May 18, 2015 by Troy Baccus

5 Reasons to Lock in Gains Now


S&P 500 & P.E Ratios

We have had a nice run in the stock market since the housing crisis. Hopefully you were able to take full advantage of the growth experienced in the equities markets. Even if your portfolio hasn’t experienced double-digit growth over the past few years, you might be well-advised to take a more conservative approach for the years to come. Fixed annuities are our specialty and they offer guaranteed growth, small or zero fees, and zero stock market risk. Here are five reasons to lock in your gains and re-position your portfolio into a more conservative strategy.


Reason #1: If you are over 50, you cannot afford another market crash

If you experience a portfolio loss early in retirement, it might result in you running out of money later in life. Have you ever heard the term “sequence of returns?” It is a proven concept that establishes that a portfolio cannot sustain if major losses occur early in the “withdrawal period.” If you are over 50 years old then you will most likely need the money in your retirement account in the next 10 to 15 years. A 20% or 30% drop could result in you having to postpone retirement and continue working. Think it can’t happen? The 2008 crash resulted in a more than 20% decline in the S&P 500, which extinguished retirement dreams for many Americans.

Reason #2: Many factors point to an upcoming market correction

Even a normal stock market will experience ups and downs. Many experts agree that we are due for a 20% stock market correction based on corporate earnings. Even Federal reserve chair Janet Yellen warns that a stock market correction could be heading our way.  This correction is due regardless of the scary factors that exist in today’s market. What are the scary factors? The intention of this blog is not to induce fear, but here are a few items of concern off the top of my head and I’m sure I missed a few:

  • Interest rate instability
  • European debt crisis
  • $1.3 trillion college debt bubble
  • California drought (and the resulting impact on food prices)
  • Geopolitical tensions

Reason #3: Prepare for harder times

As we age it is a fact that our health will deteriorate over time. Some people will live long into their 80s and 90s before experiencing a health emergency. Others will have a health scare earlier in life. Regardless, when planning your retirement you need to be realistic that you will probably need medical attention at some point during retirement. Medical issues are costly. Make sure you have some risk free assets set aside to work through a medical issue. You should ask about long term care insurance as well.

Reason #4: Your returns can be sizable in a safe strategy

We work with safe accumulation assets. For some people the word “safe” translates to “small returns.” This is not necessarily the case though. We utilize aggressive growth fixed indexed annuities for some of our clients who want to be exposed to market upswings. By using the monthly point-to-point strategy in a fixed indexed annuity you can potentially receive gains upwards of 10%. Now get excited – those returns are only possible if the market performs well. Want to know the best part? When the market crashes you don’t lose a dime.

Reason #5: There ARE guarantees in life – you just have to pay in advance

The most important thing a person can have in retirement financially speaking is income. By positioning your at-risk portfolio into a safe strategy with a guaranteed income stream you can set yourself up very well for the future. Modern annuities allow you to guarantee yourself a lifetime income in the future. Think of it as reserving an income stream in case you need it.

Give us a call to discuss your retirement options. We have options for your investment account, IRA, and even your 401(k). We can design a strategy that will have a 100% success rate of reaching your income goals – all with safety in mind.


The Standard, MetLife, Principal Financial Group, Genworth, & Lincoln Financial Group