How To Insure Your Roth IRA
If insuring your retirement account against your premature death is important to you, you should consider purchasing an annuity contract for your Roth IRA.
Can you tolerate market risks with the money in your account? If you answered yes, consider a variable annuity. If you answered no, consider a fixed annuity.
Consult with a trusted broker or a life insurance agent to find out what annuity contracts are available. Narrow your search down to annuities that are underwritten by financially strong insurance companies.
If you are considering variable annuities, search for companies that offer mutual funds with investment objectives compatible with your risk tolerance.
Review all of the features, limitations, and flexibility of the annuities carefully. Consider any riders you may want to include, such as living benefits or spousal contribution options.
Be sure to consider the costs associated with the life insurance part of the annuities: the mortality and expense, also known as the “m & e” charges.
Do not forget to include management fees of mutual funds into your costs, if you are looking at variable annuities. Review the income and estate consequences of annuity contracts with your tax advisor or go online to an IRS website.
Choose the type of annuity that is best for you and your retirement planning goals.