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The Difference Between Investments & Contracts!

By January 12, 2022 No Comments

Although many Savers have both investments AND contracts – most don’t understand the difference between the two. Very simply – an investment is a hope for the best, and a contract is protection from the worst… In a bit more detail:


What is an investment?

Definition – The outlay of money usually for income or profit.
A couple different investments are: Stocks, Bonds, Mutual Funds, ETF’s, Real Estate, Money Market accounts. Some offer much less risk than others, but there is no contractual obligation for your investment.

What is a contract?

Definition – A binding agreement between two or more persons or parties. Legally enforceable.

Most people own contracts whether they know it or not. Insurance policies such as car, home, life and health are all contracts. Another example of a contract, and one that Tony Walker Financial works with often, is an annuity. Simply stated, an annuity is a transfer of stock market risk (backed by a contract) to an insurance company.

Contracts can be very complicated to understand. They are not always written for the best interest of the “little guy.” That is why it is important to have an advisor that is looking for the fine print to make sure that you, the Saver, are receiving the best contract for your specific situation. The unfortunate reality is, although they are legally licensed to sell them, many advisors don’t truly understand that annuities are contracts.

Not only do we understand annuities, but we have proprietary software and educational information to help you understand them as well!

Click the button to download “Annuities Made Easy” or “Insurance Made Easy” for FREE !

Now you may be thinking, is there a way to own both investments and contracts? The answer is very simple – yes you can!

At Tony Walker Financial, we have the WorryFree Split-IRA Concept® which allows you to have the best of both worlds. Through the Charles Schwab platform, we can invest some of your money in the stock market (aligned with your risk tolerance) at a management fee of .8% per year. The other side to the ‘Split-IRA’ provides contractually obligated guaranteed lifetime income which we like to call Mailbox Money®.

Click the video below to hear Tony explain what the difference is between investments and contracts and why it matters to you!



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