Archive | Annuities


Two schools of retirement income thought

You may not be aware of it, or in which you fall, but there are generally two retirement income schools of thought. One school of thought is the “safety first” school and the other is the “probability based” school of thought. Neither is right or wrong, it essentially comes down to each retiree’s decision. Safety First […]

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too big to fail

Too big to fail? Getting the thoughts going …

Here is a guest post by Dr Wade Pfau on his blog (his bio on his blog page) of a segment of a longer email conversation he and I had about the possibility the big push to “solve” the retirement issues exposed by the Great Recession may be a setup for insurance companies to become too big […]

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Uh, Sorry…Can We Have That Back?

The deeper I got into research on sustaining retirement income the more I wondered how an insurance company could offer and sustain their promised income benefits? The answer it seems is that they can’t. This article by Alan Levine in Wealth Management titled Uh, Sorry…Can We Have That Back? | Insurance content from explains what […]

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How does an Annuity compare to Total Return Retirement Income?

The promise from an insurance company … lifelong income you can’t outlive. This is true. But … what is an alternative? Total Return is an alternative. Money does not know whether is comes from dividends, interest or gains. Since the mid-1990’s peer-reviewed research has been done by academics and practitioners (I am one of those practitioners) about distributing […]

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Latest research into sustainable retirement distributions

A structural problem with pensions, annuities, and first generation “safe withdrawal rate” methodology, is a disconnect of benefits paid (fixed or fixed with COLAs) from the underlying asset values required to support those promised benefits. Underlying asset values supporting retirement in any scheme are variable and may decrease in value, temporarily or permanently, due to market […]

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monthly payments

Take the Pension? Or the lump sum offer?

Pensions, for most people, are rare these days. Sometimes pension plans offer a lump sum to covered employees in lieu of a monthly payment. There are pros and cons when you need to decide the choices that are offered. There are risks either way. As with anything involving risk, diversification is the prudent path to take. […]

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Variable Annuity

Variable annuities: Buyer beware

Many people are skittish about stock markets these days. They seek stock market returns without stock market risk. Insurance companies appear to offer this cake and ability to eat it too through Variable Annuity products. What about those guarantees from insurance companies that come with Variable Annuities? Variable annuities have a “real” account value and also […]

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