Annuities
Is an annuity right for you?
A straight answer, because the honest version is more useful than the sales version.
An annuity probably earns its place if…
1. You need more guaranteed income
Your pension and Social Security cover your fixed expenses, but there’s a gap — and covering that gap with guaranteed dollars lets you invest the rest more freely.
2. You’re genuinely loss-averse
You know yourself. If a 25% drawdown would make you sell at the bottom, a floor is worth more to you than upside.
3. Longevity runs in your family
A lifetime income guarantee is most valuable to people who may live well past 90.
4. You’ve maxed the alternatives
401(k), IRA, Roth, HSA, emergency fund — all funded. An annuity becomes a reasonable next bucket.
An annuity probably doesn’t fit if…
1. You might need the money soon
Surrender charges and the 59½ penalty make early withdrawals expensive. If liquidity matters, this isn’t the tool.
2. You need growth, not protection
A long horizon with guaranteed income already in place usually favors investing, not capping your upside.
3. You’d be paying for a guarantee you don’t need
If your pension already covers your essential expenses, you may be buying insurance against a risk you’ve already solved.
The three questions I ask first
- What expenses absolutely have to be covered, no matter what the market does?
- How much guaranteed income do you already have — pension, Social Security?
- What would you do with the money if we didn’t use an annuity?
If the answers point away from an annuity, I’ll tell you. I’d rather lose a sale than sell you something you regret — that’s a longer-term business model.
Let’s find out together
Bring your situation and we’ll work through the checklist honestly.