Retirement Annuity

Retirement Annuty by Lita M.

When you wave goodbye to your employer for the last time and you are looking forward to fun in the sun on some long overdue vacations will you be wondering about a retirement annuity to look after your income needs?

What will be your source of income at retirement?  Will you have income from a company pension plan? Will you have sufficient income from government pensions? Are you worried about your personal retirement savings and whether or not you have enough or that you should invest in a retirement annuity?

At retirement we are unaware of the length of our remaining life span.  We often need help in determining at what rate to use our savings in combination with our government or company sponsored pension funds.  If you spend your own savings too rapidly you may outlive your resources, however, if you are too cautious you may end up scrimping more than necessary while taking away from your retirement pleasure. A retirement annuity is designed to protect you against the risk of outliving your savings.

Similar to insurance, a retirement annuity is a way of pooling your resources with others to ensure that all of you will be protected against outliving your savings.  Life insurance companies are the only financial institutions regulated to sell a retirement annuity.  The company will accept your savings together with a pool of other investors’ savings and in return will enter into a contract with you that promises to pay you a life income.

Some advantages of a retirement annuity:

• A retirement annuity contract guarantees you a fixed income for life;
• You do not have to make decisions or be involved in handling the investment;
• You do not have to worry how much of your capital to use to ensure that it lasts  for your lifetime;
• Your retirement annuity contract protects you against a depressed investment  climate;
• If you have a small estate this is a useful way of making it last for your lifetime.

A retirement annuity is not a way of making money but it is a way of making your savings last for the remainder of your life.

If you are considering a retirement annuity as an option then speak to your qualified annuity advisor who will help you with the finer details of a retirement annuity as it pertains to your own retirement plan.

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