A term life insurance policy can offer retirees the peace of mind that comes with knowing their family will be taken care of if they pass away. However, some may look to their life insurance policy as a key investment tool.
In these cases, a fixed income annuity could be worth discussing with one's financial planner. The financial tools are contracts purchased with a life insurance company. They include a single premium that provides income in fixed payments as early as 13 months after their purchase. For retirees, they can mean a steady stream of income for the rest of their life, one of the few financial products that can assure that.
"Fixed income annuities can offer peace of mind because they provide consistent and reliable monthly 'paychecks' throughout retirement," said Beth Chang, an executive at one life insurer. "These products can play an important role in a broader investment portfolio, with fixed income annuities providing steady income and other investments such as mutual funds, ETFs or stocks capturing market upside and protecting against inflation risk."
Retirees are advised to do their homework on fixed annuities. Arranging one that's financially responsible could put them in a better position once they stop working.