Annuities and Income in Retirement

September 28, 2022

What is the best way to produce income in retirement? Do you rely on a company-sponsored retirement plan, your own Individual Retirement Account, a Pension, Social Security, Brokerage account, or rental income? How about an annuity and income in retirement? This consideration has many nuances to consider and is something that is different for each individual’s own circumstances. But the only solution that provides guaranteed income for life, like Social Security, is the annuity, as more and more pensions are being phased out or are non-existent.

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Retirement Income

So, what does that mean by income in retirement? Well, in its basic form it is the transition from relying on a salary, or earnings to pay for the necessities of life, and now relying on income in retirement from savings, investments, possible rental income, or a new career or part-time work.

The considerations must be this. Do you need to strive for the highest accumulation now that you are approaching, or are already in retirement, or do you look for more guarantees? It is recommended that no matter what your personal circumstances are that a portion of your savings should provide a level of guarantees, and that would incorporate the annuity for income in retirement.

Retirement Replacement Income

A simple way to help determine your need is this. First register on www.sss.gov/myaccount. Once there you will be able to see your estimated benefit based on your FRA(Full retirement age). Once you have obtained this number determine how much of your pre-retirement salary you want to replace. Quick example: If you are making $100,00 a year, one example would be replacing 60%, or $60,000, or $5,000 a Month. You can now calculate how much you would need to put into the annuity to produce this amount for life. Now assess your fixed expenses and determine how much will come from Social Security, and how much additional you will need to feel comfortable from a living standpoint. If Social Security is exclusively being spent to take care of your fixed expenses, then you need the additional buffer that an annuity will provide for lifetime retirement income.

Retirement Costs

Whatever your circumstances are costs are going up not just to live. Healthcare, travel, and housing are just a few things that continue to increase. Having an annuity as a part of your retirement plan can give you the peace of mind necessary to outlive what you have saved.

If you need an expert to explain and suggest options with annuities that can provide the guaranteed income for life in retirement that a client or yourself would benefit from, contact the experts at Pinnacle Financial Services, to provide important insight and solutions.

For more information, contact a Pinnacle Financial Services representative today

1 (800) 772-6881 x7731 | sales@pfsinsurance.com

Will Torrance

Will Torrance

Senior Sales Director | Life, Annuity, & LTC

x7790 | wtorrance@pfsinsurance.com

Contact a Pinnacle Representative if you have any questions.

1 (800) 772-6881


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