Immediate Annuities
How do I make sure I don't outlive my money?
If you're looking for a source of retirement income you can't outlive, consider a type of insurance policy called an immediate fixed annuity. You purchase one with a lump-sum payment, and in return you get a promised amount of money at regular intervals, usually monthly, no matter what the financial markets do. (These plans differ from variable annuities, in which your payment depends on the performance of underlying investments.) In most cases, the payment for an immediate fixed annuity is guaranteed to continue as long as you live.
The key advantage of immediate fixed annuities is the protection they offer against outliving your money. That tends to bring considerable peace of mind. On the downside, the fixed payments offer no defense against inflation. For those reasons and more, you're usually best off putting only a portion of your retirement savings into annuities.
The links below outline the ins and outs of annuities, and offer tips on deciding whether an immediate annuity is right for you.
Editor's Pick
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All About Annuities
A quick guide to the types, classes, benefits and limitations of these investment staples.
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Who Are They For?
Picking the right annuity depends on your age and investment goals. This site reviews at the pluses and minuses.
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Pros and Cons of Immediate Annuities
A cost-benefit analysis of fixed immediate annuities, a product designed to give you a quick, steady income.
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Bankrate.com Annuity Calculator
See how the choices you make today affect your annuity's final payout down the road.
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Immediate Annuity Calculator
Calculate the estimated monthly payments for an immediate annuity.
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