mickroark wrote:Sounds kind of like kinder garden. I will show you mine if you show me yours.
Well, I kinda thought the same thing as Grt2bOutdoors when you said:
How can one outperform stocks when these annuities only pay out a portion of the gains of stocks, but not all? There's no possible way you can "outperform" stocks if you're not getting the entire return of the performance of stocks
mickroark wrote:"With time to grow and no loss of principal, they will easily outperform stocks and bonds for most investors. The only way a stock and bond investor can beat these is if they can buy and hold for 30 years".
As an owner of this "Stuff", some BH need to get off the comparison of ANY annuity vs a stock/bond/cash portfolio.
The good way to describe our purchase is, " I bought a Pension Plan, with known costs and gives us a minimum Income
at X date in the future. It tries to replicate a conservative, Tier 1, PERS. We bought Insurance in the form of a pension. I sold off much of my retirement Income risk to some entity, who thinks that it can make money on this transaction. I hope they do make money, too.
My profit/loss profile for this type of annuity would look something like a long Straddle Option.
The BIG question that I asked myself, " If, another BlackSwan event, prolonged Inflation/Deflation, how would we do?
and What can I do to minimize their effects on our retirement?
Notes: Purchase at ages 59/61-62/65. Current age 66/69. Current Income
and future Income
portfolio: Bucket #1-SS (took at first oppurtunity), small pension (non COLA); Bucket #2- deferred GLWB annuities (not taking Income); Bucket #3- rental condo (purchased with inheritance and taking Income
. This was unforeseen and we would be fine without this bucket). This Income
portfolio, Buckets 1-3, hopefully will be fairly immune to Market gyrations and should be flexible enough to withstand moderate inflation and strong deflation.
Our Bucket #4- INVESTMENT
portfolio is something that has considerable Risk exposure, representing about 20% of retirement assets. Today, the discretionary is almost entirely in Cash holding. On, 02Jan2016, we were fully invested. We're +3 to +5% YTD on this discretionary.
Bucket #0-We also have a non-Income acreage. Carrying costs are relatively small. Considering selling this property but not in a hurry. We own home. We consider home and acreage as expense
s, not risk or assets. LTCi. Small debt from DS education at 3%, interest will be entering income deduction phase out. We are in SS Hump zone and will be determinate on how I manage retirement Income and Deductions.
Rev012718; 4 Incm stream buckets: SS+pension; dfr'd GLWB VA & FI anntys, by time & $$ laddered; Discretionary; Rentals. LTCi. Own, not asset. Tax TBT%. Early SS. FundRatio (FR) >1.1 67/70yo