Financial expert Huang Xiaodong recently discussed the fluctuations in the stock market and how they have impacted many people’s 401(k) accounts, with values swinging more than 20% over the past year. We asked him how individuals can protect and grow their retirement savings in these turbulent times.

Huang highlighted the various types of annuities available today, emphasizing their pros and cons.

1. **Lifetime Income Annuity**: This annuity offers a 25% bonus into the retirement income account upon opening. It protects the account from losses during market downturns and allows it to grow by up to 250% of the index during market upswing. After ten years, individuals can begin to withdraw retirement income, which is locked in at that time and continues to rise in line with the index. For instance, if someone invests $100,000 at age 55 and starts withdrawing at 65, they could receive $23,000 annually, ensuring that their income never decreases. Moreover, any remaining amount can be passed on to family members.

2. **Guaranteed Lifetime Income Annuity**: This option guarantees a 20% opening bonus, meaning a $100,000 investment nets an additional $30,000 right away. With a guaranteed annual growth rate of 10% over the first ten years, this annuity allows immediate withdrawal of guaranteed income for life, benefitting those who invest $100,000 at 60 years old with guaranteed payouts of $13,250 each year until age 95. If they pass away, a remaining balance of $38,000 can be inherited.

3. **Principal-Protected Growth Annuity**: Designed for those seeking safety for their 401(k), this annuity guarantees principal protection and allows individuals to capitalize on market growth. It provides an average income of 10%-12% without any fees and is suitable for transferring funds from riskier stocks or mutual funds.

4. Huang also noted that the above three types of annuities can facilitate a 1035 exchange for older annuities or allow funds from IRAs or 401(k)s to be transferred tax-free, enabling tax-deferred growth. This means faster asset growth without burdening individuals with annual taxes on interest.

5. Additionally, with California’s impending long-term care tax levied at up to 3% annually to help cover soaring long-term care costs, Huang advises purchasing private long-term care insurance as a tax-advantaged alternative. He represents various companies offering flexible plans that can cover one or two people. For example, a 60-year-old couple can secure $6,000 in monthly long-term care coverage for a one-time payment of $134,000, with no lifetime limits and life insurance benefits if care is not needed.

For anyone interested in learning more, Huang conducts free educational seminars each month. The next event is slated for Saturday, October 26, at 2 PM in Fremont. Attendees can register for the in-person or online seminar by calling 408-466-0233 and asking for Ms. Liang.

For those unable to attend, they can contact Huang directly for quotes at 408-466-0232 or via email. Huang is fluent in Cantonese and English and brings 30 years of insurance experience, offering patient and attentive consultations.