Longevity risk is the financial uncertainty linked to a longer-than-expected lifespan. There’s a very real possibility of outliving your retirement savings and having insufficient funds to support your lifestyle as you head into your advanced years. At this stage, common retirement issues are multiplied by an order of magnitude, such as inflation, healthcare costs, and taxes.
That’s why it’s vital to secure income solutions that are either lifelong, tax-free or, optimally, both. For example, holding off on using your Roth account can provide a great tax-free source of income, while an annuity or an IUL policy can secure a consistent stream of income for the rest of your life.
Each of these instruments can be customized to suit your financial needs and goals. Besides providing tax-free and lifelong income, they also serve as effective vehicles to transfer wealth to the next generation.