Decision To Defer or Not
The option to defer purchase of an annuity (income drawdown) has the benefit of investment flexibility, offset by the risk of falling annuity rates as the life expectancy of the surviving individual rises (mortality drag). Interest rates and inflation can affect the decision to purchase, as they are reflected in the annuity rates, and also affect secure investment potential by varying bond yields. Inflation deteriorates the buying power of an annuity and can therefore be a concern.
Read more about this topic: Life Annuity
Famous quotes containing the word decision:
“The issue is privacy. Why is the decision by a woman to sleep with a man she has just met in a bar a private one, and the decision to sleep with the same man for $100 subject to criminal penalties?”
—Anna Quindlen (b. 1952)