Too many American's will never be able to retire
The Annuity Man
Noah Smith's recent article in Bloomberg was a factual two by four to many retiree's foreheads.
Social Security was never designed to be the primary income source during retirement. Unfortunately, too many American's can only rely on this government backed income stream. In a perfect world, Social Security should be just a welcomed additional income payment coinciding with pensions and annuity contractual guarantees.
Annuities are the only product category on the planet that provides an income stream that you can never outlive. They are transfer of risk contractual guarantees with no ROI (Return on Investment) until you die because the annuity company is on the hook to pay as long as you are alive. In addition, you can structure the annuity contract so that 100% of any unused money will go to the listed beneficiaries on the policy. In other words, the annuity company doesn't keep a penny.
The annuity types that contractually guarantee a lifetime income stream are Single Premium Immediate Annuities (SPIAs), Deferred Income Annuities (DIAs), Qualified Longevity Annuity Contracts (QLACs), and Income Riders attached to Fixed Index Annuities (FIAs) and Variable Annuities (VAs).
Annuity lifetime income payouts are primarily based on your life expectancy ("life expectancies" if set up joint life) at the time you start the payments. Interest rates play a secondary role.
It's also important to point out that annuities are commodity products, and should be quoted with all carriers in order to find the highest contractual guarantee for your specific situation. Annuity quotes are like a gallon of milk and expire every 7 to 10 days, unless locked in during the application process.