Longevity

A list of ten risks faced by retirees includes the obvious such as stock market risk , but also includes issues that may not be top-of-mind for many retirees such as inflation risk and interest rate risk . Longevity risk is at the top of the list. Immediate annuities and the longevity annuity are mentioned as a potential solutions to the risk of outliving one's assets: "Given that, what's the best way to manage that risk? Social Security , traditional pensions and payout annuities all promise...

One in three baby boomers is expected to live into their nineties. Longevity risk or the possibility of outliving one's assets is something that should be considered by all near and current retirees. Longevity insurance or a longevity annuity is one of the most efficient ways to hedge longevity risk. Relatively large amounts of guaranteed income later in life can provide peace-of-mind and financial flexibility earlier in retirement. "Because the insurance company has held your money for a long...

Article discusses the importance of immediate annuities--particularly in light of hedging longevity risk . Pros and cons of immediate annuities relative to other forms such as variable and indexed annuities are addressed. A solid article written by an attorney that is likely focused more on an advisor than a consumer audience. "The retirement crisis facing our country for the next 15 years is profound. The Social Security system is under great pressure, lifetime pensions guaranteed by employers...

The financial crisis has resulted in renewed interest in immediate annuities which can be used to lock-in stable, guaranteed income for a lifetime. "An immediate annuity can function just like a pension , producing a predictable payout. As the "immediate' part of the name suggests, the distributions start shortly after the money is invested." Longevity risk , inflation protection, how much to annuitize , and adding annuities over time are addressed in this article. Source: Wall Street Journal...