Health Insurance Quotes

Annuities (advanced)

Important Factors

  • Investment Objectives – MOST IMPORTANT FACTORS
  • Investment Policies
  • Quality of Management
  • Risk Factors
  • Convenience and Services
  • Special Features
  • Minimum Purchase Requirements
  • Sales and distribution charges

Investment Objectives

  • Preservation of capital – keeping money safe by purchasing
    high grade bonds and money market securities.
  • Current income – investments that pay interest and dividends
    (bonds, preferred stocks, high yielding common stocks, income funds, etc.)
  • Growth of invested capital – buying stocks of growth companies that
    reinvest money instead of paying dividends.

Performance Statics – examined may include:

  • Total Return – gains and income
  • Total Yield – income

Investment Strategies

  • Diversification – Investors can minimize the risk that a particular security might decrease in value by diversifying investments (buying several different securities or funds at once).
    NOTE: Diversification reduces business risk, but does not eliminate market risk or interest risk.
  • Defensive Investment Strategy – investing a large portion of the portfolio in bonds and a small portion in equity securities.
  • Aggressive Investment Strategy – investing a large portion of the portfolio in equity securities and a small portion in bonds.

Financial Status

  • Yearly income
    – Ex: mortgage, college expenses, insurance etc.
  • Discretionary income – Income that is not needed for necessities (money that can be risked)
  • Assets and liabilities – What the investor owns as compared to what he or she owes
    Assets: cash, securities, cars, properties, etc.
    Liabilities: rent, mortgage payments, taxes, car payments, bills, etc.
    NOTE: Net worth = Assets – Liabilities
  • Liquid assets – cash, liquid securities, etc.
  • Insurance needs – Life, Health, etc.
  • Participation in retirement programs – IRAs, Keogh, Pension Plans, etc.
  • Tax status – Tax bracket. Does the investor have the need for additional write-offs?

Risk Tolerance

  • Short and long-term liquidity needs – Child going college, buying a house, retiring soon, etc.
  • Fluctuations in value of invested capital – Can investors handle the ups and downs of the market?
  • Income level changes – Expecting a raise, retiring soon, etc.
  • Purchasing power of income and/or principal – Can investors handle inflation risk if keeping money safe?