Annuities in Retirement Planning: Pros, Cons, and Considerations

Vanguard's new 401(k) fund will enable converting savings into a fixed annuity, reflecting a surge in annuity popularity. Annuities offer guaranteed lifetime income and tax advantages, but they are also complex and costly. This article explores whether annuities are a smart retirement move, delving into their various types, benefits, and potential drawbacks, such as fees and inflation risks. It concludes by offering guidance on evaluating an annuity's suitability based on individual health, risk tolerance, and existing income sources, emphasizing the importance of professional financial advice.