Inflation Risk

The risk of a decrease in future purchasing power due to rising prices. Inflation risk can impact fixed annuities that do not contain inflation protection because it erodes the future power of a stream of fixed payments. For example, a relatively modest 3% rate of inflation will reduce the purchasing power of a $3,000 monthly payment to $1,660 within 20 years.

Am I better off just buying a CD for $100,000 than an annuity? Is FDIC insurance important? Aren't there less fees too?

It really depends on what your overall financial needs are.  It is true that a certificate of deposit or CD is insured and less costly than an

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How do annuities protect against inflation?

This is a super important question and consideration--particularly given the financial crisis and our current economic environment.  There are some comments on this topic throughout the site including this blog post.

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What are some rules of thumb for fixed income ppl choosing between bonds and annuities with their lump sum retirement payouts?

This is a great question but it is difficult to answer briefly. 

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What type of risk is associated with annuities?

There are a number of risks associated with annuities, and these risks often depend on the type of

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