Everyone’s situation is different.  Your personal and family circumstances, risk tolerance, age, investment capital available, existing sources of guaranteed income, and retirement income expectations are all important considerations.

A life annuity is for those of us who want safety and guarantees, and don’t want any management responsibilities.  It will guarantee you income for life, or provide income for the lifetimes of you and your spouse. Because you give up flexibility and access to your capital, you need to keep other money available for the unexpected, or have access to money with a secured line of credit against your home.

Annuities can be great for a healthy individual or couple with longevity on their side, and for the financially unsophisticated (or when one spouse is more knowledgeable than the other, it can protect the surviving spouse if they outlive the more financially experienced one).

If you have ever spent sleepless nights worrying about your investments because of market volatility, locking part of your money into annuities will provide risk-free income at a high rate of return relative to current low interest alternatives like term deposits and bonds.  Annuity income is also very tax advantaged, if you invest non registered money.  
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ZLC clients and friends enjoyed our recent workshop where our guest speaker, Doug Towill, presented several interesting and provocative thoughts on what we can expect in retirement.  Doug shared ideas on how we can best prepare ourselves to maximize our opportunities, and enjoyment, of this important, and hopefully long stage of our lives.

Highlights from the presentation included discussion on:

• The risks we face with Longevity (will we outlive our money during our 25 to 30 years of retirement?) inflation (what will a dollar buy us in 20 or 30 years?) and Market Volatility (will a drop in the market set us back?)
• The Sandwich generation (most middle age people have more parents than children)
• Our increased awareness of the dangers of retirement and whether products exist to help protect/manage losses (tragically, far too many assets are now held in tax inefficient and low interest bearing investments)
• The concerns we face in maintaining our lifestyle in retirement (a large percentage of us are finding that our expenses are much higher than we expected)
• The events that trigger retirement readiness (financial freedom, a significant age, health, death of someone close, career setback)
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Most of us know that life insurance is used to protect the people we love most. It pays tax free cash when we die.

We can get life insurance through work (some employers offer it through group benefits plans, but this type usually ends when we leave our employer) or we can buy it from an insurance advisor, like a ZLC Associate.

As each of our needs is different from someone else’s, it’s good to start with a basic rule of thumb: If someone relies on us to provide for them, then yes, we probably need life insurance.
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