Life Insurance Quotes

Choosing between long-term investment and short-term movement

10/12/11

According to the Wall Street Journal, many investors are currently torn over how to best handle their retirement portfolios. In the wake of the economic downturn and the recent instability of the stock market, many financial advisers are telling their clients to take money out of long-term investments before they suffer even bigger losses, while major financial officials are telling clients to stay the course, continue depositing and wait for gains to return.

Financial advisers have convinced some clients to move holdings from higher risk and reward equities funds to more stable fixed annuities, according to the source. While these financial products may not ultimately offer the potential for gains that indexed products do, they are ultimately more reliable, and give retirees a steady stream of income.

Some metrics, however, show that investors who maintain their current rates of investment in retirement plans throughout periods of economic instability actually come out on top. A Fidelity study, the source notes, found that investors who kept putting the same amount of money into their 401(k) plans through the recession in 2008 doubled the gains that those investors who temporarily pulled out of the funds did when the market returned.

According to the Insurance Information Institute, sales of fixed annuities declined by 27 percent in 2010 while sales of variable annuities increased by 10 percent, an indication of how short term market performance can affect an overall investment climate.

Talk to an Advisor

A licensed insurance advisor can explain your options and help you choose the right life insurance for your needs.

Call: 1-800-823-4852

Chat: Live Advisor Chat

Sm

A few of the carriers we quote