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Ask Dave

Annuities And Different Retirement Investments.

Dave gives Chris three options for long-term investments, if he has no debt and has maxed out his retirement accounts.

QUESTION: Chris wants to know about annuities and different retirement investment vehicles. 

If you’re investing long term, have maxed out all of your retirement accounts, and have no debt, do the following:

  1. Buy things that appreciate on a capital gains basis like real estate.  You can buy rental property that goes up in value and it grows tax-deferred.
  2. You could also do annuities.  There are fixed annuities and variable annuities.  I would not do fixed annuities because they are a bad savings account with an insurance company.  A variable annuity gives you some access to mutual funds and allows them to grow without paying taxes on them.
  3. You could also do low turn-over, index mutual funds.  Stocks don’t sell inside the mutual fund very often so you can keep clear of taxes.