HARRISBURG, Pa., April 3, 2017 /PRNewswire-USNewswire/ -- Continuing Governor Wolf's consumer protection initiative, Insurance Commissioner Teresa Miller and Secretary of Banking and Securities Robin L. Wiessmann announced their departments are joining the National Retirement Planning Coalition to encourage Pennsylvanians to think about their retirement, and to guard against potential scams that could deplete retirement savings. The coalition has designated April 3 - 7 as National Retirement Planning Week 2017.
"As Pennsylvanians approach retirement, they need to think carefully about how best to invest their money to make sure they have the funds they will need for a secure retirement for many years," Commissioner Miller said. "One product often marketed to people near or at retirement age is an annuity. Annuities can be a part of a retirement financial plan, but consumers need to be sure to choose the annuity that is right for them."
The Insurance Department created a brochure titled "The Do's and Don'ts of Annuities," and is working with AARP to help consumers understand more about these products, and to ask questions to help insure they buy the right annuity for their situation.
"Consumers should ask questions about how their money will be invested, and if they aren't sure whether the product offered is right for them, should talk to a financial adviser or trusted friend or family member," Commissioner Miller said. "Consumers should never feel pressured to buy an annuity or other financial product on the spot. If the person selling the annuity pressures you to make a quick decision, that could be a red flag that this is not the best investment for you. If it's a good deal today, it will be a good deal next week or next month."
Commissioner Miller warned that individuals selling annuities will sometimes offer a free meal at a nice restaurant before making a high-pressure sales pitch. Consumers then feel pressured to buy something in return for the free meal or other gift, but should not give in to this pressure.
All annuities must offer a "free-look period," as well. This is a period of time that you can back out of the deal and get all your money back after you have purchased the annuity. Commissioner Miller urged consumers purchasing an annuity to find out how long the free-look period is.
She also noted annuities typically "lock up" a consumer's money for a period of time, often five to ten years, during which the consumer would have to pay a "surrender charge" penalty to withdraw some or all of the money. Commissioner Miller urged consumers to know how long the lock-up period is if they are considering purchasing an annuity.
The Department of Banking and Securities, along with consumer advocates, has identified lack of preparation for retirement as one of the top five barriers to Pennsylvanians achieving financial independence. The department offers programs in communities across Pennsylvania designed to help consumers learn how to grow and protect their money, as well as a free, online library of publications written to help people navigate through the financial marketplace.
The department also co-sponsored "When I'm 65," a documentary film focusing on how Baby Boomers, Gen Xers, and Millennials can prepare for retirement. "When I'm 65" is scheduled to air on WQED (Pittsburgh) at 8 p.m., Monday, May 8.
Along with the Insurance Department and the AARP Consumer Issues Task Force, the department created a series of short videos on retirement savings featuring Pennsylvania residents and experts: "Military Money Secrets," "Fraud: Free Meal Seminars," "Personal Finance in High School," and "Investing in Your 30's."
"With 45 percent of Americans having nothing saved for retirement, our country is facing a serious financial challenge in the coming decades," said Secretary Wiessmann. "In Pennsylvania, we are taking proactive steps to meet the challenge of funding retirement head-on, helping provide information and tools so that our citizens can better plan how to fund their retirements."
The National Retirement Planning Coalition, comprised of prominent education, consumer advocacy, and financial services organizations, in conjunction with the Insured Retirement Institute, has collected the latest resources to help consumers and financial professionals focus on long-term financial goals. These tools are available year-round at www.retireonyourterms.org.
More information on annuities and other insurance issues important to seniors, such as long term care, continuing care, life insurance, and Medicare supplement insurance, is available at www.insurance.pa.gov, by clicking on "Seniors," under "Insurance Coverage Resources."
More information on avoiding scams is available at www.dobs.pa.gov., under "Protect Yourself. Protect Your Money."
Ron Ruman- Insurance, 717-787-3289
Ed Novak, Banking and Securities, 717-783-4721
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SOURCE Pennsylvania Department of Insurance