Weekend Reading: Why So Many Experts Consider Annuities a Win for Retirees

This article appears as part of Casey Weade's Weekend Reading for Retirees series. Every Friday, Casey highlights four hand-picked articles on trending retirement topics and delivers them straight to your email inbox. Get on the list here.
Weekend reading annuities win for retirees Weekend reading annuities win for retirees
Weekend Reading

Your retirement income strategy should be crafted with the end-goal of providing lifelong income. Amidst recent risk factors such as inflation and market volatility, one way to guarantee that income is by leveraging annuities.


Volatility security: Today’s unique economic climate led annuity sales to increase by 44 percent in 2022 due to their ability to offer income protection in a variety of ways. For one, they provide peace of mind when it comes to longevity risk and an unexpected lifespan, as monthly payments are always guaranteed. Further, during down markets and high inflation, annuities consistently produce higher yields than balanced portfolios.

One piece of the puzzle: While the benefits of incorporating annuities into your retirement portfolio depends on your unique financial situation, they are often utilized in combination with other income sources, such as Social Security or a pension. As for the types of annuity payment contracts, three exist: A single premium immediate annuity (SPIA), qualified longevity annuity (QLAC) and deferred income annuity (DIA), which can be “laddered” by selecting varied start dates.

Creating a lifetime of income has always been a win for retirees, and today, that win is bigger than ever.