CONTACT US
Enter your Name, Email Address and a short message. We'll respond to you as soon as possible.
1021223-00006-00
Nate Obringer, RICP®
Financial Advisor
Prudential Advisors
9800B McKnight Road, Suite 223
Pittsburgh, PA 15237
Phone: 412-318-4129
Fax: 877-840-2322
Email: nate.obringer@prudential.com
September/October 2021
Ladder Annuities for Steady Income
Are you seeking an investment that provides guaranteed income in retirement? You might want to consider an immediate annuity.* With an immediate annuity, you receive fixed payouts over a set number of years in exchange for an initial lump-sum payment.
Investing a large portion of your retirement savings in an annuity when interest rates are low may not seem like a smart move. However, you may be able to minimize the risk of low returns and take advantage of any rise in interest rates that occurs by laddering annuities.
The Laddering Strategy
The laddering strategy involves purchasing immediate annuities over a number of years. So, instead of spending your money on a single annuity that locks you into a lifetime interest rate, you invest in multiple annuities over time. You might buy one annuity a year for four years or an annuity every three years for 12 years, etc.You can also ladder annuities based on the start dates of when you’ll begin receiving the payments.
Laddering Benefits
Annuity payouts are based on the amount of money invested, the prevailing interest rate and the recipient’s life expectancy. So, the older you are when you begin receiving payments, the larger those payments will likely to be. And, if interest rates are higher in later years, you could benefit from having used a laddering strategy.The Downsides
Investing a large sum in immediate annuities means you’ll no longer have access to those funds. That’s because early surrender of an annuity can trigger various fees that can be costly. So, if you have an unanticipated expense in the future and need cash, be sure to have an emergency fund so you do not have to tap your annuity.It’s also important to understand that unless the annuity is a joint lifetime annuity or includes a survivor payout, annuity payments stop at the owner’s death.
Food for Thought
If the security of having a guaranteed income appeals to you, review laddering strategies with your financial professional.*Immediate fixed annuity contracts, annuitants receive a fixed income stream based, in part, on the interest rate guarantee at the time of purchase. Annuity guarantees are backed solely by the claims-paying ability of the issuing life insurance company.
1048402-00001-00
Offering investment advisory services and programs through Pruco Securities, LLC (Pruco), under the marketing name Prudential Financial Planning Services (PFPS), pursuant to a separate client agreement. Offering insurance and securities products and services as a registered representative of Pruco, and an agent of issuing insurance companies. 1-800-778-2255. Prudential and its representatives do not give tax or legal advice. Please consult with your own advisors regarding your particular situation. Prudential, the Prudential logo, and the Rock Symbol are service marks of Prudential Financial Inc., and its related entities, registered in many jurisdictions worldwide. Prudential Advisors is a brand name of The Prudential Insurance Company of America and its subsidiaries.
This newsletter is general educational information provided by a Prudential Financial Professional and is not intended to market or sell any specific products and services, but rather provide general information about the subject matter covered only.
Prudential Advisors and LTM Marketing Specialists LLC are unrelated companies. This publication was prepared for the publication’s provider by LTM Client Marketing, an unrelated third party. Articles are not written or produced by the named representative.
The information and opinions contained in this web site are obtained from sources believed to be reliable, but their accuracy cannot be guaranteed. The publishers assume no responsibility for errors and omissions or for any damages resulting from the use of the published information. This web site is published with the understanding that it does not render legal, accounting, financial, or other professional advice. Whole or partial reproduction of this web site is forbidden without the written permission of the publisher.