(New York)

What is the biggest challenge for retirement in the current era? The answer is time: people are living longer than ever, which means they need long periods of consistent income. Long term consistent income in retirement is a challenge because people need to set enough money aside and be disciplined to not withdraw too much. With all that in mind, annuities play a very special role, as they provide guaranteed income and at the same time, keep a lid on the pace of distributions, which means money will pay out throughout the entirety of retirement. Bonds used to play this role, but given ultra-low rates and high prices, they simply no longer do.

FINSUM: Given the volatility in stocks and the low rates and overvaluation in bonds, annuities have a very strong role to play in almost any portfolio.