If you cannot stomach the idea of riding the ups and downs of the financial markets in pursuit of long-term gain, annuities may be worth considering. Annuities are essentially investments that have an insurance component, but there are various types of annuities, each offering different features. For example, an annuity may offer a cost-of-living adjustment that can be used as a means to help protect your retirement savings against the impact of inflation over time.Take the temperature of health care costs: Longer life spans, skyrocketing medical costs and decreasing health care coverage by private employers make managing medical expenses a significant concern for retirees. New health care provisions set to go into effect in 2014 may reduce premiums somewhat, but if medical costs continue to trend higher, it is projected that half of retirees in 2030 could spend more than one-quarter of their income on medical bills and insurance premiums.* To help pay some of the services not covered by Medicare, you might consider purchasing supplemental health insurance and boosting the savings you have earmarked for medical expenses in retirement.
Potential Risks To Retirement
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