Annuity Advantages

Every day, there are roughly 10,000 baby boomers retiring and financial experts worry about how well this generation can provide for their golden years.  With so many challenges of investing, policymakers have stressed the significance of giving retirees greater access to annuities within their retirement accounts. 

A core advantage of longevity annuities is that they provide investors with the certainty of knowing they will receive a certain amount of money no matter what happens in the financial markets.  For those who exceed the average life expectancy, longevity annuities p ay off by ensuring monthly payments as long as you are alive to receive them.  If you put a portion of your savings aside toward a longevity annuity, even if you run out of other assets, you will have a minimum baseline income on which to survive.  Thus, longevity annuities provide the same financial stability that Social Security does, with the federal payments also continuing until death. 

While annuities can help boomers get ahead on their financial future, they will not change the underlying problem facing many baby boomers: not having saved enough money. 

See Dan Caplinger, Annuities: Can They Really Save Baby Boomers’ Retirement Dreams? The Motley Fool, Dec. 21, 2014.