Fact Sheet: The NRRI and Annuities

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The Fact Sheet’s key findings are:

  • The NRRI assumes that households buy an annuity at retirement.
  • The NRRI (the percent of households ‘at risk’ in retirement) increases from 51 percent to
    • 53 percent if households withdraw 4 percent per year; or
    • 60 percent if households live off their interest.
  • Not annuitizing hurts high-income households the most, because they rely more on their nest eggs in retirement.
  • While few buy annuities today, annuities could improve retirement security for future retirees.