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Saving for retirement is one of the most important financial steps you can take, but many people are falling behind in this area. A 2023 survey from GOBankingRates found that more than half of Americans have less than $10,000 saved for retirement, while more than two-thirds have less than $50,000. Fewer than one in 10 (6%) have between $100,001 and $200,000.
Those totals are well below what most financial experts recommend. By age 30, you should aim to have at least the equivalent of one year of your annual income saved up for retirement. After that, you should save three times your income by age 40, six times by age 50 and eight times by age 60. This rule is based on the assumption that you save 15% of your income annually from the age of 25 and plan to retire at 67.
To effectively save for retirement, you need to build a diversified portfolio of assets so you aren’t solely dependent on standard retirement accounts such as a 401(k) or IRA. This typically includes putting some of your money in bank products such as high-yield savings accounts or certificates of deposit, and putting some of it in stocks, bonds, mutual funds and other investments.
One way you can complement your retirement savings is through an annuity like the SteadyPace™ annuity offered by Gainbridge®, a self-managed digital platform that gives you access to annuity products that can grow your savings over time. The SteadyPace™ annuity pays a guaranteed APY* on your savings.
Why This is a Smart Way to Boost Your Retirement Savings
In case you need a refresher: An annuity is an insurance product that pays out a fixed amount of money in a series of payments. In some cases, annuities provide a steady source of income for as long as you live. The main function of an annuity is to remove longevity risk for retirees, meaning they don’t have to worry about outliving their savings.
Annuities are divided into two phases:
- Accumulation phase: The accumulation phase, sometimes called the investment phase, is the period during which contributions are made to the account and funds grow. Appreciation during this time is based on contractual guarantees or investment performance, depending on the type of annuity purchased.
- Annuitization phase: The second phase is the annuitization or payout phase. This is when you start receiving payments. The payments can be a lump sum, periodic payments or some combination of the two. The amount paid out is determined by the amount you contributed, the performance of the account, your expected lifespan and the type of distribution you selected.
Annuities can provide a couple of benefits. First, your money is in a safe place that provides steady returns over a long period of time. And second, the money grows through the interest you earn – so it pays to find the best rates.
With SteadyPace™ by Gainbridge®, you’ll earn a guaranteed rate on your retirement savingsof APY* . The savings are tax-deferred as well, which means you don’t pay any income taxes on the annuity until you start to withdraw funds.
SteadyPace’s APY* gives it an edge over many other types of investments. For example, the average rate for a 60-month CD was only 1.40% as of February 20, 2024, according to the FDIC**. The average rate for shorter-term CDs ranged from 0.23% for a one-month CD to 1.83% for a 12-month CD***.
Long-term Treasuries with maturities of 15 years or longer offer rates of around 4.5% for fiscal year 2024, according to TreasuryDirect****.
Bottom Line
Investing in a SteadyPace™ annuity not only guarantees a high rate of return — it also helps you avoid the risk and volatility associated with the stock market. With a SteadyPace™ annuity, you don’t have to worry about the peaks and valleys.
Signing up is simple and can be done in less than 10 minutes, and you can start boosting your retirement income with a guaranteed APY*
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SteadyPace™ is issued by Gainbridge Life Insurance Company in Zionsville, IN. on contract form number ICC22-D-MYGA-BASE, or variations of such. Products and/or features may not be available in all states. Guarantees are based on the claim-paying ability and financial strength of the issuing insurance company.
Annuities are long-term investment vehicles and have charges, termination provisions, and terms for keeping them in force.
*Rates subject to change at any time, and the rate mentioned is for a (#) year term and may no longer be current. Please visit gainbridge.io for current rates, full product disclosures and disclaimer, and other important information.
** FDIC national average rates
*** CD Rates
**** Treasury Direct
This communication is for informational purposes only. It is not intended to provide, and should not be interpreted as individualized investment, legal, or tax advice. To obtain such advice, please consult with your investment, legal, or tax professional.
NOT FDIC/NCUA INSURED | MAY LOSE VALUE | NO BANK/CREDIT UNION GUARANTEE | NOT A DEPOSIT | NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
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