Based on a recent article by RON LIEBER.
As slogans go, "Annuities: The official retirement vehicle of the Obama administration" is hardly “Keep Hope Alive,” or even “Change We Can Believe In.” But there were annuities, in a report from the administration’s Middle Class Task Force that came out this week. They are among the tools the administration is promoting as it tries to give Americans a better shot at a more secure retirement.
At its simplest -- which is how the White House seems to want to keep it -- an annuity is something you buy with a large pile of cash in exchange for a monthly check for the rest of your life.
If the biggest risk in retirement is running out of money, an annuity can help guarantee that you won’t. In effect, it allows you to buy the pension that your employer has probably stopped offering, and it can help pick up where Social Security leaves off.
“I never thought I’d have the president as a wholesaler for us,” said Christopher O. Blunt, executive vice president of retirement income security at the New York Life Insurance Company.
After all, the announcement from the White House did make it clear that the administration was looking to promote “annuities and other forms of guaranteed lifetime income.” That suggests the administration is open to other solutions, though there are not many others that are as simple as the basic fixed immediate annuity (also known as a single premium immediate annuity) that delivers a regular check for life.
As the saying goes, "any news is (usually) good news. And, as the volatility of the market produces more insecurity as to where retirement funds should be safely parked, annuities have emerged as the obvious safe harbor.
No matter what your political views, it is reassuring that Washington has taken this step toward financial responsibility.
