Fixed Annuity vs Fixed Indexed Annuity vs Income Annuity

How long does retirement money actually need to last?

Most people underestimate this number. If you retire at 65, your money may need to last 25 to 30 years — or longer. A married couple where both spouses are 65 today has roughly a one-in-two chance that at least one of them will live to age 90.

This is why simply "saving enough" is only half the challenge. The other half is making sure that money is structured so it can actually last — through market downturns, health surprises, and the rising cost of everyday life.

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What is the difference between safe money and growth money?

One of the most useful ways to think about retirement savings is to divide it into two groups: money that cannot go down in value, and money that can grow — but can also shrink.

Neither approach alone is usually right. Most people in retirement do best with a blend — enough safe income to cover the essentials, and some growth-oriented assets for the longer term.

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How much should I keep safe versus invested?

There is no single right answer, but a useful starting point is to look at your essential monthly expenses and ask: are those covered by income that cannot run out?

Essential expenses are things like:

• Housing (rent or mortgage payments)
• Food and utilities
• Health insurance and Medicare costs
• Basic transportation

If your Social Security and any pension income already cover those essentials, you may be in better shape than you think. If there's a gap — for example, your essentials cost $4,000 a month but your guaranteed income is only $2,800 — that gap is worth addressing before the rest of your plan is built.

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What options give me guaranteed income I can count on?

Beyond Social Security, there are financial tools designed specifically to pay you a set amount for the rest of your life — no matter how long you live, and no matter what happens in the stock market.

Here is a plain-language overview of the main options:

• Defined-benefit pensions — If you or your spouse worked for a company or government that still offers one, this is the gold standard. A set check every month for life.
• Income annuities — A contract where you give a portion of your savings to an insurance company, and in exchange they pay you a guaranteed income for life, subject to claims-paying ability. There are several types, and they are not all the same.
• U.S. Treasury bonds and FDIC-insured accounts — Not a lifetime income stream, but a stable, predictable store of value that can be structured to generate income for a defined period.
• Delaying Social Security — For every year you delay claiming past age 62 (up to age 70), your monthly benefit grows. This is one of the most cost-effective ways to lock in more guaranteed income for life.

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What about inflation eating away at my savings?

Inflation is the quiet risk most retirement plans underestimate. Something that costs $1,000 today could cost $1,800 or more in 20 years, even at modest inflation rates.

Here is why this matters so much for retirees specifically:

• Healthcare costs tend to rise faster than general inflation
• A fixed income that felt comfortable at 65 can feel tight at 80
• If all your income is fixed, you lose purchasing power every year

The practical response to inflation in retirement usually involves two things: keeping some money in growth-oriented assets that can outpace inflation over time, and choosing income products thoughtfully with an eye toward how they handle rising prices.

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How does Social Security fit into all of this?

Social Security is the foundation of most people's retirement income — and most people do not get as much from it as they could.

A few facts worth knowing:

• You can claim as early as 62, but your monthly benefit will be permanently reduced
• Waiting until your full retirement age (66 or 67 for most people today) restores your full benefit
• Waiting until age 70 increases your benefit by roughly 24–32% above full retirement age — for life
• Married couples have additional strategies around spousal and survivor benefits that can meaningfully raise lifetime income

The "right" time to claim depends on your health, your other income sources, and whether you are married. It is one of the most important and irreversible decisions in a retirement plan, so it deserves careful thought — not a guess.

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What mistakes do people most often make in early retirement?

After working with retirees for many years, I see a few patterns that come up again and again. None of these are failures of intelligence — they are usually failures of information.

• Claiming Social Security too early — Claiming at 62 instead of waiting can cost tens of thousands of dollars in lifetime income, especially for the higher-earning spouse.
• Withdrawing too much too soon — Taking large withdrawals from savings in the first few years of retirement — especially during a market downturn — can permanently shrink how long those savings last.
• Ignoring healthcare costs — Medicare does not cover everything. Long-term care, dental, vision, and supplemental coverage can add up fast if not planned for.
• No plan for the surviving spouse — When one spouse passes away, income often drops (sometimes sharply) while expenses do not. This gap catches many families off guard.
• Treating retirement as a single event — Retirement income planning is not something you do once and file away. Life changes. Your plan should be reviewed regularly.

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What questions should I be asking a retirement advisor?

If you sit down with someone who does retirement income planning, here are the questions worth raising — regardless of how much money you have.

1. Do I have an income gap, and if so, how large is it?
2. What is the most tax-efficient order to draw down my accounts?
3. When is the right time for me to claim Social Security — and should my spouse claim at a different time?
4. What happens to my spouse's income if I die first?
5. Am I taking on more risk than I need to — or less growth than I need?
6. How does my plan hold up if we have a major bear market in the first five years of retirement?
7. What is my plan for long-term care costs?

A good retirement income review will not pressure you into any product. It will help you see your full picture clearly, so you can make decisions with confidence.

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Quick answers to common questions