| Linda and her husband saved diligently for retirement. He passed away, leaving her with a $500,000 IRA that was intended to support her for the rest of her life. Though her overall health was good, her arthritis was getting worse. She basically had a choice every day: do the cooking and cleaning, run errands, or do the things she enjoyed—she didn’t have the energy and mobility to do all three.She has looked into retirement communities in her area. She wants to stay near friends and family so that she can fully participate in their lives and activities, just as she has always done. But she wants her independence, too.
She found a beautiful place.
- A little townhouse just the right size for her.
- No yard to keep up, utilities to pay, or maintenance to do on the building.
- Spacious enough to feel like a home, but small enough that it’s not overwhelming.
- And better yet—no housework!
- Plus, just a short walk away, access to recreational activities, clubs and classes.
- And a restaurant with a master chef where she could eat free every day.1
Wait…what? Eat world-class cuisine, free every day?
Absolutely! Or she could stop by the local sandwich shop if she wanted something lighter. Or order in. Or cook one of her favorites when she felt like it.
She felt like a queen as she toured, and could fully see herself living there. But she still wasn’t convinced. It seemed too expensive.
Then Linda talked to her daughter, who helped her add up the costs of living in her old home—some monetary, and some emotional and physical.
- Utilities (electricity, gas, water, trash pickup, sewer).
- Maintenance on the structure.
- Landscaping.
- Appliance repair and replacement.
- Cable and phone service.
- Transportation to every place she wants to go (shopping, visits, appointments, social activities),and the upkeep on her car.
- Groceries for every meal (and the hassle of shopping for and preparing them).
- The feeling of isolation and loneliness.
- Concern about falling or other injury without anyone around to help.
- The stress of trying to do things alone that her body just does not allow, like moving heavy objects, reaching to clean high windows, climbing ladders, etc.
- The feeling of being a burden as she has to ask others to help her.
- The effect these stresses have on further eroding her health, and the extra medical costs that they can create. (Not to mention the lower quality of life.)
Suddenly the new place was looking more attractive!
But there is yet another concern. She doesn’t want to spend a few years living like she envisions, only to end up with a much lower standard of living because she has run short of money.
Will her money hold out?
If Linda talks to us, we can help her be sure that it will!
We can help her select an annuity suitable to her needs, which will function something like a “personal pension” that will pay her an annual stream of income from her money every year.
The insurance company that holds her annuity contract will invest her money.
- They take all the risk and guarantee* her that she will never lose her principal.
- If their investments don’t do well, Linda loses nothing. If their investments earn, Linda gets part of the profit.
- That money goes to her principal, so her protected money increases, which means that her monthly income is guaranteed*
But there’s another benefit Linda could enjoy because
of her restricted physical abilities.
You read that right. Not in spite of her restrictions, but because of them.
For people who have some trouble with daily activities such as bathing, dressing, walking, and getting in and out of chairs (and others), there are riders** available for some annuities that can as much as DOUBLE the income.**
Let’s say Linda puts $300,000 of her IRA into this plan. This is what she could earn. Figures show payouts for each year, depending on when she turns on the income stream. |
