How To Invest Risk-Free for Retirement: Stock Market Gains Without Losing Money

Shawn Plummer

CEO, The Annuity Expert

The stock market has been a reliable place to invest for retirement. The problem is that most people don’t know how to invest in the stock market without losing money. This guide will discuss how you can earn stock market gains for your retirement without risking your money! Time to retire happy!

This guide is perfect for investors,

  • Want to know how to invest in the stock market safely
  • Wondering if the stock market will crash again

What Is An Annuity?

An annuity is an insurance policy for retirement. The long-term investment is designed to help investors grow tax-deferred retirement savings and provide a retirement income for an entire lifetime.

Additionally, retirees utilize an annuity to safely grow their 401(k) and IRAs leading up to when they retire or efficiently spend their 401(k) and IRA during retirement.

What Is A Fixed Indexed Annuity

A fixed indexed annuity is a fixed annuity that earns interest based on the performance of a stock market index such as the S&P 500, Nasdaq, or Dow Jones. Because a fixed indexed annuity is an insurance policy, investors can never lose money due to a stock market crash. Investors are not investing directly in the stock market. The market performance is simply a measuring stick to determine how much compound interest is credited to your annuity each year.

Invest with compound interest!

Lock-In Gains

All gains earned in a fixed indexed annuity are locked in and can never be lost in a down market. Once you earn the compounded interest, it is yours to keep.

What can I Invest In?

Fixed index annuities allow investors to earn compound interest by investing in

Protect Your Investment

An indexed annuity is an insurance policy. As a result, investors will never suffer financial loss due to the stock market decline.

Utilize a Bonus For Contribution Match

Fixed index annuities can offer a guaranteed bonus on contributions to the retirement plan. The bonus mimics a company’s 401(k) contribution match.

For example, if an investor contributed $100,000 to an annuity offering an 8% bonus, they immediately have $108,000 in their account.

Invest Your Savings In Low-Cost Retirement Plans

Most fixed index annuities do not charge a fee for safely accumulating wealth. However, some plans charge an optional fee for more upside potential than standard products.

How Much Interest Could I Earn?

Plenty of fixed index annuity plans do not produce solid results. That said, utilizing an annuity expert to research products for you could produce beneficial results.

For example, my wife earned $26,865.24 in interest last year on her $112,642 fixed index annuity. She didn’t pay fees, and she’ll never lose money to the stock market taking a nosedive.

Hypothetical Example

How To Invest Risk-Free For Retirement: Stock Market Gains Without Losing Money (2023)

What Are The Trade-Offs?

  • Invest risk-free
  • Earn triple-compounding interest
  • Tax-deferred growth
  • Long-term retirement plans
  • Limited upside potential with principal protection
  • Can not withdraw income until age 59.5 without an IRA penalty

Open a Roth IRA Annuity

By opening a Roth IRA fixed indexed annuity, all gains will be tax-free when you retire. The exact contribution limits apply to the annuity. Investors should maximize contributions in the Roth IRA fixed index annuity first, then contribute to a non-qualified annuity afterward.

Contribute to an IRA with No Fees

An annuity might be the perfect option if you seek an IRA with no fees. Most IRA fixed index annuities don’t charge fees to owners unless they want to pay for more upside potential or add an optional rider for guaranteed income.

IRA or CD?

Because cd rates are meager, an IRA fixed indexed annuity is a better option because the investment is protected from market loss, and the earnings are tax-deferred or tax-free. Investors also get to invest with compound interest.

Open a Non-Qualified Annuity

After maximizing the contribution limits to a Roth IRA fixed index annuity, owners should start contributing to a non-qualified annuity. Non-qualified annuities are funded with money that has already been taxed. Therefore, only the gains earned will be taxed in the future, while the original investment is not.

Get An Annuity For Retirement Income

Another primary reason so many buy annuities are the guaranteeing of future income in retirement. The annuity can tell you exactly how much guaranteed income you could receive during retirement, starting today. Fixed index annuities can also educate an investor on how to achieve their desired future income.

Next Steps

Congratulations on making it to the end of our guide! You now know everything you need to invest in the stock market for your retirement without risking a penny. If you have any questions, don’t hesitate to contact us for more information or a quote. We wish you the best of luck as you work towards a happy and comfortable retirement!

How To Invest Risk-Free For Retirement: Stock Market Gains Without Losing Money

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Frequently Asked Questions

Are annuities high or low risk?

Fixed and indexed annuities are low-risk investments. Conversely, variable annuities are high-risk investments.

Shawn Plummer

CEO, The Annuity Expert

I’m a licensed financial professional focusing on annuities and insurance for more than a decade. My former role was training financial advisors, including for a Fortune Global 500 insurance company. I’ve been featured in Time Magazine, Yahoo! Finance, MSN, SmartAsset, Entrepreneur, Bloomberg, The Simple Dollar, U.S. News and World Report, and Women’s Health Magazine.

The Annuity Expert is an online insurance agency servicing consumers across the United States. My goal is to help you take the guesswork out of retirement planning or find the best insurance coverage at the cheapest rates for you. 

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