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Generate Retirement Income With Immediate Annuities


Planning for an uncertain economic future has become a passion for many people, especially those nearing retirement. One way to take some of the guesswork out of your planning is to generate retirement income with immediate annuities.

Generate retirement income with immediate annuities

Buying an immediate annuity is something like creating a pension plan for yourself. Here — very briefly — is how it works. When you purchase an annuity, you turn over part (or all) of your retirement savings to an insurance company and in return, you receive a monthly payment for the rest of your life. It certainly takes the guesswork out of retirement investing!

You can buy an immediate annuity where the monthly income is fixed at a specific dollar amount or, if you want to spend more, your income can be increased at a fixed annual rate, say three percent, or can be adjusted for inflation. An inflation-adjusted annuity neatly takes care of two significant risks that you face in retirement — the risk of inflation and the risk of outliving your retirement savings.

You can also protect your spouse or partner with a joint and survivor annuity, which pays a monthly income as long as either one of you is alive.

The downside — and there always is one — is that once you’ve made the decision, you’re usually stuck; with most companies, the decision is irrevocable. “Once you give control of your money to the insurance company, usually you can’t change your mind and get your money back or access your savings.”

An immediate annuity can often provide a higher monthly “paycheck” than other options. As you consider the best way to prepare for your retirement, you may want to generate retirement income with monthly annuities.

Click here to read more about how to generate retirement income with monthly annuities.

Posted in Creating a Personalized Retirement Plan, Planning for Your Retirement, Retirement Investment OptionsComments (0)


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