Annuities for retirement income
May 27, 2016 by ED MCCARTHY, CFP, RICP
Annuities are valued for their tax-deferred accumulation benefit, but they also provide an essential source of retirement income for many retirees.
Matt Drinkwater, assistant vice president, LIMRA Secure Retirement Institute in Windsor, Connecticut, reports the institute has conducted an ongoing study of variable annuity owners who purchased contracts in 2007. In 2013, 88 percent of owners above age 70 took guaranteed withdrawals from their annuities. That percentage drops off for those in their 50s and 60s, which is expected, but nonetheless, he points to the 88 percent as an impressive result that demonstrates the income benefit’s value to owners.
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