When a person plans for their retirement-income. Deferred income annuities (known as longevity annuities) have become a popular way to protect against the risk of outliving your money in retirement, and not worrying about minimum distributions to make it even more attractive.
With deferred income annuity, the person can invest a lump sum at ages 50s or 60s and lock in a guaranteed lifetime payout that starts at a later date. Having this guaranteed income stream kicks in after a certain age can help you plan withdrawals from the rest of your savings.
The longer the payouts are deferred for, the bigger the bang for the buck. So, if the investment is
The average buyer of deferred income annuities is about 59 and defers the payouts for 7 or 8 years. Removing the minimum distribution creates an opportunity for people to get higher payouts by deferring longer.
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