What Is a Reasonable Rate of Return** In Retirement?

Three Core Principles

Here at Safe Harbor Retirement Solutions, we work hard to help retirees protect what they’ve worked so hard to have. With this mission in mind, we’ve assisted thousands of people in Minnesota to discover the keys to a successful retirement.

It’s not unusual that many clients ask us “What is a reasonable rate of return** in retirement?”. They want to know how to keep their money safe and see the potential for interest growth at the same time.

We have three core principles that we make sure our clients understand:


Retirement doesn’t need to be complicated. Your strategy should be simple. Reduce as much uncertainty as possible in shaping a financial future.


Safety comes first. Focus on preserving your principal.


Achieve a reasonable rate of return** (while protecting your principal).

Understanding Reasonable Rates of Return**

So, what exactly is a reasonable rate of return?** One benefit of a fixed index annuity is that its return rate is not based on the stock market. In contrast, an annuity is a contract between you and an insurance company. However, the range calculated by the insurance company is dependant on various factors including:

  • The dollar amount placed into the annuity
  • The length of the annuity or annuity term
  • Contract terms and conditions set by the insurance company providing the annuity
  • Whether or not you have an income rider
  • Any additional benefits of the annuity

You Deserve a Reasonable Rate of Return** for Retirement

So do you have to choose between earning money or protecting it? Thankfully, the answer is no. A reasonable rate of return (RRR)** is achievable with the right retirement strategy. Certain annuities or life insurance products allow you to protect your principle and still achieve a  reasonable rate of return (RRR).**

An alternative way to look at reasonable rates of return (RRR)** is to examine your risk tolerance. How much money do you want to protect? How much money are you willing to risk? To get the reasonable rate of return** you are looking for you need to find the right combination of “safety vs. possible growth” and “risk vs. potential reward”. The goal is to have your money earning more than the rate of inflation without taking on the risk of the stock market. At Safe Harbor Retirement Solutions we believe that not only do you deserve to feel confident about the safety of your principal but you also deserve a reasonable rate of return.** Our services help our clients achieve what they might call “the best of both worlds.”

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You Have Questions,

We Have Answers

Here at Safe Harbor Retirement Solutions, our purpose is to educate our clients on all their considerations. That way, you can pick the strategy most suitable for you. How you invest or spend your money is important because it impacts your long-term retirement income and lifestyle. If you want to make sure your money performs, you need to understand your options. For example, a fixed index annuity (FIA) can offer potential indexed interest when the market is up. But, when the market is down, your principal is untouched.

financial advisor shaking hands with senior man what is a reasonable rate of return on retirement investments white bear lake mn

Too Much Risk

or Too Little Reward?

Numerous retirees will learn quickly that low interest simply won’t provide them with enough retirement income to live off of. If you can’t create enough income to cover all your costs of living, it might not be the right place for your money. Many clients feel that playing it safe with these types of investments isn’t the best fit for their needs. Which brings us back to the question, “What is a reasonable rate of return?”**

As an alternative to low-interest savings, bonds, or CDs, many retirees invest in higher interest rate choices. The most often overlooked consideration about this alternative is this: your funds are more at risk now. The challenge here is that most of the time, when the interest rate rises, so does the risk. What happens to your funds if the stock market crashes? Will your investment returns be enough? Or will you need to return to work to recoup your losses? That is a situation no retiree wants to be in.

In a best-case scenario, you want your interest rate to be higher than the most conservative choices, but you also need to keep your money safe. This where specific types of annuities and life insurance products can play a role. Certain insurance products, such as a fixed index annuity (FIA) can keep your money safe yet still having the potential for indexed interest. Many retirees look to first protect their savings, and then potentially earn a return.

Interested in learning more about these options? Call us today to set up your no-cost, no-obligation, educational one-on-one meeting.

Safe Harbor Retirement Solutions Helps You Create

A Strategy Tailored to Your Unique Situation

It’s important to note that no retirement strategy is the same. Everybody’s financial and personal situations are different. That is why the first thing we take the time to learn about your goals and needs. We want to know what is important to you. Next, we will review your retirement account’s performance, and then we will go over options that can help protect and grow your wealth.

When you’re ready to take the next step, we are here to help. We provide no-cost education, one-on-one meetings, and financial reviews to help you make the right choices for your retirement.

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