Your Social Security is inflation adjusted and having an investment pool that includes stocks, bonds including TIPs, REITs will help with inflation. You can buy an inflation adjustment on an income annuity but I personally didn’t like the numbers. Too much to go into here.
The mortality credits are one reason. Imagine buying an income annuity with 1/10 of your money for say $100k at age 65. Yearly income is around $7,300. If you live to be 95 it is still paying. It’s a form of longevity insurance. It’s only for a small portion of your money. The rest is invested. Adding say a 20 year guarantee ensures if you get hit by a bus after one payment, heirs get paid for 19 years and 11 months. I used one just to ensure essential expenses were covered by guaranteed income.
For many folk’s Immediate Annuities are a good deal. Add up your monthly non discretionary expenses, subtract existing guaranteed forms of income you’ll receive in retirement. If there’s a shortfall plugging it with an immediate annuity (with or without an inflation adjustment) might make sense. It did for me,
Nice article. Thank you. Being wealthy, to me at least, just affords a person the ability to relax a little bit. It certainly doesn’t mean flashing the fancy cars and having bragging rights to the latest big vacation. We live in a well off suburb on the coast south of Boston. Being semi retired and also being somewhat wealthy it is nice to just be to throw on jeans, play E Street radio all day and go out to dinner whenever the urge strikes. We drive fairly old cars (10 years) just because we tend to hold onto them. Funny, we’ve had to have them towed a couple of times recently. I told my wife that I wonder if the neighbors are worried about our financial situation. I was attracted to this site initially when I saw I saw that Jonathan Clements developed it. I’ve got his “ Getting Going” articles bookmarked from the WSJ. Always appreciated his wisdom and insight. My best to him right now.
I can relate to this unfortunately. As a financial advisor and CFP I have counseled many families with this same mindset, never thinking I would feel the same. Retired two years ago but recently went back to work at 62 partly because I was bored. Secretly because I hated spending savings. Fortunately I really do love the profession but I need to work on myself to understand this mindset. Thanks for the article.
Comments
Your Social Security is inflation adjusted and having an investment pool that includes stocks, bonds including TIPs, REITs will help with inflation. You can buy an inflation adjustment on an income annuity but I personally didn’t like the numbers. Too much to go into here.
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from April 24, 2025
The mortality credits are one reason. Imagine buying an income annuity with 1/10 of your money for say $100k at age 65. Yearly income is around $7,300. If you live to be 95 it is still paying. It’s a form of longevity insurance. It’s only for a small portion of your money. The rest is invested. Adding say a 20 year guarantee ensures if you get hit by a bus after one payment, heirs get paid for 19 years and 11 months. I used one just to ensure essential expenses were covered by guaranteed income.
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from April 24, 2025
For many folk’s Immediate Annuities are a good deal. Add up your monthly non discretionary expenses, subtract existing guaranteed forms of income you’ll receive in retirement. If there’s a shortfall plugging it with an immediate annuity (with or without an inflation adjustment) might make sense. It did for me,
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from April 24, 2025
Nice article. Thank you. Being wealthy, to me at least, just affords a person the ability to relax a little bit. It certainly doesn’t mean flashing the fancy cars and having bragging rights to the latest big vacation. We live in a well off suburb on the coast south of Boston. Being semi retired and also being somewhat wealthy it is nice to just be to throw on jeans, play E Street radio all day and go out to dinner whenever the urge strikes. We drive fairly old cars (10 years) just because we tend to hold onto them. Funny, we’ve had to have them towed a couple of times recently. I told my wife that I wonder if the neighbors are worried about our financial situation. I was attracted to this site initially when I saw I saw that Jonathan Clements developed it. I’ve got his “ Getting Going” articles bookmarked from the WSJ. Always appreciated his wisdom and insight. My best to him right now.
Post: I don’t feel comfortable being “wealthy”
Link to comment from April 1, 2025
I can relate to this unfortunately. As a financial advisor and CFP I have counseled many families with this same mindset, never thinking I would feel the same. Retired two years ago but recently went back to work at 62 partly because I was bored. Secretly because I hated spending savings. Fortunately I really do love the profession but I need to work on myself to understand this mindset. Thanks for the article.
Post: Loosening My Grip
Link to comment from June 14, 2023