How to Guarantee Income with an Immediate Annuity: A Case Study

Margaret, a 67 year old retired, single female, was worried about the income she was receiving during her retirement years. She was drawing $600 a month in Social Security income, $200 a month in pension and has $150,000 earning 3.2% interest in a certificate of deposit. Presently, $800 a month was enough to sustain Margaret’s lifestyle but she was concerned about the future. With inflation, the way unexpected expenses pop up and the low interest rate on her certificate of deposit, Margaret wondered if she would have enough income for the rest of her life.

A smart move for Margaret would be to consider moving a portion of her $150,000 into an immediate annuity when her CD matures. An immediate annuity would allow her to receive monthly income for the rest of her life without having to worry about interest rate fluctuations. She would also be receiving more income on her deposit, because annuity interest rates are typically higher than CD interest rates and the payout is based on her life expectancy.

After weighing her options and speaking with an Annuity Specialist, Margaret moved $100,000 of her matured CD funds into an immediate annuity with a lifetime payout and 10 years period certain. The addition of the period certain option guarantees that she will be paid for at least 10 years, even if she dies prematurely. Her beneficiary would receive the remainder of her annuity payments. Her estimated monthly payments are $636 – boosting her monthly income to $1436. Margaret’s income worries are put to rest; this amount even lets her set aside a small amount of money each month in case of emergencies.

To consult with FixedAnnuityDirect.com’s Annuity Specialists and see if an immediate annuity is right for you, call 1-877-519-8599. Or you can fill out FixedAnnuityDirect’s Web form located at http://www.fixedannuitydirect.com/inquiry.htm to receive a free comparison report of all the best immediate annuity rates in the country.