More Conversations with Serious Savers: Part 5

When it comes to planning retirement, you're taking aim at a moving target. There's longevity risk, the decline of pension plans and the uncertain future of Social Security. And the job just got tougher, as the current economic crisis is rewriting the financial playbook. According to a recent survey by AARP, if the economy does not improve, over 6 in 10 workers aged 45 and older say they will likely delay retirement and work longer. And nearly 6 in 10 think they are not saving enough. That's where a tax-deferral can help. Below is the first of several conversations we've had with investors and advisors about the benefits of saving more with low-cost no-load variable annuities. Stay tuned over the next several weeks as I post their valuable insight.

Jim Brown, CFP, President, J M Brown & Associates, Inc

Helping clients plan for a long and rewarding retirement is important to me. So I'm a big proponent of tax-deferred compounding. Deferring gains can help you accumulate more. And the tax advantage can be even more powerful if you enter a lower tax bracket in your retirement years. It can provide diversification without current tax implications. And tax-deferral can also benefit clients with "tax-inefficient" investments, such as REITs, bonds, and actively managed stock funds that generate short-term capital gains and ordinary income, currently taxed as high as 35 percent.

The key is finding the right kind of variable annuity. Most traditional VAs charge asset-based fees that can erode performance, and surrender fees that can keep investors locked-in for years. But when Jefferson National came out with Monument Advisor, we took a real good hard look at it. They really did their homework. We liked the flat-insurance fee. We liked what they were doing in terms of underlying funds. There's no commission, and that means no conflict of interest. It can work for just about any type of professional, but especially for fee-based advisors like us. Monument Advisor will definitely have an impact on the industry. And I believe it will make a difference. It's only logical.

An investor should carefully consider the investment objectives, risks, charges and expenses of the investment before investing or sending money. For a prospectus containing this and additional information, please contact your financial professional. Read it carefully before investing. The summary of product features is not intended to be all-inclusive. Restrictions may apply. The contracts have exclusions and limitations, and may not be available in all states or at all times.
Variable annuities are investments subject to market fluctuation and risk, including possible loss of principal. Your units, when you make a withdrawal or surrender, may be worth more or less than your original investment.
Variable annuities are long-term investments to help you meet retirement and other long-range goals. Withdrawal of tax-deferred accumulations are subject to ordinary income tax. Withdrawals made prior to age 59 1/2 may incur a 10% IRS tax penalty. Jefferson National does not offer tax advice. Annuities are not deposits or obligations of, or guaranteed by any bank, nor are they FDIC insured.
Variable Annuities are not suitable for everyone. You should consult with a financial professional to determine if a VA is suitable for you.