# When do annuities actually make sense?

**URL:** <https://boards.straightdope.com/t/when-do-annuities-actually-make-sense/1013738>\
**Category:** In My Humble Opinion\
**Created:** [February 2, 2025, 12:48am UTC](https://boards.straightdope.com/t/when-do-annuities-actually-make-sense/1013738 "2025-02-02T00:48:21Z")\
**Posts on this page:** 4\
**Page:** 2

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**Author:** ![chela](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chela/32/21582_2.png) [@chela](https://boards.straightdope.com/u/chela)\
**Post date:** [February 2, 2025, 7:22pm UTC](https://boards.straightdope.com/t/when-do-annuities-actually-make-sense/1013738/21 "2025-02-02T19:22:40Z")

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I think these are a fairly recent development.

More analysis here on QLAC

> **[Curious About a QLAC? SECURE 2.0 Act Gives This Annuity a Boost](https://www.kiplinger.com/retirement/qlac-secure-act-gives-this-annuity-a-boost)**
>
> New legislation raises the amount you can transfer from your rollover IRA to a qualifying longevity annuity contract (QLAC), reducing RMDs and increasing guaranteed lifetime income.

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**Author:** ![Kent\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kent_clark/32/105_2.png) [@Kent\_Clark](https://boards.straightdope.com/u/Kent_Clark)\
**Post date:** [February 2, 2025, 10:49pm UTC](https://boards.straightdope.com/t/when-do-annuities-actually-make-sense/1013738/22 "2025-02-02T22:49:19Z")

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My single-premium annuity policy grew steadily for the 20+ years I had it before I started taking the payout. I know exactly when the cash-out value of it will hit zero (when I’m 81 years old.) Since several of my relatives lived past age 100, and my sister, despite several bouts with cancer, is now 83, I’m betting I will beat the actuarial odds.

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**Author:** ![DSeid](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dseid/32/20194_2.png) [@DSeid](https://boards.straightdope.com/u/DSeid)\
**Post date:** [February 3, 2025, 12:49am UTC](https://boards.straightdope.com/t/when-do-annuities-actually-make-sense/1013738/23 "2025-02-03T00:49:40Z")

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Thank you for the link.

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**Author:** ![rbroome](https://avatars.discourse-cdn.com/v4/letter/r/838e76/32.png) [@rbroome](https://boards.straightdope.com/u/rbroome)\
**Post date:** [February 3, 2025, 12:59am UTC](https://boards.straightdope.com/t/when-do-annuities-actually-make-sense/1013738/24 "2025-02-03T00:59:05Z")

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I have been happy with my annuities. They are only part of my retirement, but have done well. They were one of those deals where you invest a certain amount, wait ten years for the amount to double (one was a guarantee and one did almost as well), then get a constant % (5 or 6) of the principal at 10 years for life. The annuity has survivorship and the balance if any is returned when the beneficiaries pass. It worked as advertised, and so far the principal has remained constant. Of course I am locked in to the deal and so the amount will never change. Inflation will reduce the benefit, but that isn’t the fault of the annuity. FWIW, one annuity has done slightly better than my 401K, the other annuity slightly worse. I am glad I have it but also glad it isn’t my only retirement income.

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