I’m 55 years old with $300k in investments and not sure what to do with it or how to use it effectively

There’s an abundance of advice on how to save for retirement and where to put your money while you’re young, but once you hit retirement age, what do you do with all that money you put away? This is one question a user on r/ChubbyFIRE had for the community.

This is a community for people who are focused on retiring early with an upper-middle-class lifestyle and between $2.5 and $6 million in retirement savings. So, definitely not a normal sample of the typical American citizen, but some of the financial advice they received might still be applicable to those who want to retire soon, or eventually.

The Question

An image of retirement funds growing.

In their post, after the author had given some background about how they have managed to accumulate their savings and where it has been invested, they said they had around $300,000 in an annuity with Fidelity and asked what they should do with it now that they are retiring.

They were planning on using money from a brokerage account for any immediate funds, incorporating Social Security payments in the near future, and then dipping into their retirement savings. However, they weren’t sure where the $300k annuity would fit into their plan, so they came to Reddit to ask for advice from strangers.

What Were The Responses?

A retiree counting money.

Through the handful of responses this post received, there was one clear consensus: don’t do anything until you speak with Fidelity first.

As with most things in the financial world, there are too many rules laws, and tricks to keep track of, and if you start messing with large amounts of money without knowing what you’re doing, you run the risk of incurring huge financial penalties.

In this particular case, there were several reasons why the author should speak with the company first: to determine if it is annuitized, to see if it can be transferred to a brokerage account, and other stipulations and account types that might impact taxes and payment amounts.

Because the types of accounts vary wildly, the best resource for the author to completely understand what they have and how to use it would be Fidelity. It was clear from the comments that not many people felt comfortable giving any concrete advice because if they had the wrong account, or took money out too soon, then it would be a very expensive mistake.

The options of what the author could do with it depend on this information. It could be rolled over into an IRA/Roth IRA, complete a 1035 transfer, trigger the annuity payments, and annuitize, once he retires after reaching age 59.

If you have an annuity with significant amounts of money and are unsure what to do with it, it is important you contact your company to make sure you understand what you have and what you’re allowed to do. Then, contact a financial expert or financial advisor who can give you legal financial advice. You shouldn’t guess when it comes to your finances. Everything you read here, or online, especially on Reddit, is opinion.