A survey by Allianz Life found 64% of Americans worry about running out of money in retirement more than death, as reported by Yahoo Finance. This makes guaranteed income sources very important for peace of mind. Annuities are contracts with insurance companies that pay a fixed amount of money either immediately or in the future.
How annuities give lifetime income
You pay premiums over time or a lump sum, and in return, you get guaranteed income for life. Just like Social Security, annuities ensure your money does not run out if you pick a lifetime guarantee. There are many types of annuities: variable, indexed, lifetime, or fixed-term.
Flexible annuity options
You can choose how to pay and how to receive income. This flexibility lets you customize your retirement plan while reducing the risks compared to volatile stock investments, as stated by Yahoo Finance. For people who are risk-averse, annuities can provide confidence and security.
Annuities give regular monthly payments
Annuities can pay monthly, quarterly, or yearly, depending on what you choose. Monthly payouts help replicate a paycheck-style income, making budgeting easier, as stated in the report by Yahoo Finance. This reduces stress compared to managing withdrawals from investments, giving retirees a predictable stream of money for bills and daily expenses.
Many Americans are realizing they can retire earlier than expected by combining Social Security with annuities. Answering three simple questions can help people rework their retirement portfolios and plan better. Social Security is a good start but often not enough. Adding an annuity can fill the gap, provide regular income, and reduce financial stress. Experts say considering annuities now can make retirement more secure and enjoyable.
FAQs
Q1. Can annuities make my Social Security income enough for retirement?
Yes, annuities can add guaranteed income to Social Security and help cover the gap for a secure retirement.
Q2. How do annuities pay money in retirement?
Annuities can pay monthly, quarterly, or yearly, giving a steady income like a paycheck.