Building Reliable Retirement Income with Annuities

Picture your first day of retirement, realizing that your last paycheck has already come and gone. Now, making sure you have a steady monthly income is up to you. Retirement planning has changed from what it was a generation ago. Back then, pensions, employer benefits and Social Security made things easier. Today, each person needs to take more responsibility.

This shift means you need to ask yourself: Are you ready to take charge of your retirement income? Use this simple checklist to find out:

1. Have you calculated your expected monthly expenses during retirement?
2. Do you have a plan for dealing with inflation affecting your cost of living?
3. Have you diversified your savings to withstand market volatility?
4. Are you familiar with tools like annuities to secure a steady income?

Knowing that your financial future depends on your own planning is the first step toward greater security.

The new retirement reality

People today are living longer, and, at the same time, many are retiring earlier than planned. That combination creates a simple reality: their money needs to last much longer. Without understanding the true cost of maintaining their lifestyle in retirement, many risk outliving their savings. That’s why proactive financial planning is essential.

Living longer and retiring earlier means facing additional financial pressures over time, including:

• More years of everyday spending.
• More exposure to market volatility.
• More potential health care costs.
• More pressure on personal savings to last.

Without proper planning, many retirees notice a bigger gap between their savings and the income they need. As people live longer, a steady income becomes even more important.

Why planning matters

When you think about your retirement income, you need to face some risks that most people would rather not think about:

• Will my savings last as long as I need them to?
• What happens if inflation increases my cost of living?
• How do I stay protected in market downturns?
• Will I be able to stay financially independent later in life?

Living longer can make these worries feel even bigger. Inflation slowly eats away at your buying power, and market ups and downs can hit your savings when you need them most. Taking control lets you manage these risks instead of leaving them to chance.

Why retirement income planning seems overwhelming

It’s no wonder many people feel unsure about planning for retirement. Most financial advice looks at your needs right now, not the fact that retirement could last 25 to 30 years or more. Important topics like health care, rising costs and long-term inflation often get left out, even though they really matter.

The real challenge is making a plan that gives you both stability and flexibility to cover all your needs.

Where annuities fit in

Annuities can help you create a steady income for retirement. They are made to give you stability when markets change and people live longer than expected.

Learn more: What is an Annuity?

Many retirees choose annuities because they offer:

• Steady, reliable income.
• Protection from outliving savings.
• Flexibility on when income begins.
• Predictability that traditional investments alone may not offer.

The main benefit of an annuity isn’t getting the highest return. It’s knowing your income will keep coming, no matter what happens in the market or how long you live.

A two-part retirement income approach

A helpful way to plan your retirement income is to split it into two parts:

1. Income for essentials. This part is related to financial stability, or the money you need each month to keep up your lifestyle. A Guaranteed Lifetime Withdrawal Benefit rider is designed for It can cover things like housing, groceries, utilities, insurance and basic health care.

Main advantages:

• Payments are guaranteed.
• Market declines don’t reduce the income.
• You know exactly what you can count on each month.

This is the base of your retirement income.

2. Income designed for growth. The second part is designed to help your income grow as your expenses change. With a GLWB rider focused on growth, you can increase your income over time.

It becomes increasingly important because:

• Health care costs often rise in later retirement.
• Inflation increases everyday living expenses.
• Your lifestyle needs may shift over time.

This potential growth can give you a “raise” during retirement. For example, if your income rises by 3% each year, a $2,000 monthly payment could become about $3,600 after 20 years. This growth helps you keep your buying power over time.

Why does combining the two work well?

By mixing steady income with income that can grow, you build a retirement plan that:

• Provides dependable income from the start.
• Helps keep up with inflation.
• Protects you from outliving your money.
• Gives you a smoother, more predictable financial path.

Each part has its own role, and together they help you feel more confident about retirement.

Common questions about annuities

Don’t annuities have high fees?

Annuities give you the certainty of guaranteed income and protection that market investments alone can’t offer. Not all annuities have high fees, and it helps to see the costs as an investment in your financial well-being, not as a penalty.

Is my money locked up in an annuity?

Annuities have surrender periods, but most let you withdraw money each year without a penalty and provide access in emergencies. You still have some flexibility. The key is to find the right balance.

Do I lose control of my money? No. With today’s annuities, you can take withdrawals, keep ownership and leave what’s left to your beneficiaries. They add structure, not limits.

Do annuities grow more slowly than the market?

Annuities are not meant to match the stock market. They are designed to reduce risk and provide a steady income. If you want both, indexed annuities can offer market-linked gains without risking your main investment. It’s about achieving the right balance, not choosing only one option.

If I die early, does the insurance company keep my money?

Not with today’s annuities. Many offer strong death benefits, so what’s left goes to your beneficiaries. Some riders even guarantee higher payouts.

Taking ownership of your retirement income

In the end, it comes down to this: Who is responsible for your retirement income?

If you believe the answer is you, then making a plan that combines security, flexibility and long-term protection can help you feel more confident during retirement, no matter how long it lasts. Learn more about annuity offerings from Ameritas.