Retirees Concerned with Running Out of Money
Advances in medicine have led to longer life expectancies, which may cause concern that you’ll outlive your savings. Even after years of careful saving, longevity is the biggest unknown when planning for retirement.
Longevity insurance mitigates risk for those who live longer lives. It’s not designed for your early retirement years nor is it intended to be a complete retirement plan. It’s meant to stretch your retirement resources and provide a hedge against living much longer than the average life expectancy. Smaller premiums are collected to fund an income stream that doesn’t begin until age 80 or 85, depending on how your policy is structured.
- Be realistic about your life expectancy. If you have a shorter life expectancy due to health issues, an annuity might not be right for you.
- If you purchase an annuity, it’s important to have other savings available to pay for emergencies or additional expenses that may arise.
- Add up your essential expenses in retirement and subtract any guaranteed sources of income. If there’s a gap, you may want to consider an annuity to cover it.
- A longevity annuity locks you into payments starting no later than age 85. There’s no flexibility to cash in the annuity if you change your mind.
Planning for Longevity
With the help of highly rated life and annuity carriers, the CBIZ Life Insurance Solutions team can help you determine if longevity insurance fits into your retirement plan and identify appropriate solutions to insure for longevity risk.