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Annuity
Smart Investor Financial Review "Key questions to ask before buying an annuity"
Chris Morcom, James Frost
Hewison Private Wealth
22 Nov 2016
Chris Morcom has given advice on purchasing an annuity in the latest smart investor publication.
The one question I would ask is, ‘Am I prepared to lock my capital into a relatively low rate of return for the rest of my life for the sake of having certainty of income?’ It comes down to your attitude towards risk and return. If you have a diversified portfolio, you should be able to replicate the same characteristics. If an annuity is providing you with an income stream of $20,000 a year, a substantial part of that return is your capital coming back to you with some interest. What you are betting against is your life expectancy. Fifty per cent of investors who buy an annuity will do well and 50 per cent will not do so well. Annuities provide a guaranteed outcome but that guarantee comes at a cost.
To read full article, please refer to Smart Investor Magazine Page 8 from November 18.
Hewison Private Wealth is a Melbourne based independent financial planning firm. Our financial advisers are highly qualified wealth managers and specialise in self managed super funds (SMSF), financial planning, retirement planning advice and investment portfolio management. If you would like to speak to a financial adviser on how you can secure your financial future please contact us 03 8548 4800, email [email protected] or visit www.hewison.com.auPlease note: The advice provided above is general information only and individuals should seek specialised advice from a qualified financial advisor. The views in this blog are those of the individual and may not represent the general opinion of the firm. Please contact Hewison Private Wealth for more information.