Which is a better plan for retirement?

Question

I am 30 years old and make about 65,000 per year. I just got a new retirement guy who switched me from a 5% fixed annuity to a mutual fund that is very diversified. Is this a good idea? I know it is risky, but is the return worth it.? Is now a good time to switch?

Answer 1

Annuities are legalized robberies and anything is better.

Your MF seems good, but we need more info on it to express a definite opinion.

Answer 2

Switch?  What do you mean switch?

A 30 yo making 65k should not be in annuity, period.  That was a very bad choice.

What mutual fund?  What are the fees?  Does the account have feeds?  Is this an IRA, 401(k), what?

You have not given us enough information to judge your situation fairly.

***EDIT****

Oh.  403(b).  That's a bird of a rather different feather.  As a general note, if half of 401(k) plans are c**p, then 75% of 403(b) plans are c**p:  fees are very high and choices are very bad.

Annunities are typical in 403(b), so EDIT my comments to make them a little less harsh, if you wish. But, a 30 yo making a good income does not belong in an annunity.

What you want to look for in a mutual fund is one you can stay in for a very long time (10+ years without changing): low fees, no commissions, diversified between large and small stocks; and US and international stocks.

In a perfect world, my benchmark for you would be the Vanguard Target 2045 fund (that's what I would put you in if I could choose anything out there).

In a less perfect world, I would aim for something like 50% US Total US Stock Market Index Fund and 50% Total International Stock Market Index Fund.

Answer 3

Annuities are bad, especially for a young person.  You want to be invested in diversified but fairly aggressive mutual funds.