Annuities and Inclement Weather
As we enter the new year, many of us are coming off a near-record cold snap, no matter where we live. On Christmas day I was watching the football game being played in Miami and the announcers said that the forecast high was only 42 degrees. I would have taken that here but for a subtropical place that’s pretty chilly. Lots of people reached out to ask how I was handling it and it gave me the idea to share a couple of stories. Just about everyone is dealing with it to some extent so it’s something we all share.
Temperatures here were well below normal but we come to expect it each year so we are prepared for it. Houses are built with extra insulation and heavier beams to handle the snow load. Water pipes are buried four to six feet deep to keep from freezing and all run in the interior of the home to eliminate exposure to cold air. I talked to Pat and Stacey in Texas and they don’t have any of that. So when they felt 16 degrees last week it gave them a whole different set of things to deal with. Texas isn’t used to that so the extra building cost is not justified. Here it’s a requirement.
We had a nice fall this year and it seems when that happens we pay for it later. Winter came fast and hit hard. Single-digit temps and solid snow storms made for some tough driving when I went to Kansas and back in November. The cold reached that far south so I never got a real break from it and things only got worse the further north I came on the return trip. It stayed that way for about a week and then in early December it warmed up for a bit. Things started melting and that set things up for being worse.
Snow melts and the water doesn’t absorb into the frozen ground. It runs across roads, driveways, and parking lots, then freezes at night only to make driving more difficult. It’s easy to spot the people that aren’t from around here. The freeze/thaw cycle is pretty common around here but at one point we had some rain just before a large snowstorm and a serious cold front moved in. One friend who doesn’t live too far from me recorded a low temperature of 39 degrees below zero one morning. That’s about when we zip our coats all the way up.
Driving on the roads was like driving on a block of ice. Tire tracks packed down the snow before plows could come through so add that to the skating rink and it makes for a stressful trip to the grocery store. I have tire chains, a tow rope, and power tools in my truck at all times. I prefer to be prepared to help rather than risk being stuck waiting for help. It costs extra money that most don’t spend but it’s the type of insurance that allows me to confidently travel when everyone is told to stay off the roads. I’ve pulled three people out of the ditch already so it paid off for someone.
Most people who live in the southern states don’t have to prepare for heavy snow loads and freezing pipes. Tire chains and tow ropes might never get used. What use would a person from Texas have for a winter coat? There are some simple things we take for granted that don’t occur to some to be a necessity. Yes, geographically speaking there are lots of different things we each should do to prepare for inclement weather. Even if this cold front reached more people than normal, it’s still a safe bet to move south to avoid the hassle.
What we all do have in common is the need to protect ourselves from inclement financial conditions. I spend money to ensure my comfort in cold weather and I spend money to ensure my comfort during financial storms as well. Emergency savings and life insurance at my age and stuff like long-term care and medicare supplements at your age. It all costs money except for one thing: annuities. To start with, buying an annuity is just shifting assets from one place to a safer place. Throughout this podcast and newsletter, I’ve debunked annuity myths of fees, liquidity, and growth so it makes sense for those who want to sleep well during financially hard times. The debate is over so I don’t want an argument but I’ll explain to anyone who doesn’t understand.
Things you spend money on to preserve comfort are a luxury and that includes annuities. But annuities don’t really cost anything because it’s just shifting your money to another account that holds your money. Asking me if I can handle the cold is like asking one of my clients whether they worry about the stock market and the economy. We are all prepared for it. I’ve made sure of that.
Podcast about Annuities and Inclement Weather
In the same way that we prepare for inclement weather, it is crucial also to protect ourselves from rough financial conditions. These economic storms can leave us vulnerable and without a safety net, so it is essential to have a backup plan and invest in financial insurance, such as annuities.
Annuities can provide a stable income stream and help safeguard our financial well-being in times of economic uncertainty. Don’t wait until it’s too late to prepare – make sure to have a plan in place to protect yourself from financial risks and be ready for any unexpected challenges that may come your way.
What You’ll Learn From This Episode:
[3:15] Annuity and inclement weather
[3:52] Winter came fast and hit hard
[4:27] When we get a bunch of snow, and it melts, that sets things up to even worse scenarios
[5:50] Now Bryan’s ready with his tire changes, tow rope, and power tools to get prepared for the winter season
[7:13] There are a lot of things we should do to prepare for the inclement weather
[11:20] Emergency savings, long-term care, etc., are substantial investments
[11:30] To save money in the future and save time, you have to have preparation
[11:47] To start buying an annuity is just shifting assets from one place to a safer place
Key Quotes:
[5:55] “I carry all that stuff because I prefer to help instead of risk being stuck waiting for help.”
[12:07] “Annuities don’t cost you anything.”
Resources:
Further readings
Fixed Indexed Annuity Withdrawals
How Much Do Fixed Annuities Pay?
Last Updated on May 10, 2024 by Bryan Anderson
