Does an annuity make sense for your retirement income strategy? As you near retirement, you probably see ads and sales pitches for these products, but they're extremely complicated. This video breaks down the essential features, starting with the cleanest, simplest form of retirement annuity: the immediate annuity.

From there, we'll go over features of several other types of annuities, including aspects that are common to almost all other annuities out there. We'll touch on taxation, surrender charges, and the pros and cons of annuities in retirement. You'll learn about fixed, variable, and index annuities, as well as lifetime income payout options. You can receive payments for a single life, a joint life, or a period certain (with or without a lifetime income attached).

For many, there's a concern about losing money with an annuity if you die shortly after starting one. That's a valid concern, and there are several ways to mitigate that risk—including choosing not to use an annuity.

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Justin Pritchard, CFP® is a fee-only financial advisor with 15 years of experience working with clients. He is based in Colorado and can with clients throughout the U.S.


Approach Financial, Inc. is registered as an investment adviser in the state of Colorado and is licensed to do business in any state where registered or otherwise exempt from registration. The information here may contain errors and omissions, may be outdated, or may not be applicable to your situation. You may lose money investing. Consult with a professional before deciding anything. Thank you!