I am 48 and my husband is 54. We have approximately $60,000 left in our retirement accounts. We want to move our money into something so that it will grow. We've been looking at annuities. We've talked to four different advisers about what is best for us, but I'm overwhelmed with the differences.

Two advisers showed me Allianz, Aviva, and Jackson annuities. The last guy I talked to said we didn't need anything with more than five years for the adviser to make commissions. One guy said that a Fidelity and Guaranty Life (Prosperity Elite 14) annuity would be great for my husband because he has multiple health problems. However, the last guy I talked to said this was a bad annuity because the adviser would make a 4% commission off us for 14 years.

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    When you say you have $60,000 left left it sounds like you used to have more (maybe much more) and you have been running it down. Is that the case? If so, what is causing you draw on it in your pre-retirement years instead of adding more savings to it? (Or do you both consider yourself early retired?)?
    – Chelonian
    Dec 17, 2011 at 21:27

6 Answers 6


I'm going to discuss this, in general, as specific investment advice isn't allowed here.

What type of account is the $60K in now? I mean - Is it in a 401(k), IRA or regular account/CD/money market?

You are still working? Does your company offer any kind of matched 401(k)? If so, take advantage of that right up the level they'll match. If not, are you currently depositing to pretax IRAs? You can't just deposit that $60K into an IRA if it isn't already, but you can put $11k/yr ($5 for you, $6K for hubby if you make $11K or more this year.)

Now, disclaimer, I am anti-annuity. Like many who are pro or con on issues, this is my nature. The one type of annuity I actually like is the Immediate Annuity. The link is not for an end company, it shows quotes from many and is meant as an example. Today, a 65 yr old man can get $600/mo with a $100K purchase. This is 7.2%, in an economy in which rates are sub 3%. You give up principal in exchange for this higher annual return.

This is a viable solution for the just-retired person whose money will run out when looking at a 4-5% withdrawal but 1% CD rate. In general, these products are no more complex that what I just described, unlike annuities sold to younger fold which combine high fees with returns that are so complex to describe that most agents can't keep their story straight.

Aside from the immediate flavor, all other annuities are partial sold (there's a quote among finance folk - "annuities are sold, not bought") based on their tax deferral features. I don't suspect you are in a tax bracket where that feature has any value to you.

At 48/54, with at least 10 years ahead of you, I'd research 'diversification' and 'asset allocation'. Even $60K is enough to proper invest these funds until you retire and then decide what's right for you.

Beginners' Guide to Asset Allocation, Diversification, and Rebalancing is an interesting introduction, and it's written by the SEC, so your tax dollars paid for it. Some months ago, I wrote Diversifying to Reduce Risk, which falls short of a complete discussion of asset allocation, but it does illustrate the power of being in a stock/bond mix. The ups and downs were reduced significantly compared to the all stock portfolio.

(for follow up or to help others reply to you, a bit more detail on the current investments, and how you are devastated, eg was there a huge loss from what you had a few years ago?)

Edit - The original poster hasn't returned. Posted the question and left. It's unfortunate as this was someone who would benefit from the dialog, and the answers here can help others in a similar position, but I feel more discussion is in order for the OP. Last, I caught a downvote on my reply today. I take no offense, but curious which part of my answer the DVer disagreed with.

  • There's one Q+A about 'diversification' and 'asset allocation' here. Do you have any other links to recommend?
    – ChrisW
    Dec 17, 2011 at 18:18
  • I'll revisit and add this. I hesitated to go on too long, as I was waiting to see if my anti-annuity stance was a delete risk. I trust that avoiding ad hominem remarks kept me safe. Dec 17, 2011 at 19:35
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    I find advice more more actionable when it's positive: "Do X", not "Don't do Y".
    – ChrisW
    Dec 18, 2011 at 15:10
  • Agreed, Chris. You caught my visceral overreaction to someone about to get ripped off. I've updated two links to help the asset allocation spin. Dec 18, 2011 at 17:15

It sounds like the kinds of planners you're talking to might be a poor fit, because they are essentially salespersons selling investments for a commission.

Some thoughts on finding a financial planner

The good kind of financial planner is going to be able to do a comprehensive plan - look at your whole life, goals, and non-investment issues such as insurance. You should expect to get a document with a Monte Carlo simulation showing your odds of success if you stick to the plan; for investments, you should expect to see a recommended asset allocation and an emphasis on low-cost no-commission (commission is "load") funds.

See some of the other questions from past posts, for example What exactly can a financial advisor do for me, and is it worth the money?

A good place to start for a planner might be http://napfa.org ; there's also a franchise of planners providing hourly advice called the Garrett Planning Network, I helped my mom hire someone from them and she was very happy, though I do think your results would depend mostly on the individual rather than the franchise. Anyway see http://www.garrettplanningnetwork.com/map.html , they do require planners to be fee-only and working on their CFP credential.

You should really look for the Certified Financial Planner (CFP) credential. There are a lot of credentials out there, but many of them mean very little, and others might be hard to get but not mean the right thing. Some other meaningful ones include Chartered Financial Analyst (CFA) which would be a solid investment expert, though not necessarily someone knowledgeable in financial planning generally; and IRS Enrolled Agent, which means someone who knows a lot about taxes. A CPA (accountant) would also be pretty meaningful. A law degree (and estate law know-how) is very relevant to many planning situations, too.

Some not-very-meaningful certifications include Certified Mutual Fund Specialist (which isn't bogus, but it's much easier to get than CFP or CFA); Registered Investment Adviser (RIA) which mostly means the person is supposed to understand securities fraud laws, but doesn't mean they know a lot about financial planning. There are some pretty bogus certifications out there, many have "retirement" or "senior" in the name.

A good question for any planner is "Are you a fiduciary?" which means are they legally required to act in your interests and not their own. Most sales-oriented advisors are not fiduciaries; they wouldn't charge you a big sales commission if they were, and they are not "on your side" legally speaking.

It's a good idea to check with your state regulators or the SEC to confirm that your advisor is registered and ask if they have had any complaints. (Small advisors usually register with the state and larger ones with the federal SEC). If they are registered, they may still be a salesperson who isn't acting in your interests, but at least they are following the law. You can also see if they've been in trouble in the past. When looking for a planner, one firm I found had a professional looking web site and didn't seem sketchy at all, but the state said they were not properly registered and not in compliance.

Other ideas

A good book is: http://www.amazon.com/Smart-Simple-Financial-Strategies-People/dp/0743269942 it's very approachable and you'd feel more confident talking to someone maybe with more background information.

For companies to work with, stick to the ones that are very consumer-friendly and sell no-load funds. Vanguard is probably the one you'll hear about most. But T. Rowe Price, Fidelity, USAA are some other good names. Fidelity is a bit of a mixture, with some cheap consumer-friendly investments and other products that are less so.

Avoid companies that are all about charging commission: pretty much anyone selling an annuity is probably bad news. Annuities have some valid uses but mostly they are a bad deal.

Not knowing your specific situation in any detail, it's very likely that 60k is not nearly enough, and that making the right investment choices will make only a small difference. You could invest poorly and maybe end up with 50K when you retire, or invest well and maybe end up with 80-90k. But your goal is probably more like a million dollars, or more, and most of that will come from future savings. This is what a planner can help you figure out in detail. It's virtually certain that any planner who is for real, and not a ripoff salesperson, will talk a lot about how much you need to save and so forth, not just about choosing investments.

Don't be afraid to pay for a planner. It's well worth it to pay someone a thousand dollars for a really thorough, fiduciary plan with your interests foremost. The "free" planners who get a commission are going to get a whole lot more than a thousand dollars out of you, even though you won't write a check directly. Be sure to convert those mutual fund expense ratios and sales commissions into actual dollar amounts!

To summarize: find someone you're paying, not someone getting a commission; look for that CFP credential showing they passed a demanding exam; maybe read a quick and easy book like the one I mentioned just so you know what the advisor is talking about; and don't rush into anything!

And btw, I think you ought to be fine with a solid plan. You and your husband have time remaining to work with.

Good luck.

  • 5
    As I re-read this, I am more concerned about this woman. The words "I'm the only one saving for myself for my retirement" are disconcerting. At 49, with a 56 yr old wife (so close in ages to this couple) we have 12X our income saved for retirement, and while we're not too miserable, I don't 'sleep like a baby.' Why is her husband not contributing? When do they plan to retire? I agree they may need professional help, but it will be a consult. A planner will not take on this small sum to manage. Dec 18, 2011 at 0:41
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    I would think Debra could find a planner happy to work with her on an hourly basis or with a flat fee for a comprehensive plan. Vanguard and USAA both offer that service if nothing else, though I think someone local and in-person is better for talking about emotional, complex issues. The right empathetic person could replace fear with facts: run the numbers, look at the options. The options might not be perfect, but I'm sure there will be some workable ones. 60,000 is a lot better than nothing, or being deeply in debt, and getting serious at 48 is a lot better than at 68.
    – Havoc P
    Dec 18, 2011 at 3:59
  • Fair enough. A fee based planner can be valuable, agreed. But still - where is hubby in all of this? Dec 18, 2011 at 4:39
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    @ JoeTaxpayer : It is possible, and she has mentioned it already, that that the apparent lethagy might possibly be due to health issues. My uncle suffers from hyperthyroidism and I know how that turns a person from a go-getter to one who cannot make his body follow his brain. Dec 18, 2011 at 17:52
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    @JoeTaxpayer I saw this and I so know what you mean. I am a widow and age 45 and I don't know what to tell this lady. You and Havoc both gave some good ideas. But I'm still doubtful that any of the very fine list of credentials that Havoc gave (which is good enough to be designated a Community Wiki, actually), well what I mean to say is, that any of those folks will be accessible to someone with 60K to invest. And agreed, what is the story with the husband, I can't tell for certain if he is/ is not working, helping saving or not. Dec 18, 2011 at 18:43

I'll be blunt.

  1. Plan to not retire. Hopefully that didn't hurt too much, but if it did, better now than in 10 years. $60k this late in the game isn't much. Build a side business that will supplement or eventually replace your income at your current careers. If you're good at something, provide it as a service to people who need it. If not, get good at something that you can do for the rest of your life. Spend ten hours a week for two years and you'll be competent at it. Also, save like crazy, take care of your health as best you can, and scale back.
  2. If you're confused by an investment that someone is selling you, don't buy it. Only invest in what you understand. Part of this is understanding how the person selling you the product makes their money, and how much. (Hint: for the products you're looking at, it's a lot.)

When you say:

I am 48 and my husband is 54. We have approx. 60,000.00 left in our retirement accounts. We want to move our money into something so our money will grow. We've been looking at annunities. We've talked to 4 different advisors about what is best for us. Bad mistake, I am so overwhelmed with the differences they all have til I can't even think straight anymore.

  • What type of "growth" are you looking for?
    • Investing is not like "Jack and the Beanstalk"!
  • Do you realize what your time horizon is?

@Havoc P is correct:

...It's very likely that 60k is not nearly enough, and that making the right investment choices will make only a small difference. You could invest poorly and maybe end up with 50K when you retire, or invest well and maybe end up with 80-90k. But your goal is probably more like a million dollars, or more, and most of that will come from future savings. This is what a planner can help you figure out in detail.

  • It would be fantastic if 20-somethings and 30-somethings could learn from your experience.
    • To his credit, Dave Ramsey is screaming at the top of his lungs, trying to help the next generation to avoid your very situation.
    • He repeatedly warns working families about "Murphy's Law" (i.e. family member illness, job loss, etc.).
    • He insists that they save a significant portion of their paychecks for retirement.
    • And he reminds them that they don't "need" that new car or family vacation to Florida.
  • With the benefit of hindsight, regardless of your income, you should have been on a lower standard of living during your 20s and 30s.
    • Because now, you cannot rely on the power of compounding to the degree that you could when you and your spouse were younger. [Link 1] [Link 2]


Here is my advice:

  • Live on rice and beans, beans and rice.
    • Be thrifty; and save like nobody's business.
  • Buy Dave Ramsey's 'The Total Money Makeover'. [It's $0.98 used on Amazon.com]
    • Maybe you could even call into Dave Ramsey's talk show for some additional encouragement.
  • As @Havoc P suggested, hook up with a trustworthy financial planner that has the heart of a teacher that will help you solidify your financial plan.
    • Financial advisers (even well-meaning ones, but especially commission based ones) will have compensation incentives that won't be aligned with your best interests.
    • You should be able to find a trustworthy financial planner here.

The answers you've received already are very good. I truly sympathize with your situation.

In general, it makes sense to try to build off of existing relationships. Here are a few ideas:

  • Have you asked at your workplace? Specifically, the Employee Benefits area within the Human Resources Department?

I don't know if you work for a small or large company, or local/state government. But if there is any kind of retirement planning through your workplace, make sure to investigate that. Those people are usually already paid something for their services by your employer, so they should have less of an interest in making money off you directly.

  • Your bank or credit union. If you trust the people where you have your checking account, had good experiences, ask them about financial advisory services. This can vary a lot by bank and locale and luck. E.g. I had awful experiences with Chase but great with Wells Fargo.

One more thought: A no-fee brokerage company e.g. Charles Schwab. They offer a free one hour phone call with an investment adviser if you invest at least $25K. I personally had very good experiences with them.

This answer may be too anecdotal and not specifically address the annuity dilemma you mentioned. That annunity dilemma is why you need to find someone you can trust, who is competent (see the credentials for financial advisers mentioned in the other answers), and will work the numbers out with you.


Get a job, if you don't have one right now. Take deductions from your paycheck for an IRA or 401K if the company has one.

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