{"id":283052,"date":"2026-01-14T01:57:13","date_gmt":"2026-01-14T01:57:13","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/283052\/"},"modified":"2026-01-14T01:57:13","modified_gmt":"2026-01-14T01:57:13","slug":"5-obscure-retirement-terms-you-should-know","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/283052\/","title":{"rendered":"5 Obscure Retirement Terms You Should Know"},"content":{"rendered":"

An income annuity<\/a> is a way to turn part of your nest egg into a steady flow of cash, typically for the rest of your life. \u201cYou give an insurance company a lump sum, and\ufeff in return, it promises to send you regular payments for as long as you live,\u201d says Birardi. He describes it as \u201cinsurance against outliving your money<\/a>,\u201d because the payments keep coming no matter how long you live.<\/p>\n

\ufeffA common type of income annuity is a single-premium immediate annuity (SPIA), which provides payouts typically within 30 days. For many retirees, that guaranteed payment can be reassuring. Instead of frequently wondering whether your portfolio will last, you know at least one stream of income is locked in. That appeal might explain why annuity sales reached a record $121.2 billion in the third quarter of 2025, according to a survey<\/a> by the Life Insurance Marketing and Research Association (LIMRA), a trade group for the financial services industry.\ufeff\ufeff<\/p>\n

However, there are trade-offs. If you purchase an immediate annuity when interest rates are low, you lock in lower payouts for life. Because the payments are fixed, inflation<\/a> can erode their value over time \u2014 although some plans allow you to purchase a cost-of-living rider (often called a COLA rider), where your annuity payments increase annually to help offset the effects of inflation. \ufeff<\/p>\n

In addition, once you\u2019ve handed over the lump sum to an insurance company, you typically can\u2019t get it back if, for example, you have an expensive emergency. Keeping your money in a retirement account like a 401(k)<\/a> or IRA provides more flexibility \u2014 you can change your investments, or take out more or less as needed.<\/p>\n

The key factor when determining whether an income annuity is right for you is how much you value guaranteed income versus control of your nest egg. For some people, putting a slice of their savings into an annuity while retaining the rest in retirement accounts and other assets strikes a comfortable balance.<\/p>\n

5. What is \u201clongevity risk?\u201d<\/p>\n

A. <\/b>The risk that you\u2019ll need expensive long-term care<\/a> as you get older.<\/p>\n

B. <\/b>The risk that you\u2019ll live longer than expected and your savings won\u2019t last.<\/p>\n

C. <\/b>The risk that inflation will reduce your purchasing power over time.<\/p>\n

D. <\/b>The risk that your retirement accounts will lose value in a market downturn.<\/p>\n

Correct answer: <\/b>B<\/p>\n

Many people fear outliving their savings\ufeff, understandably \u2014 retirement costs keep rising<\/a>, and people are living longer. \u201cLongevity risk\u201d encapsulates that fear.<\/p>\n

\u201cLiving a long time should be good news,\u201d Whitney says, \u201cbut the challenge is making sure your money lasts as long as you do.\u201d<\/p>\n

One of the most powerful levers you have is choosing when to start collecting Social Security. Delaying your claim<\/a> gets you a higher monthly payment, for life. Waiting until age 70 to file for retirement benefits will result in a 77 percent larger payment than if you claim at 62, the earliest age of eligibility. However, financial, health and family issues can affect the calculus of when to claim.<\/p>\n

But it\u2019s not an either-or between grabbing your benefit as soon as possible or waiting to lock in the maximum payment. The goal is to find a sweet spot for your situation. A financial adviser can help you make this decision, as well as help you determine what adjustments, if any, you should make to you\ufeffr saving, spending and investing strategies.<\/p>\n

You can find one by searching a directory operated by trade groups such as the CFP Board of Standards<\/a>, the National Association of Personal Financial Advisors<\/a> (NAPFA) or the Financial Planning Association<\/a> (FPA).\u200b<\/p>\n","protected":false},"excerpt":{"rendered":"An income annuity is a way to turn part of your nest egg into a steady flow of…\n","protected":false},"author":2,"featured_media":283053,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[177],"tags":[79,18,19,142379,17,142380,234,235,69632,33069,142377,142376,142378],"class_list":{"0":"post-283052","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-eire","10":"tag-ie","11":"tag-income-annuity","12":"tag-ireland","13":"tag-longevity-risk","14":"tag-personal-finance","15":"tag-personalfinance","16":"tag-portfolio-diversification","17":"tag-required-minimum-distributions","18":"tag-retirement-glossary","19":"tag-retirement-terms","20":"tag-sequence-of-withdrawals"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/115890975052452811","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/283052","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=283052"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/283052\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/283053"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=283052"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=283052"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=283052"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}