Annuities

Ever Consider In-Service Withdrawals?


Annuities

I realize you’ve heard about the opportunity with baby boomers more than a thousand times, but it’s vital that boomers be adequately prepared for retirement. With one misstep, years of planning could be jeopardized.  Not safeguarding their life’s work from a market downturn while transitioning into retirement could be devastating.

Your clients’ 401(k)s need some level of principal protection, and now may be the perfect opportunity to educate them about aged-based, in-service withdrawals at market highs. The strategy works by completing a direct rollover with a portion of their employer’s retirement plan into a fixed index annuity within an Individual Retirement Account. Keep in mind the IRS allows age-based, in-service withdrawals; however, each plan may have its own particular restrictions. In some cases, withdrawals may be based on service credits or subject to a vesting schedule. The benefits of an in-service withdrawal include more control over assets, additional income and wealth transfer options, and the opportunity for more investment strategies.  

It may be the perfect time for this strategy considering history and today’s market levels. Take a look at the S&P 500 index, for example. In the last 14 years, the S&P was nearly cut in half twice. According to the Federal Reserve, U.S. median household net worth decreased by 39 percent between 2007 and 2010, consequently reducing 18 years of gains during that time period. 

The Bottom Line: Help protect your clients’ nest eggs and create the retirement lifestyle they hoped for. Ash Brokerage will help you in selecting an appropriate fixed indexed annuity with the latest crediting strategies and cutting-edge GLWB’s to help maximize lifetime income while keeping the nest egg intact in the event of a market downturn. 

in-service withdrawal IRA 401k

Don’t forget this solution for businesses


Annuities

We all know annuities are a great solution for retirement. But have you ever considered annuities as a retirement solution for businesses? If you’re working with business owners and executive-level clients, ask if their company has a defined benefit pension plan. 

Why? Traditional pension plans have become a thing of past as 401(k) and other contributory plans have overtaken the retirement landscape. As a result, many businesses have decided to do two things: 

  • Freeze and eventually terminate an existing defined benefit pension plan
  • Shift all or a portion of their plan benefit obligations to a third party

Here’s how it works: Businesses with a defined benefit pension plan can remove plan liabilities from their books by transferring the risk to a group annuity issued by a top-rated insurance company. This transfer allows the company to eliminate premiums paid to the Pension Benefit Guaranty Corporation along with significant cost savings in the plan administration. These cost savings can be reinvested in their business. Most importantly, the transfer allows the company to make good on the benefit promises made to their employees.

Plan participants benefit from the transfer because it ensures payment of the plan benefits promised to them at retirement that may include guaranteed income, the ability to provide ongoing income for a joint annuitant, and options such as payment frequency or cost-of-living adjustments.

You don’t have to be an expert to help your business clients execute this unique solution – Ash Brokerage has a dedicated team who can do it for you. You should call us – (800) 589-3000 – to learn more or to start identifying opportunities today. 

business annuities 401k retirement planning