An Annuity Calculator Might Reveal Better Retirement Options
When it comes to annuities, there tend to be two sides: those that love annuities and incorporate them into their retirement portfolio, and those that think they are a bad investment. As with any financial decision, it is important to get all of the information you need to make an educated decision on whether or not to include annuities in your retirement portfolio. An annuity calculator can be a great tool to see how annuities can boost your retirement savings.
How Annuities Affect a Retirement Portfolio
Many people who oppose investing in annuities do so because they feel that they have better opportunities to invest elsewhere. However, annuities should not be completely discounted as they can be a powerful addition to your retirement portfolio. If you are concerned about outliving your retirement savings or losing your standard of living in retirement, annuities can help reduce this risk and add a certain level of financial security as they provide lifetime monthly income.
Even with the financial security that guaranteed income for life can provide, people are still wary of investing in annuities. According to research from consulting firm, Towers Watson, 80% of survey participants would choose a lump sum benefit from their employer when retiring over an annuity. To decide whether or not an annuity is right for you, you’ll want to consider the likelihood that you will outlive your retirement savings, how much guaranteed income you have from other investments, and your level of financial risk.
Utilize an Annuity Calculator
Using an annuity calculator is a great way to see just how investing in annuities can affect your overall retirement portfolio. By putting some basic information into the calculator, you can determine how much lifetime income your investment can buy. If you know how much monthly income you would like to get from an annuity in retirement, the calculator will also help you determine how much you will need to invest upfront.
Though the annuity calculator is just an estimation, it will give you a better idea of how investing in a lifetime annuity can help boost your retirement portfolio. By looking at the annuity calculator results, along with how much retirement income you will be receiving from other sources and your estimated monthly expenses, you can get a big picture idea of whether or not an annuity is right for you.
Depending on who you have talked to, you might have heard some unfavorable things about investing in annuities. Ultimately, the right choice depends on your retirement portfolio and your personal needs and circumstances as you approach retirement. Using an annuity calculator helps you make a more informed decision about investing in a lifetime annuity.