Quote:
Originally Posted by Goldwingnut
Rule #1 when investing - if you don’t understand what you’re investing in, don’t! If the person who’s recommending something can’t explain it to you so you can understand it, walk away.
If you’ve never heard of him, Dave Ramsey has a radio show (#3 nationally) that provides good financial guidance based on simple principles (don’t spend more than you make, save for retirement, don’t use credit cards, live debt free, etc) that is worth a listen. After nearly 20 years of listening to him I’m pretty sure he’d advise you not to buy an annuity.
Something to consider, if you give the money to this salesman (that truly is what you’re doing) you can never touch it again. They will give you a dole every month but you can never access the principal again. What if your life changes (that would never happen at 70 years old…) and tomorrow you need to lay your hands on some of the money, you can’t pull it from the annuity, that money is no longer yours to control. When you die, is there a survivorship? Likely not or very limited, maybe your spouse, but certainly it won’t continue yielding the monthly dole for generations to come. So what happens to the money, the company keeps it in payment for the “guaranteed income for life”. It’s not hard to figure out that they are betting on you not living as long as you are.
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Wow, wingnut, I have been following you for a long time and this is the first time I strongly disagree. Dave Ramsey is great for get out of debt and I love the guy. However, his investment advice is close to malpractice. Invest in managed mutual funds and assume a 12% return is just crazy. So I tell people to get out of debt with Dave, then read simple path to wealth for investment advice. However, for retirement advice Wade Pfau is the only way to go. The foremost researcher in the retirement income space and he disagrees with you on annuities and so do I. As a small portion to guarantee a minimum income floor they are invaluable. The last 2 years is proof when stocks AND bonds are both down.
I totally agree with understanding what you are buying so read Wade Pfau’s books, especially the complete guid to retirement and you will make better decisions. Do NOT rely on Dave Ramsey for retirement advice PLEASE!