Mixing investment opportunities can help with retirement income

Nov 15, 2010

When setting up retirement funds, consumers have a number of options.

Having a diversified portfolio of investments can lead to security during retirement.

A recent piece from SmartMoney showed those people relying on capital gains for their retirement may be taking a bit of gamble, depending on when it is they leave the workforce. If it's during a time of growth, investments may hold out. Otherwise, as happened recently during the recession, consumers may be left scrambling for funds.

However, having funds in securities like annuities or bonds can help alleviate that risk, SmartMoney said. When it comes to life insurance-based investments, consumers have options to choose from, experts note.

For example, a fixed-rate annuity may provide a good amount of security, as it allows for a small amount of guaranteed growth. However, that safety comes at the cost of not getting as large a return on the investment that may be offered by other products.

Consumers who want to get more bang for their buck may consider a variable-rate life insurance annuity. While this could result in larger investment returns, buyers should keep in mind they are also tied to riskier options, such as the stock market.

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