3-6% (almost) risk free return?!

I went to see a presentation last night by this guy who bills himself as Leverage Planners:

I was curious about the word leverage, as to me it means "trading with borrowed money."

The presentation started with an area that I'm familiar with from watching TastyTrade, the crazy and often hidden fees in many investment vehicles like mutual funds. I appreciated this, as well as the discussion of the standard pitch that most advisers give ("stock market always goes up over the long term; diversify with bonds as you age") and how this doesn't apply right now as the stock market it back up near its record high and the bond market is high also but under pressure from incipient interest rate increases.

 The main pitch was for fixed annuity products that are supposed to return 3-6% per year on average, sometimes more (capped around 15%) but which cannot lose money.   The investment isn't in the market, but instead is essentially lent to an insurance company. These companies have large capital requirements and the money has to come from somewhere ... this is one way they do it.

It certainly looks worth a look for anybody who's risk-averse with at least a 10-year time horizon. (I still think I can do better trading futures and options; we'll see!)

This company is local to the Seattle area; if you're elsewhere (hi Lucy!) you want to look for a financial planner who's a fiduciary, meaning he or she will be acting in your interest as first priority.

Basic your risks are two:

• The insurance company could go out of business
• You could need a big chunk of the money sooner than you think

The first one you can handle by dealing with only A rated companies, which your planner should be able to help you find. The second you deal with by only investing money you're sure you won't need for the 10-year period the money will be tied up. (You can take 10% out per year with no penalty in the plans the guy showed us last night.)

I hope this works for you, risk-averse friends!