Planning for Retirement: Why You Should Consider a Guaranteed Future Plan
When it comes to retirement, many people think that they will just be able to retire on their social security benefits or what they have saved up. Guaranteed future plans are a great way to ensure that you will save for your retirement and not worry about how much money you should put away each month.
These programs can help individuals who may not have time to plan out their finances while working full-time. Guaranteed future plans typically offer a guaranteed rate of return over the course of the individual’s lifetime, and some even cover costs associated with inflation! Guaranteed future plans can be a great way for you to invest in your future and ensure that you will have enough money when it comes time to retire.
What Entails A Guaranteed Future Plan?
- Guaranteed future plan guarantees a steady return on investment for an established period of time, with some plans offering inflation protection.
- A Guarantee is based on the individual’s life expectancy at enrollment and can be terminated if that person dies before reaching retirement age (usually 65). Some Guaranteed Future Plans are Guaranteed for Life.
- Guarantees a minimum return if the Guarantee is terminated before retirement age, which may depend on when you enrol in the plan.
- Guarantees that contributions will be made to your Guaranteed Future Plan account based on an assumed rate of return or the dividend yield, as stated by the insurance company, and can range from conservative to aggressive.
- Guarantees that the Guaranteed Future Plan will not sell or buy securities from a company in which it has an interest.
- Guarantee is based on two factors: life expectancy and investment return assumptions (which should be disclosed). The Guarantee Company typically sets these.
- Guarantees that contributions will be sent to your Guaranteed Long term savings Plan account on the first day of each month.
- Guarantees that funds in a Long Term Savings Plan are not invested in Guaranteed Future Plans.
- Guarantees that the Guarantee Company may sell securities based on a policy set by the company and cannot buy from or invest with any other Guarantee Company.
How To Protect Your Family?
- If all of the beneficiaries are over 55, then they collectively own 100% of the Guaranteed Future Plan.
- Beneficiaries will receive a death benefit if their Guaranteed Future Plan participant dies while enrolled in Guaranteed Future Plans or Long Term Savings Plans.
- If beneficiaries are under 55, then they collectively own 50%, and the Guarantee Company owns the other 50%.
Final words:
Since Guaranteed Future Plans are a type of long-term savings plan, it’s important to make sure that your funds grow with inflation over time. You can do this by investing in Guaranteed Future Plans through an insurance company or other financial institution such as a bank, credit union, or investment fund. That way, you’ll have peace of mind knowing that your Guaranteed Future Plan will be there for you in the future.
