Retirement Income · Annuities
Have You Done the Math on How Long Your Savings Will Last?
Most folks I sit with have thought a lot about how much they have saved. Fewer have done the math on how long it will last.
That is the question that keeps people up at night. Not whether they saved enough, they probably did their best. But whether the structure of what they saved will hold up for 20 or 30 years of retirement.
An annuity is one of the few financial tools designed to turn a portion of your retirement savings into guaranteed income you cannot outlive, regardless of what markets do. It is not for everyone. But for a lot of folks, it is worth understanding.
Currently licensed in FL, AR, CA, DE, GA, LA, MI, NC, NE, OK, PA, SC, TX
Nexus Insurance Brokerage is an independent agency representing multiple insurance carriers. We work for you, not any single insurer, and are not affiliated with or endorsed by any carrier. Product availability varies by state.
The Problem
The Question Most Retirement Plans Don't Answer
A lot of folks put everything into one bucket. 401(k), IRA, all qualified money, all in the same place, all subject to the same tax treatment when they start withdrawing.
And then retirement hits. And two things happen that they didn't fully account for.
First, the withdrawals start, and every dollar they pull out gets taxed as ordinary income. They are drawing from a pool that is going to shrink faster than they expected.
Second, the market does what markets do. When you are 35, a down year is an inconvenience. When you are 68 and withdrawing, a down year means you are selling assets at the worst possible time.
That is the sequence-of-returns problem. And it is the reason a guaranteed income floor matters, something that pays no matter what the market does.
What an Annuity Actually Is
An annuity is a contract with an insurance company. You put in a lump sum, or a series of payments, and in return the company pays you income according to the terms of the contract. Different structures work differently, but the core idea is the same: you are trading a portion of your savings for income certainty.
Fixed Annuities
You receive a fixed interest rate for a defined period. Predictable. No market exposure. Best for folks who want a safe, stable place to put money they do not need immediate access to.
Fixed Indexed Annuities (FIA)
Your account can earn interest linked to a market index, like the S&P 500, but your principal is protected if the index goes negative. There is a cap on how much you can earn in an up year, and a floor: in a down year, you do not lose. Many FIAs include optional riders that convert your account into guaranteed lifetime income.
Income Riders
An optional feature on many annuities, sometimes called a Guaranteed Lifetime Withdrawal Benefit (GLWB). It creates a second value used specifically to calculate your income payments. That income can be turned on when you are ready and continues for as long as you live. Riders carry an annual fee and have their own terms.
Index-linked interest is subject to caps, participation rates, and/or spreads that limit credited interest. Dividends are excluded from index calculations. All guarantees are subject to the claims-paying ability of the issuing insurance company.
A Short Explainer
What a Guaranteed Income Floor Actually Looks Like
Victor walks through how an annuity fits into a broader retirement plan, in about two minutes.
The Bucket Approach
How This Fits in a Broader Plan
I never suggest putting everything into an annuity. That is not the right approach for anybody.
What I do is help folks look at their full picture, all the buckets, and figure out what role a guaranteed income floor could play.
Social Security is one source of guaranteed income. A pension, if you have one, is another. An annuity can be a third, filling in the gap between what Social Security covers and what your actual monthly expenses look like.
The goal is a retirement where the bills are covered no matter what happens to the market. The rest of your assets can stay in growth mode because you are not depending on them for everyday expenses.
Here is the part most folks do not expect. A lot of people who saved well spend their whole retirement afraid to touch any of it. When a baseline check arrives every month no matter what, you finally have permission to enjoy what you worked for, instead of watching the balance and bracing for the next down market.
It is worth taking a look at objectively. You might be surprised what the numbers look like.
How We Work
Your Full Picture
Income sources, assets, monthly expenses, timeline.
Find the Gap
What Social Security covers. What you need. What's unprotected.
See the Options
What a guaranteed income floor could look like for your situation.
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Products and carriers across the 13 states we are licensed in.
An Honest Read
If an annuity fits, we tell you which one and why. If it doesn't, we tell you that too.
Currently licensed in FL, AR, CA, DE, GA, LA, MI, NC, NE, OK, PA, SC, TX
Frequently Asked Questions
Can I lose money in an annuity?+
It depends on the type. Fixed and fixed indexed annuities protect your principal from market losses. You can, however, incur surrender charges if you withdraw more than the penalty-free amount during the surrender period.
Can I access my money if I need it?+
Most annuities allow a penalty-free withdrawal of 10% of the contract value per year. Beyond that, surrender charges may apply during the surrender period. Annuities are designed for money you are setting aside for income, not for liquidity.
How is the guaranteed income calculated?+
For income rider products, it is based on an Income Benefit Base that grows at a stated rate and is used solely to calculate your income payments. It is separate from your contract value and not available as a lump sum. We walk through the specific math for any product you are considering.
What happens to the annuity when I die?+
Most annuities include a death benefit. Depending on the product, your beneficiary may receive the remaining contract value, the income base, or a specified amount. Terms vary by product.
Is this right for IRA or 401(k) rollover money?+
Sometimes yes, but a rollover recommendation requires individual analysis of your full financial situation. We do not recommend rollovers generically. If a rollover makes sense for you, we document why.
Is my money safe if the insurance company runs into trouble?+
Honest answer: an annuity is not FDIC insured the way a bank account is. The guarantee rests on the issuing insurance company's claims-paying ability and financial strength, with a state guaranty association as a backstop if an insurer fails (coverage limits vary by state). That is exactly why we look at a carrier's financial-strength ratings before we ever recommend one. You should ask about them.
How do you get paid?+
The insurance carrier pays us, one time, when we place a policy. Never you. I will say it plainly: some annuities are a bad deal, and the ripoff is usually in the sales pitch, not the contract. So ask anyone, including me, how they are paid. A straight shooter answers without flinching.
Start With the Free 7-Question Checklist
Go through the seven questions to answer before you retire, and see where your plan has a gap, before we ever talk.
It's Worth Taking a Look, Objectively.
The goal is a retirement where the bills are covered no matter what the market does. You might be surprised what the numbers look like for your situation. No cost. No obligation.