What annuities can (and can’t) do for retirees
January 18, 2016 by Michael Finke
A 65-year old American male has a 10 percent chance of living to the age of 96. Let’s say he wants to fund $100,000 of spending during his 96th year of life. Since he values spending certainty, he’ll put the money in a diversified portfolio of long duration bonds.
Assuming today’s long-term 4 percent rate on 30-year corporate bonds and a 1 percent advisor fee, he’ll have to set aside $41,200 today to cover the desired $100,000 in spending at age 96.
Originally Posted at LIfeHealthPro on November 4, 2015 by Michael Finke.
Categories: Industry Articles
