Thanks for the real numbers! I try to look at a lot of strategies and though I am only in my mid-50s I am intrigued by the simplicity of a SPIA to be bought between the ages of 78 to 82. This strategy is put forward by the guys on the Retirement and IRA podcast (Jim and Chris) and they point out that we may not be as mentally sharp at that age and the certainty of guaranteed income to cover the minimum dignity floor (MDF) is what they advise their clients to do.I just did a quick comparison of a TIPS ladder vs. SPIA. To fund 30 years of $40,000 inflation adjusted income (tipsladder.com), the cost today is $868,978. The same $868,978 for a 55 year old male provides a SPIA payment (immediateannuities.com) of $57,252. The TIPS ladder payments will continue to increase with inflation but will end after 30 years. The SPIA starts off at a higher amount that will remain the same and be eroded by inflation over time. The SPIA is for life which protects on the longevity side. The TIPS ladder allows the investor to maintain control of the investments (instead of turning it over to an insurance company).
Surely, many here would say go with a TIPS ladder earlier in life...
Statistics: Posted by ichee_marone — Sun May 05, 2024 7:32 am — Replies 121 — Views 11842
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