What Is a Reasonable Rate of Return?**

One of Three Core Principles

Retire With a Reasonable Rate of Return** Over Time

Many retirees hope to earn a reasonable rate of return** on their contributions in retirement.

At the same time, they want to protect their income. Investments such as the stock market come with a lot of risk. Your tolerance for risk probably decreases as you approach retirement. You want to keep your assets safe, while also earning reasonable returns. Rest assured, this is possible.** One example of a strategy that can get you these benefits is a fixed indexed annuity. This product offers both principal protection and reasonable rates of return.** Helping our clients achieve reasonable returns** is one of our core principles.


Achieving a Good Rate of Return** In Retirement

Successfully planning for retirement means finding financial stability. safety and interest growth must be balanced, as well as risk and reward. The majority of people believe the only way to keep their money safe is in an FDIC-insured account. As an alternative, they may choose to keep money in a CD (certificate of deposit) as security. Neither of these, however, offer very appealing interest rates. Additionally, the interest rate you earn on these accounts will be taxed. So, your net return may be even lower.


Fortunately, you can keep your money safe while earning a reasonable rate of return.** The products we offer can get you what many would consider the best of both worlds. We can help you determine which of the options we offer is the most appropriate fit for you.

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Fixed Indexed Annuities

Fixed indexed annuities (or FIAs) do not invest directly in the stock market. Instead, the issuing insurance company tracks potential earnings based on an external index, such as the S&P 500. The index will give you interest if it rises to a certain point.

woman calculating what is a reasonable rate of return

The rate of return** depends on several factors, including:

  • The annuity period
  • Added benefits
  • Whether or not you have selected an income rider
  • The cost of the FIA
  • Specific contract conditions

Risk-Reward Management

Returns can be reasonable with a number of retirement strategies, but they must be carefully weighed. Some retirement vehicles may provide you with sufficient rates of return, but come with the risk of losing your principal investment. Others may come with more safety and security, but disappointingly low rates of return. Neither of these options is ideal. You should aim for both, the safety of your savings and reasonable rates of return.**


The Right Strategy For You

No single retirement strategy is right for everyone. Each individual’s financial situation is different. When working with you, we’ll take the time to learn about your objectives and needs. Having an understanding of your priorities is important. We can discuss options that will help protect and grow your wealth, and review your existing strategy’s performance.

woman looking at phone smiling what is a reasonable rate of return
You Deserve a Reasonable Rate of Return**

One of Three Core Principles

Expect a Reasonable Rate of Return.**​
Keep your money safe.
Retirement can be simple.

Learn More

Sonoma Financial strives to provide clients with the information they need to make good decisions. We can show you ways of protecting your retirement income. How protected it is dictates you earn and how you live in retirement.  Let us help you get educated. We can help you feel confident about their retirement strategy.

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