- The first is flexibility. Once you give your money to an insurance company you usually can’t get it back (although some will let you take a one-time withdrawal for emergencies). That’s the reason most planners recommend investing no more than 25% to 30% of your savings in an annuity.
- The second is that payments usually aren’t adjusted for inflation. You can buy an annuity with an inflation rider, but it will lower your initial payout by about 28%.
- The third — and most significant — drawback is that low interest rates will depress your payouts, effectively making annuities more expensive now. Payouts are usually tied to rates for 10-year Treasuries, which are at a record low.
Each month, we issue The Mike’s Buy List for our DSR members. They get our best ideas for both U.S. and Canadian dividend stocks. The first Friday of each month, they receive our top 10 growth and top 10 retirement (yield over 4%+) investment ideas.
As we prepare for another surge of COVID-19 cases, it’s more important than ever to have the right holdings in your portfolio. Last time, I covered two dividend growth stocks. Now, let’s cover two options for income-seeking investors.
3M Co. (NYSE:MMM)
What’s the story?
This giant doesn’t need much presentation. It’s probably on many investors’ watch list too… but it rarely is on sale!
3M had some good news for investors during September. It reported August sales growth of 2% Y/Y to $2.7 billion, led by a 23% rise in Health Care. Organic local currency sales declined 2%, while acquisitions, net of divestitures, and foreign