07/18/2024
The value of guaranteed income in retirement.
When you picture retirement, what comes to mind? Do you imagine visiting far-off destinations or spending more time with family and friends? Maybe you’ve always wanted to buy a cabin in the mountains, start a business or pursue a new hobby. However you wish to enjoy the next chapter, one thing is for certain: you’ll need income you can count on to retire your way. Including sources of guaranteed income in your retirement plan not only helps make your dreams for the future possible but can also give you the freedom to worry less and enjoy life more.
Less worry about retirement risks
Guaranteed retirement income can come from several sources, like Social Security, pensions and annuities, and can provide a “paycheck” that helps you cover basic living expenses, while also funding other goals like travel or renovating your home. A recent nationwide poll conducted by Athene in partnership with Kiplinger’s Personal Finance magazine revealed that 75 percent of Americans ages 50 and older want more guaranteed income than they already have or expect to have for retirement. With income they can count on, this group says they would be less stressed about running out of money, inflation, the ups and downs of the market and paying for health care as they age.
Unfortunately, many are concerned that Social Security benefits may be reduced at some point in the future and know they cannot count solely on this source of income to create a stable retirement. Even with employer-sponsored retirement savings plans, personal savings and IRAs, some retirees may still face income gaps that could restrict how they spend their time or the choices that they make. Including sources of guaranteed income in a retirement plan can provide funds you can count on for the rest of your life, no matter how the market performs or the cost of living fluctuates.
More freedom to choose
Most pre-retirees surveyed in the Athene-Kiplinger’s poll expect to retire later than the current average age of 61. With less confidence in the economy and the financial strength of Social Security and Medicare, pre-retirees believe they will need to work longer than previous generations to cover the rising costs of health care and counteract the effect a recession and other economic and political issues could have on their retirement savings. By building sources of guaranteed income into your retirement plan, you can help bridge savings gaps and make working in retirement a choice, rather than a necessity. Even with a potentially lengthy retirement ahead of you, a steady income flow can help you feel more confident in your financial future and your ability to seize any opportunities that lie on the horizon.
Confidence about the future
With life being anything but predictable, creating a diversified plan for retirement can be one of the best defenses against the twists and turns of the road ahead. In particular, among pre-retirees in the poll who have an annuity as part of their retirement income strategy, 74 percent feel confident they will have enough income to live comfortably in retirement, and 68 percent believe they won’t run out of money or outlive their savings. What’s more, among the respondents who are already retired, those with annuity income say they are more satisfied with their lives than those without an annuity, and they’re able to spend their time doing the things they enjoy. Plus, they have enough money to cover essentials, while also being able to splurge on the things they want.
Among pre-retirees with an annuity:
74% feel confident they'll have enough income to live comfortably when retired
68% believe they won't run out of money or outlive their savings
How you define living your best life in retirement may be different from the next person, but it’s likely financial certainty and stability are important components to making those dreams a reality. As you build your retirement income plan, talk with your financial professional about the ways having more guaranteed income could benefit you. Don't have a financial professional? We can help. There’s no better time than now to find out how you can feel more confident about your journey ahead.
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