In the Market Watch article “On days like this, annuities look better than ever,” Andrea Coombes tells us why more people compare annuities to other investment vehicles as the stock market falls. It’s hard to argue with guaranteed income payments for life when you see a day on Wall Street with the market dropping 1,000 points. Many people are watching their retirement income statements play out like a game of roulette and frankly, it’s scary. With a large selloff yesterday, the Dow Jones Industrial Average dropped 1,000 points in the afternoon hours. It was able to recover somewhat and close down 348 points, but still down. If all or most of your retirement money is in the market waiting to grow, days like this are surely worrisome.
For those who advocate annuity products, these declines help them even more in their cause. While there are people who still don’t think annuities are best for your retirement, it is difficult to pass on guaranteed income with such a fluctuating market as we’ve seen lately. Immediate annuities can be purchased using a portion of your retirement income and can cover your basic expenses in retirement. The money will continue to come in monthly as long as you live, providing you purchase from a sound insurance company. This is why President Obama’s administration is researching the idea of making the option of annuities mandatory in retirement plans.