most people.6
 
However, you don’t have to file at your FRA. You can delay your filing. If you do, Social Security will credit your benefit amount by 8 percent for each year you wait. The credits stop at age 70. However, if your FRA is 66 and you delay your filing to 70, you could earn a 32 percent bonus on your benefit.7

Protect your assets. 

Finally, you may want to consider a strategy that minimizes your exposure to risk. As you approach retirement, you have less time to recover from a market downturn. It’s important to grow your assets, but it’s also important to reduce threats like market volatility.
 
A fixed indexed annuity (FIA) could help you do just that. FIAs pay annual interest based on the performance of a market index, like the S&P 500. The better the index performs, the more interest you may earn, up to a limit. If the index performs poorly or loses money, you may earn less interest. However, you never lose money due to market losses. An FIA could be an effective protection strategy for a portion of your assets.
 
Ready to kickstart your retirement planning? Let’s talk about it. Contact us today at Thomas Financial. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
1https://news.gallup.com/opinion/polling-matters/260570/despite-economic-success-financial-anxiety-remains.aspx
2https://www.cnbc.com/2017/04/07/how-much-the-average-family-has-saved-for-retirement-at-every-age.html
3https://www.prnewswire.com/news-releases/fewer-americans-are-budgeting-in-2019----although-they-think-everyone-else-should-300824384.html
4https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-401k-and-profit-sharing-plan-contribution-limits
5https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-401k-and-profit-sharing-plan-contribution-limits
6https://www.ssa.gov/planners/retire/retirechart.html
7https://www.ssa.gov/planners/retire/delayret.html
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
​

It’s that time of year again. Time to hit the stores for back-to-school deals. If you have kids in school, you probably have a long list of colored pencils, notebooks, markers and other supplies. Perhaps you need to get your kids shoes, a new backpack and even new wardrobe. And you can’t forget the back-to-school haircut.
 
This is the season when we make sure our kids our prepared for the upcoming school year. However, it’s always a good time to make sure you and your kids are prepared for financial challenges that could arise. Life can be unpredictable. The best way to minimize risk is to prepare for possible emergencies, no matter how small the probability.
 
Life insurance is one effective protection tool. It may seem unnecessary for children, but there are a few important benefits. Below are some reasons why you may want to consider life insurance protection for your kids:

It provides financial protection for final expenses. 

It’s never pleasant to think about death, especially involving a child. The probability of a child passing away is usually fairly slim, especially for children who are relatively healthy. However, the fact remains that children do occasionally pass away. Accidents happen. Illnesses develop. These things are unfortunate realities.
 
Life insurance provides a tax-free death benefit upon the insured’s passing. You can use that benefit to pay for final expenses, medical bills and any other costs that may arise as a result of the death. While it may be morbid to consider the possibility, life insurance can ultimately minimize the financial fallout related to an already tragic situation.

It’s usually affordable. 

Life insurance costs are generally driven by the risk of the insured. The more likely it is that an individual will pass away soon, the higher the cost tends to be. Insurance companies analyze age and health to make this determination.
 
Children usually fare well in this analysis. They’re young in age, which obviously reduces their likelihood of passing away. If your child is generally healthy, that also works in their favor. Very often, you can purchase life insurance coverage on a child for minimal cost. A financial professional can help you compare policies and premiums.
 
It locks in coverage for later in life. 

When you purchase life insurance, the insured must go through a process called underwriting. This is an analysis of the individual’s health to determine their risk. For older individuals, underwriting can be a complicated process. However, for children, it usually involves a review of medical records and perhaps a simple physical.
 
One of the benefits of owning life insurance is that you usually only have to go through underwriting one time. As long as you own the policy, you have guaranteed* coverage, which means you can increase your coverage amount at any time without going through underwriting again.
 
This could be an important benefit for your child later in life. If they develop a health issue that increases their risk, they can still obtain coverage through the policy you bought them as a child. And they can do so without going through underwriting.

It serves as a savings vehicle. 

Many permanent life insurance policies have something called a cash value account. When you make a premium payment, a portion of the premium covers the cost of insurance. The remainder is deposited into the cash value account.
 
The cash value account grows on a tax-deferred basis over time. The method of growth depends on the type of policy. Whole life policies pay annual dividends. Universal policies pay interest. There are even variable universal life policies that allow you to invest in the financial markets.

Ideally, you’ll never have to use the death benefit feature of the policy. When your child grows up and assumes ownership of the policy, they can either continue the coverage or use the accumulated cash value to help them reach their financial goals. The policy can serve as a tax-efficient savings vehicle as they grow up.
 
Ready to explore life insurance options for your child? Let’s talk about it. Contact us today at Thomas Financial. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
*Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values.
 
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.

​It’s vacation season! Where are you travelling to this summer? Are you headed to the beach to soak up the sun and enjoy the waves? Or are you more of a lakes and mountains person? Perhaps you’re travelling to historical sites or a favorite national park.
 
Whatever your vacation plans may be, there’s no doubt that it’s nice to get away, relax, and recharge. If you’re like most people, you probably dread the end of your vacation and the return to the daily grind.
 
Fortunately, there’s a light at the end of the tunnel. Retirement is your opportunity to leave the working world behind and live life on your terms. You can hit the beach, the mountains, the golf course, or pursue any other activity that you enjoy.
 
Of course, to truly live life on your terms in retirement, you’ll need a strong financial foundation. If you don’t have the right strategy in place, you may not have the means to enjoy your golden years. Below are a few tips to consider as you approach retirement. Implement these ideas and your retirement can be one long vacation.

Use a budget. 

According to a recent study from Debt.com, 33% of Americans don’t use a budget.1 If you’re among those who do use a budget, you’re off to a good start. However, if you don’t use one, now may be the time to start doing so.
 
A budget is one of the most powerful financial tools at your disposal. You can use it to track your spending and make informed purchasing decisions. Your budget can keep your spending under control so you can boost your savings.
 
A budget can also be helpful when you enter your retirement. You’ll likely enter retirement with more assets than you’ve ever had. It can be tempting to spend that money on vacations, shopping, dining out, and more. Retirement can last several decades, though. If you spend too much in the early years of retirement, you may not have enough assets left in the later years. A budget can help you control your spending and make your assets last.

Create guaranteed* income. 

One way to preserve your assets is to develop income streams that cover your expenses. If you have enough guaranteed* retirement income to fund your regular expenses, you can use your savings to fund discretionary costs like travel.
 
Social Security is a common source of guaranteed* income. If you’re fortunate enough to have a defined benefit pension, that can also be a source of guaranteed* lifetime income. However, you may need additional income to cover your expenses.
 
An annuity may be an option to consider. There are several different types of annuities you can use to generate guaranteed* income. For instance, some annuities offer a guaranteed* withdrawal benefit. Your funds have the potential to grow and you can withdraw up to a certain amount each year. As long as you stay within the withdrawal limits, the income is guaranteed* for life. This kind of guaranteed* income can give you financial predictability and certainty.

Minimize risk. 

Nothing can derail your retirement plans like a costly emergency. For retirees, health care expenses can be especially dangerous. Fidelity estimates that the average retiree will spend $285,000 out-of-pocket on health care costs like deductibles, premiums and copays.2
 
You can take steps now to minimize those costs. For example, a health savings account (HSA) could help you pay for out-of-pocket medical expenses. Long-term care insurance could help you pay for extended care, either in your home or in a facility.

Also consider the importance of life insurance in retirement. If you have a spouse who is dependent on your defined benefit pension benefit or other income, life insurance could be a key risk protection vehicle. If you pass away, your spouse may face serious financial challenges, and that could limit their ability to enjoy the remainder of their retirement.
 
Ready to plan your ideal retirement? Let’s talk about it. Contact us today at Thomas Financial. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
1https://www.prnewswire.com/news-releases/fewer-americans-are-budgeting-in-2019----although-they-think-everyone-else-should-300824384.html
2https://www.fidelity.com/viewpoints/personal-finance/plan-for-rising-health-care-costs
 
*Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
19007 - 2019/6/27

It’s that time again. The Fourth of July is here. It’s time for barbeques, pool parties, and fireworks.  The holiday is a great midpoint in the summer to take time away from work and connect with family and friends.
 
While the Fourth may be a time for parties, it’s also a time to honor history. The holiday celebrates the signing of the Declaration of Independence in 1776, which stated that the 13 American colonies were free, independent states and were no longer subject to British rule.
 
Independence is an important value in our society. We all want the ability to chart our own future and live life as we determine. Unfortunately, sometimes our independence is restricted by financial challenges. That’s especially true when costly emergencies arise.
 
One of the most financially damaging events that can happen to any family is the death of a breadwinner or provider. If you financially support your spouse, children, or other dependents, your death could create a serious financial challenge for your family. They may have to change their lifestyle or even move to a more affordable home. They may be overwhelmed with bills. They could have to change their long-term goals, like college or retirement. In short, they could lose their independence.
 
Fortunately, you can use life insurance to protect them in the event that you suffer an accident or illness and pass away. The odds of that happening may be small, but the risk is too large to ignore. Life insurance provides your loved ones with a tax-free lump sum of cash that they can use to replace your income, pay bills, and protect their independence.
 
Do you have a protection strategy for your family? If not, now may be the time to consider it. Even if you do have life insurance, it’s always helpful to review your coverage and make sure it’s still consistent with your needs and goals. Below are a couple questions to consider:

How much life insurance do you need? 

What is the right coverage amount for you and your family? Many people use a multiple of their salary to calculate their coverage. For example, they may use three times or even ten times income as an estimate.
 
While these types of estimates are simple, they may not always be accurate. A more effective approach is to base your coverage on your family’s specific needs. Think about what costs your spouse, kids or other dependents may face after your passing. What kind of financial challenges could arise?
 
They may need to replace your income over an extended period of time. You may want them to have enough money to pay off the mortgage or other debts. Perhaps you want to help them reach their long-term goals, like college or retirement. There also may be costs related to your death, like medical costs or final expenses.
 
A financial professional can help you identify these costs and estimate their amount. He or she can also help you consider other factors, such as how to distribute your death benefit to your loved ones or how the funds may be managed after your passing.

What’s the right type of life insurance for you? 

Not all life insurance is the same. There are many different types, but most fall into one of two categories: term or permanent. Term insurance has a limited duration, like 10 or 20 years. You pay premiums over that period in exchange for coverage. When the term ends, so does your protection.
 
Term insurance is useful when you have limited need. For instance, many people use term policies that align with the length of a mortgage. Others may use term insurance when they have young children in the home.
 
As the name suggests, permanent insurance lasts for life, as long as you meet the premium requirements. Permanent policies also have a cash value component. A portion of your premium goes into the cash value account, which can then grow on a tax-deferred basis. You can eventually use your cash value to pay future premiums, buy additional coverage, or even to generate income.
 
Ready to develop your life insurance strategy? Let’s talk about it. Contact us today at Thomas Financial. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
19011 - 2019/7/1

​The NBA Draft is right around the corner. On June 20th, a few dozen college basketball players will become instant millionaires as soon as their name is called. It’s a life-altering event, and for many, the culmination of a lifelong dream.
 
Unfortunately, the dream can turn into a nightmare for some professional athletes. A 2009 study from Sports Illustrated found that 60 percent of NBA players go broke within five years of retirement. More than three-quarters of NFL players face financial difficulty within two years of retirement.1
 
A multi-million dollar sports contract should be a blessing. However, many athletes aren’t prepared to handle that kind of money, especially when they cash in at such a young age. Many spend their earnings on cars, jewelry, and more under the false assumption that their career will last forever.
 
Retirees often face similar challenges. On your retirement day, you aren’t called up to a podium on national television and awarded a contract worth millions of dollars. However, on the day you retire, you may have more money available than you’ve ever had in your life. You’ve probably spent years, or even decades, contributing to your 401(k), IRA, or other accounts. When you retire, you finally have the option to access those funds.
 
It can be tempting to spend that money on vacations, shopping, dining out, and other fun activities. After all, retirement is your time to enjoy life. However, if you spend too much in the early years of retirement, you may find yourself short on funds in the later years.
 
The good news is you can take action today to prepare yourself for a long retirement and avoid some of most extreme financial challenges. Below are the two financial tips Shaquille O’Neal gives to all NBA rookies. However, you don’t have to be a gifted basketball player to benefit from these pieces of financial wisdom. Incorporate these ideas into your strategy as you approach retirement.

Tip #1: Only spend what you have to. 

As soon as he entered the NBA, Shaq spent $1 million to help his parents retire. After that large purchase, though, he adhered to a strict 75/25 rule when it came to spending. His first 75 percent of earnings went to savings. That left him with 25 percent of his earnings to spend on cars, jewelry, or whatever else he wanted. He suggest that all young athletes follow the same advice.1
 
Granted, it’s much easier to save 75 percent of your earnings when you make nearly $300 million over the course of your career. However, there’s still a lesson in here that you can apply to your retirement planning.1
 
Shaq allocates money to savings before he spent anything on discretionary items. In other words, he treats savings like a mandatory expense, not an option. You can boost your retirement savings by adopting the same philosophy.
 
Treat your savings as something that has to happen before you can spend money on anything else. You may not be able to save 75 percent of your income, but perhaps you could save 10 or even 20 percent. Your employer 401(k) could be a great tax-deferred savings options. You also may want to consider automatic contributions to an IRA or other account on your payday, so the money goes into the account before you spend it. Put your savings on autopilot and you’ll likely see your balance grow quickly.

Tip #2: Create guaranteed* retirement income. 

“Learn what annuities are,” Shaq once said when asked what advice he gives to young players. Shaq famously put a large portion of his savings into annuities that offered guaranteed* income streams later in life. Those annuities gave him confidence that he’d have lifelong income, no matter what happened in his career or in the financial markets.
 
An annuity could make sense as part of your financial strategy. There are a wide range of different types of annuities, but most offer some mechanism to provide guaranteed* income. Some allow you take an annual withdrawal. As long as you don’t exceed the withdrawal limits, the income is guaranteed* for life. Others pay you a guaranteed* income stream based on your age. A financial professional can help you determine what type of annuity is right for your needs.
 
Ready to implement Shaq’s financial advice into your retirement plan. Let’s talk about it. Contact us today at Thomas Financial. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
1https://www.cnn.com/2015/12/04/sport/shaquille-oneal-and-charles-barkley-of-the-nba-impart-financial-advise/index.html
 
*Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
18913 - 2019/5/24