Tag: lifetime income
People are more likely to hoard their savings accounts in retirement. Employers, academics, and policymakers all recognize that drawdown is the major challenge facing the 401(k) system. Participants face the risk of spending their money too quickly and exhausting their assets or hoarding their balances and depriving themselves of necessities. My view is that reluctanc…
Are annuities more valuable when interest rates are low? That seems counterintuitive. After all, annuities produce higher monthly incomes when interest rates are high. But consider the extreme case of a zero interest rate. That scenario eliminates the option of living off the income from investments in retirement. The choices come down to various alternativ…
