Improved longevity can put stress on retirement savings to provide income for more than 25-30 years. Over these long investment horizons, unprotected retirement income frameworks may not adequately meet the needs of investors. It can be hard for investors to stomach the idea that a retirement plan may need to be revised because, due to a 20% market drop, their anticipated $45k/yr. income looks more like $34k, for instance.
In this white paper, American College of Financial Services Professor Michael Finke, PhD, explores a new kind of solution called a Contingent Deferred Annuity (“CDA”) that efficiently provides portfolio income insurance by establishing a fixed guaranteed stream of income for life.