How long will you need your assets to last in retirement? 20 years? 25? 50?
Actually isn’t the answer “As long as you do”?
The truth is that you’ll need money for as long as you live, ideally enough money to maintain your lifestyle and even possibly cover the extra expenses that come along with your last years, such as an assisted living facility or a nursing home.
For many years, the bulk of American workers could retire knowing they were covered by a defined benefit plan, a type of retirement plan that would pay an income in retirement that would last for the rest of their life. These plans offered some security in retirement because, regardless of what happened to your other assets, you knew you’d be receiving a check to cover at least some of your expenses
In the 1980’s, 60% of American workers had a Defined Benefit plan. Now, less than 20% do*. That security has greatly diminished for most Americans, with Social Security being the only recurring income for many people. Is there somewhere you can buy some of that recurring income back?
The answer is yes, you can buy an annuity. While annuities have gotten a bad reputation due to their misuse, when allocated as a reasonable portion of your retirement plan, they can provide income with a promise to pay for as long as you live, regardless of what happens to your other assets.
If you’d like to hear more about how annuities could help your financial plan, call our Income and Long Term Care Strategist, Jeremy Udell.
*Source: http://money.cnn.com/retirement/guide/pensions_basics.moneymag/index7.htm
Guarantees are subject to the financial strength and claims-paying ability of the issuing insurance company. Annuities are long-term investments designed for retirement purposes. Annuities can have limitations, exclusions, charges, termination provisions and terms for keeping them in force. All contract guarantees, including optional living and death benefit riders and annuity payout rates, are backed by the claims-paying ability and financial strength of issuing insurance company.