Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
we all have fire insurance on our homes yet the chance of collecting is below even 1%... the odds of our income stream failing to keep up with our lives with the performance of the last 12 years as a guide is huge....
seems to me we are insuring the wrong things in our lives if you think about.
If you had a pension at work which you contributed into would you still be worrying about how long you or your wife will live to make it worthwile to have or would you just be enjoying the reliabilty of the income stream while your alive?
Last edited by mathjak107; 04-06-2011 at 07:01 AM..
i disagree...you would be hard pressed to find any insurance company ever , i repeat ,ever where an annuity holder lost 1 penny of principal because the insurance company failed, or a life insurance policy holder wasnt paid full face value..
they have a better track record than even money markets by far .
not only do states guarantee annuities and life insurance up to state limits but every state insurance board has the power to force solvent companies to take over the policies of insolvent ones.
its far safer then any company pensions today thats for sure..
since very few annuity policies if any are not paid on for the full amount to date you have to assume they know what they are doing. the combination of dead bodies plus their investments even in the worst of times we just went through have been paid in full. if not by that company then by the company that takes over their policies.
i would worry more about your own portfolio failing than them.
AIG - once one of the largest, most powerful insurance companies in the world - was almost destroyed by the financial crisis of 2008. The only reason it is still around is because it was bailed out by the federal government and - ultimately - the American taxpayers.
So if the argument is that insurance companies can never fail because the government will be there to bail them out, I suppose that is true only in the trivial sense. The argument exposes the joke for what it is. The true insurance company is really the government. The government is the insurance company of last resort. AIG and others are merely pretenders who are skimming your fees.
So why not bypass these pretenders, avoid paying their fees, and go directly to the real mccoy? Instead of buying annuities, why not just buy TIPS or I-bonds? That way, you'll get your income stream with inflation protection which is backed by the the full faith and credit of the US government to boot.
I never said insurance companies dont fail. They certainly do.. I said the policies have never failed to deliver.thats how the industry is structured.
tips and i-bonds pay less than the annuity stream by alot and im still subject to that stream being inconsistant as it changes or the bonds mature. you still bear 100% of the market risk with them. your talking 4k vs about 6k today in income stream.
I went to the Cox School of Business at Southern Methodist University with Ed Easterling and in his new
book, Probable Outcomes, he predicts the 'new normal' return on stocks is 6%
That's my point. No one needs oil, because we've got you chained in the galley rowing to your heart's content. And all the members of your family, who have learned their work ethic from you.
Transport vehicles are needed, with some motive power. And you're willing, even chomping at the bit, to get in there and row. And when you produce things with your tireless and busy little hands, transport is needed to get them to market. Or else, you're not "working", you're just gloating about how you imagine that you can be a survivalist.
I went to the Cox School of Business at Southern Methodist University with Ed Easterling and in his new
book, Probable Outcomes, he predicts the 'new normal' return on stocks is 6%
for retirees, couple that with zero return on money markets, 1% on cd's and 2-3.5% on bonds and a 40/60 or 50/50 mix is in great danger of failure even if the market does not take a dip. its even more damaging if it does .
thats my point to this whole discussion. like it or not or want to believe it or not we are living that 10% chance of failure you always here about.
for retirees, couple that with zero return on money markets, 1% on cd's and 2-3.5% on bonds and a 40/60 or 50/50 mix is in great danger of failure even if the market does not take a dip. its even more damaging if it does .
thats my point to this whole discussion. like it or not or want to believe it or not we are living that 10% chance of failure you always here about.
I'm not sure you need to live with that much risk. If you diversify, and make sure that at least 20% of your holdings are in portable tender (10% US physical cash and 10% physical gold), then no matter what happens, you will have a pad, to get you through the early crisis, and enable you to sort out your position and see what you need to do to survive. And, you'll be that far ahead of those who lost everything, which might be most people.
Give up a couple points of income, for security that you'll not be penniless.
That's my point. No one needs oil, because we've got you chained in the galley rowing to your heart's content. And all the members of your family, who have learned their work ethic from you.
.
What family? Who needs family?
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
