The biggest fear in retirement isn't running out of investments — it's running out of paychecks. Annuities solve a specific version of that problem: they convert a portion of your savings into guaranteed income that lasts as long as you do.
The two annuity types I work with most.
Fixed annuities
A guaranteed interest rate for a set number of years — similar in feel to a CD but typically with stronger rates and tax-deferred growth. Right for the part of your savings that needs to be safe and predictable.
Fixed indexed annuities
Your principal is protected, but growth is linked to the performance of an index like the S&P 500. In years the market goes up, you participate in the gains up to a cap or with a participation rate. In years the market goes down, you don't lose principal. The trade-off: you give up some upside in exchange for a hard floor.
Where annuities fit in a real retirement plan.
Not every dollar belongs in an annuity. A common approach is to cover essential expenses (housing, food, healthcare, taxes) with guaranteed income from Social Security plus an annuity, and leave the rest of your portfolio invested for growth and discretionary spending.
What I'll do for you.
- Map your essential vs. discretionary expenses against guaranteed income sources
- Compare products from multiple carriers — rates, caps, participation rates, surrender schedules
- Help you understand exactly what you're giving up in exchange for the guarantees
- Coordinate with your existing accounts (401(k), IRA, taxable) to make sure pieces fit together