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Setting up an annuity for retirement

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Steve O., age 66
Danbury, Connecticut
Married, three children
"As I got ready to retire, I should have set up annuity-type income streams."

Steve's Tips

  • Be realistic. Sometimes you have to adapt your long-term plans.
  • For long-term income, an annuity may be a better bet than stocks, which can be volatile.
  • Take time before you retire to understand the medical coverage you will need later.


  • Early in the downturn, Steve changed course from selling stock for income to obtaining an annuity.
  • He did a thorough analysis of Medicare benefits to get the plan that worked for him.

Steve thought he had a good investment strategy, but the market downturn prompted a change from stocks to something more stable.

"My original plan for stocks was to sell what I needed when I needed it—a great strategy in November 2007. But when the market went down, I had to rethink. I took a substantial amount out of the stock market and set up an annuity. I should be able to take 5% to 6% out of it for life."

First things first: Untangle Medicare coverage.

"My advice to anyone about to retire is to review the 100-page Medicare booklet before you leave your company and your coverage changes—it took me three months to get through it.

"I had medical coverage from my former job, but when it came time to choose a Medicare plan I didn't realize that Medicare charges more for higher income individuals; it can be $200 to $300 per month. I ended up taking Plan D coverage because my personal plan doesn't cover prescription drugs."

Take the Next Step.

Let's talk about the retirement you want.

Call 877-673-7970 for your complimentary retirement consultation.