SOURCE: AnnuityAdvantage


July 19, 2017 10:55 ET

Creating Your Own Pension

AnnuityAdvantage CEO says time-tested method recommended by economists is underused; A lifetime income annuity lets you create a custom pension

MEDFORD, OR--(Marketwired - July 19, 2017) - Few people have enough income from Social Security and company pensions to fully support their retirement. They need a way to get additional guaranteed lifetime income, according to a recent article in ThirdAge.

"By buying a lifetime income annuity, you can create your own custom pension," writes Ken Nuss, CEO of AnnuityAdvantage, an online annuity marketplace. "With a single-premium immediate annuity -- another name for it -- you can convert your savings into a monthly income that's guaranteed for life."

Economists agree that annuitizing a significant portion of your retirement savings is the way to go, according to a study from Wharton Financial Institutions Center, Nuss writes.

Life insurance insures against the risk of a breadwinner dying prematurely. A lifetime annuity does the opposite, insuring against the risk of living longer than expected, he writes.

With lifetime annuities, the 50 percent of people who die earlier than average subsidize the half who live longer than average. That risk-pooling is what makes life annuities so valuable, Nuss writes.

You can self-insure against longevity risk, but you'll need to save 25 percent to 40 percent more than with an annuity because you won't have the advantage of risk-pooling, the Wharton Financial Institutions Center study concluded.

How far will your money go?

Here's one typical scenario: a 65-year-old man can create a $1,093.54 monthly income that's guaranteed for life by depositing $200,000 in an immediate annuity from a highly rated insurance company. If the buyer lives an average lifespan, to age 85, he will collect $262,449 in benefits.

But the longevity insurance really starts to kick in after 85, Nuss writes. A man who lives to 90 will get $328,062 in total. A 95-year-old will have collected $393,674.

"Since you're counting on an insurance company to keep its promise of providing lifetime income, be sure to choose a financially strong insurer," Nuss writes.

Nuss's article can be read at

ThirdAge is a website promoting healthy living for women and their families.

Based in Medford, Oregon, AnnuityAdvantage is a leading online provider of fixed-rate, fixed-indexed and immediate income annuities. Its team sorts through the array of annuity options to provide each client with product offerings custom tailored to their specific situation. Every annuity offered is filtered, screened and analyzed for client suitability.

More information is available at 800-239-0356 or Twitter: @AnnuityAdvantag. Facebook:

#annuities #personalfinance

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