How to make your money last as long as you do is the biggest concern for Baby Boomers. In a world of economic uncertainly, retirees are looking more and more for ways to safeguard their money. Enter annuities.

Contrary to what you may have heard about annuities, they’re not all bad.

In an article, How to Not Run Out of Money in Retirement, the author explains why. David Swenson, Chief Investment Officer at Yale University, and the expert interviewed for this article, believes it would be a wise move to include an advanced life deferred annuity in your retirement portfolio.

Without knowing exactly which annuity he is referring to – they are a myriad of annuities being offered in the marketplace – I’m going to assume he’s talking about an annuity with a guaranteed lifetime income stream.

Basically, a guaranteed lifetime income annuity is a contract between you and the provider (usually a life insurance company and preferably an A+-rated life insurance company), that guarantees you a certain amount of income (received monthly, quarterly or annually) in exchange for a certain amount of money that you give to the company, in either a lump sum (single premium) or over a certain period of time (flexible premium).

There are a plethora of benefits that can be added to the basic annuity contract, such as:

✓ Joint life payout, which continues payment to a second annuitant (usually a spouse) when the first annuitant dies

✓Long term care benefit rider

✓Inflation protection rider

One thing to know is that the more benefits you add to the contract, the more you reduce your overall payout. It’s all a matter of priorities, and what you’re trying to accomplish in your portfolio.

One of the biggest complaints about annuities is their complexity, which causes a lot of confusion in the marketplace, not just for consumers, but for some advisors as well. That’s why it’s important to do your due diligence and work with an advisor who understands annuities.

You can start by checking out this article. Enjoy!

Article: How to Not Run Out of Money in Retirement