New Video from TIAA-CREF Shows Investors How to Not Run Out of Money in Retirement
New York, November 17, 2010
TIAA-CREF, the leading provider of financial services for the academic, research, medical and nonprofit fields, today introduced “How to Not Run out of Money in Retirement,” a new animated video which explains how a low-cost annuity can ensure adequate lifetime income and address concerns about outliving one’s savings.
The video is the latest installment in a series of animated “how to” videos that aim to demystify saving and help more people get started or map out a financial plan.
View the series at: http://www.tiaa-cref.org/public/advice-planning/video/index.html
“In general, aim to replace the income you earned when you were working so that you'll always have enough money to cover basic needs,” said Jane Magpiong, TIAA-CREF’s head of wealth management. “Many retirement investors focus on accumulation, but fail to ensure they don’t outlive their savings. Automatically investing some of your savings in a low-cost annuity can help you guarantee income for life.”
The average monthly Social Security payment for retired workers as of September 2010 was $1,172, while the average monthly spending for individuals over age 65 exceeds $3,100.1
Ensuring Adequate Lifetime Income
Investors who want to learn how to not run out of money in retirement can do some financial planning now. As outlined in the video, here are five steps that can help.
- Know the goal. Ensuring adequate lifetime income is a primary reason you save for retirement. The goal of saving for retirement is not just to build wealth – it’s to replace the income you earned when you were working.
- Consider a fixed annuity. A fixed annuity guarantees you a specific amount of retirement income you can cover basic expenses when you stop working, and it won’t run out no matter how long you live.2
- Consider a variable annuity. If you want the potential for higher returns than a fixed annuity offers and are willing to assume some risk, consider a low-cost variable annuity. Payouts with variable annuities fluctuate because they’re tied to how the markets perform.
- Weigh the benefits. Consider contributing to an annuity while you’re still working, as opposed to purchasing one when you retire. A low-cost annuity can be a valuable part of a diversified retirement portfolio. It’s a guaranteed asset that can help minimize volatility and improve overall returns over time.
- Have a customized plan. Remember that one size doesn’t fit all when it comes to retirement strategies. Discuss your needs and goals with an objective financial advisor, and then create a customized plan that has the right mix of investments for you.
- Many annuities include the option to provide lifetime income to your beneficiary.
TIAA-CREF (www.tiaa-cref.org) is a national financial services organization with $434 billion in combined assets under management (as of 9/30/10) and provides retirement services to the academic, research, medical and cultural fields.
1 “Consumer Expenditure Survey, 2009.” U.S. Bureau of Labor Statistics. October 5, 2010.
“Monthly Statistical Snapshot.” Social Security Administration. September 2010 (released October 2010).
2 Guarantees are based on the claims-paying ability of the issuer.
TIAA-CREF products may be subject to market and other risk factors. See the applicable product literature, or visit www.tiaa-cref.org for details.
Guarantees are based on the claims-paying ability of the issuer.
You should consider the investment objectives, risks, charges and expenses carefully before investing. Please call 877-518-9161, or go to www.tiaa-cref.org for a current prospectus that contains this and other information. Please read the prospectus carefully before investing.
Annuity contracts and certificates are issued by Teachers Insurance and Annuity Association (TIAA) and College Retirement Equities Fund (CREF), New York, NY.
TIAA-CREF Individual & Institutional Services, LLC and Teachers Personal Investors Services, Inc., members FINRA, distribute securities products.