Money - Annuities

 

Oh, I think we're recording. So, if we're recording Well, I wonder what happened there. Anyway, bottom line is there's a good opening. Bottom line, that's a that's money talk. I'm gonna I'm gonna talk about money and uh without looking at any notes, just based on my own memory and experience, I make a few points about being single, being together or as a couple, but now being single. Okay. Money. If you're lucky, you're working, you get a salary. The salary is based on your work, your productivity. Uh, every week, everymonth, whatever their pay scale is or whatever their time period is, you get a paycheck. You don't know how long, you know, you're going to be getting it. It just keeps coming as long as you're working. And my priority since I was a kid was just to keep working and made a few good choices along the way. So here I am retired and after contributing to my pension, contributing to social security, I have a pension in social security. Now right there, if I had it to do over again, my advice would bestick with social security a few years longer. In other words, wait to start collecting social security until your maximum age, whatever it might be. If it's 65, 70, whatever it might be at this point. because the reason being you will increase the amount you get per month. So social security is in a way an annuity and that's going to lead into what I'm actually going to talk about annuities which is an investment I'm considering and the reason for that is because just like social security it pays you every monthum for the rest of your life which is a huge huge thing. Any of you young people who think, oh, you know, social security, I don't need it or what. Oh, it's a Ponzi scheme, all the you hear out there about it. Look, when you retire, unless you are a multi-millionaire, you're going to need social security and don't, you know, don't downgrade that. So, who is FA and why are they taking all my money? Well, it's the government taking the money to save and invest for you because you don't have the discipline to do ityourself. And that's just another reality. If left to our own devices, most of us don't have that level of discipline to save money. I personally did have a little discipline. And I learned that from my dad who always said, you know, spend a little, save a little. He drum that into me. And, you know, I did it. Well, now we're at that point where I've saved up as much as I can. I have only so many more years to live. I don't know how many more years. and I want to focus on living, not dying, but I also don't want to outlivemy money. So, I'm thinking about, you know, an annuity because it's a guaranteed income for the rest of your life. Now, in return for that, of course, you're handing over a lot of money. And so, they're going to invest it. They're hoping, you know, well, they're planning on investing it, making money with your money. And then they're also planning or hoping or whatever on their ammonization charts that you're going to die earlier, you know, than later. And that way they, you know, they get theirmoney back. Same same the social security works the same way. But there's a minimum that you're going to get back. And that's why I'll add the uh 10-year certain. So you have a fixed life annuity. You're going to turn over $100,000. they're going to guarantee so many so many dollars per month for every month of every year until you die. But if you die before the age or the before the length of 10 years, if you have a uh 10ear certain uh part in your contract, then they will pay at minimum that 10-year amount. Now, I'm thinking ofdoing that. I'm going to look at the cost of it and think out the rationality of it. But part of me just wants to do that just in case. So, and this is the wild part. So, my daughter doesn't say, "Well, you just wasted all your money because yeah, I'm still very self-conscious about what she might think." And uh you know I know she's going to think the best and love her daddy. But daddy has made some very good decisions and uh you know I've kept my money invested in very good stocks which have grown tremendously. But you can't spendstock at the grocery store. You have to convert it to cash. And with your RMD, your required minimum distribution, you're going to have to take out so much money per year, which I've been doing now for however many years, five, five, 10 years. Um, theoretically or mathematically eventually you're going to get down to zero. Now, the irony there is you are going to get down to zero. The longer you live, the closer you will get to zero. But if you get an annuity, here's the deal. I get an annuity as part of my cash holdings thatnow guarantees income for life. When I get down to zero, I still have income. There's the trick. That is the trick. Sometimes, in some ways, when I say it, it sounds almost too good to be true. Well, yes and no. Because they know that you are not going to live forever. They have charts to predict how, you know, how long you probably will live. Now, my mom lived to be 87. My dad 81. I can double check that, but I believe that's what I just checked. Um, Tess was only 81. Everybody said, "Oh, you're soyoung." No, she would say, "I'm old. I'm old." No, you're young. No, it depends on how you've gotten through life and how you, you know, the condition you're in when you get to whatever age. So, um it's not just a simple thing you're young or old, but statistically there's a bell curve, no doubt, or whatever that you're going to die most likely within a certain range of years. And if you exceed those years, which is what I'm betting on, uh then they're going to keep paying you and you're going to profit. If you uh live or diewithin that parameter, um then they recoup and they make their money. Okay? So, we understand that I do not I want to live to live. I want to have my mind clear for being healthy, living my lifestyle where, you know, I'm not a health nut by any means, but you know, I'm going to ride my bike over to Engles right now. I just do kind of healthy things by nature and um you know, my gene pool seems to be pretty strong. So, unless I get knocked off by a bus or something, um I will probably live. And I the main thingabout living is having enough money to live. So that's what an annuity an annuity is. An annuity is a contract where you give them your bulk sum, $100,000, $200,000, whatever I decide, and they in turn contract to uh send you $1,000 a month for the rest of your life. So, there is the deal. That $1,000 I can spend I can spend it going out for dinner. I can spend it on a new car. I can spend it taking my girlfriend out for dinner and having, you know, a reasonably good time. I'm not going to go hog wild crazy and do stuff outoutside of my normal uh lifestyle, but at least I feel like I can help or this will help me to afford the lifestyle that to which I have become accustomed. All right, that's enough. Annuities, take them or leave them. I'm going to take them.