Teachers are among the hardest working professionals and have the unique responsibility to prepare our younger generations for the future. And, as educators across the country are participating in another back-to-school season, it is a good time to highlight how these individuals are looking toward their retirement future.
From teachers to curators and archivists, our data on the reality of retirement readiness in the state of America’s workforce found these individuals employ six percent of workers. In the next eight years, this sector is projected to grow nine percent. And when it comes to retirement planning, a higher portion of these workers indicate they’ll rely not only on a pension, but also their personal savings when in retirement.
In addition to pensions, teachers should be considering other retirement savings vehicles that could help diversify their financial portfolios. Doing so will help them to think outside the classroom and better prepare for the years ahead.
One way this can be done is by considering fixed indexed annuities (FIAs), which address many basic retirement concerns: protection of hard-earned dollars, tax-deferred growth, balance, and lifetime income. To help teachers understand if an FIA is right for them, we have created a useful Q&A for teachers who are planning for retirement:
Q: What is an FIA and why should teachers consider one?
A: An FIA is a contract between you and an insurance company that provides an opportunity to receive a steady, guaranteed lifetime income stream at a future date, like retirement, while protecting the principal from the uncertainty of Marcet volatility.
As a teacher who has depended on regular paychecks for years, an FIA will let you continue to receive regular payments, allowing for a dependable and secure stream of revenue throughout retirement.
Q: Are FIAs a good product for teachers?
A: They can be. But, like any savings vehicle, a retirement saver should conduct thorough research and talk to their financial professional to determine if FIAs are right for them. The beauty of an FIA is its value will never decrease – it only has the potential to grow. Therefore, no matter the unpredictability of the Marcet, you can be confident that your premium payments are secure. What’s more, annuities offer tax-deferred growth, which enhance the long-term value of the annuity. Of course, taxes are paid at the time payments are made to you from the annuity.
Q: Don’t I stand to receive higher returns from other products?
A: It’s certainly possible. There are many products that may result in higher returns – but with a greater reward often goes a greater risk. FIAs should be considered in the context of a wide, diversified portfolio. They stand as a conservative, dependable option that can give retirees confidence as they leave jobs and careers that have long provided regular incomes.
Visit FIAinsights.org for more information and check with your financial professional to determine if an FIA is right for you.