Should you buy an annuity from Social Security?
The key findings of
this study from the Boston College Center for Retirement Research are:
- Households now
retiring need to transform their 401(k) and IRA
savings into retirement income.
- One way is to delay claiming
Social Security to increase their monthly benefit, using savings to pay
current expenses while they wait.
- In effect, they are buying an
annuity from Social Security: The savings used is the “price” and
the increase in their monthly benefit the annuity income it “buys.”
- Buying an annuity from Social
Security is generally the best deal in town, especially in
today’s low interest-rate environment.