Loren was a client we had assisted with Medicare education and plan selection for her imminent retirement. So, when she learned that we also guide her with retirement income planning, she followed up our Medicare meeting with a call for information on protecting her and her husband's retirement money.
When we met again, we discussed the couple's goals and desires in retirement and how they were currently saving. As we discussed protection strategies and options, Loren quickly cautioned me not to bring up annuities as an option. "I don't want any annuities! I've heard bad things about them and want to stay away from those types of products!" When we asked what "she had heard," she provided vague answers and a lot of general outdated information. So, it was essential to explain annuities first. "Annuities are just a tool in the toolbox, and while you certainly don't want to put all your retirement cash into annuities, it makes good planning to have some of your money totally protected from market fluctuations."
What She Learned Changed Everything
After we educated her on all the types of annuities available and other types of investment opportunities, she was somewhat surprised that much of the information friends gave her was grossly inaccurate. She was also shocked at how misleading some of the advertising she got in the mail from well-known companies was. Some information we clarified her understanding on:
1) She can change her mind on her annuities. 2) She can pick the duration of her selections. 3) Her accounts can be "controlled from the grave" if she has an errant adult child tempted to blow all the inheritance money.
Other types of annuities would protect them with Long-Term Care solutions for her and her husband. "I didn't understand annuities and had no idea there were so many options with them," she exclaimed.
The point is that there are many types of investments to protect your nest egg; first, you need to understand how each type could work with your goals. Everyone's goals are different. Your goal should be a well-rounded retirement plan that fits your needs and retirement wishes. There is no one-size-fits-all planning solution. Our aim at American Retirement Advisors is education before you make decisions and helping you create a personalized plan that fits your retirement goals.
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By American Retirement Advisors
American Retirement Advisors helps retirees and pre-retirees navigate Medicare, estate planning, and retirement income — so you can enjoy the retirement you've earned.
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Easy Eddie's Take
Loren's story is something I hear all the time. Most people are surprised when they learn that there are actually several different types of annuities, each designed for different retirement goals. When folks ask me "Are annuities good or bad for retirement income?" I explain that it's like asking if tools are good or bad - it depends on what job you're trying to do.
Here's what's worth knowing in 2026: immediate annuities can provide guaranteed monthly income right away, while deferred annuities let your money grow tax-deferred until you need it later. Fixed indexed annuities protect your principal while giving you a chance to earn returns tied to market indexes like the S&P 500. And hybrid annuities with long-term care riders can help cover nursing home costs that Medicare doesn't handle, which is especially valuable since the average cost of a private room in Arizona runs about $7,500 per month.
The key is getting clear, honest information about how different retirement income strategies - whether that's annuities, 401k distributions, Roth IRA conversions, or Social Security optimization - fit together for your specific situation. Once you see how it all works together, planning becomes much clearer.