• Question
  • When to annuitize?

    Asked by a 64 year old woman from Cedar Park, TX on 9/9/2011

    I am 62 and still working at this time. My financial advisor is recommending that I start to annuitize my annuity account. His thoughts are that I can start to use the monies now to supplement my monthly income. He says that if I wait much longer I may not use all the monies myself if I should die earlier than expected. I know that there is a tax benefit in taking a monthly annuity rather than yearly lump sums and that the taxable amount would be only on the earnings. My income is low. Also, is there an advantage for my financial advisor if I should begin taking these monies? He is strongly urging me to do this now. Thanks

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  • Categories: How to Choose, Annuities

Answers

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  • 55 year old from Rochester, NY

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  • Hi Wannabe,

    A few thoughts:
    1) You may want to get a second opinion from a Fee Only financial advisor about whether annuitizing now is a good idea or not. A fee only certified financial advisor only gets paid by you and doesn't have any conflicts of interest.

    2) You should ask your current advisor if they will make any extra money if you start to annuitize now (or if they have any other interests besides yours in this decision).

    3) You may want to try our NewRetirement Calculator to see what it comes up with in terms of your cash flow needs, which can inform your decision about whether to start your annuity payments.

    Good luck!

  • Login to rate this answer:   Answered on 9/13/2011
**All above answers are provided as general information only. No warranty is made regarding the fitness or accuracy of the information provided in this answer. You should seek advice from a licensed CPA, attorney or CERTIFIED FINANCIAL PLANNER™ as to your unique financial situation.