How to Use Laddering Annuities for Retirement Income

Shawn Plummer

CEO, The Annuity Expert

If you’re looking for a way to create a steady stream of retirement income, you may want to consider laddering annuities. This investment strategy can be a great way to ensure that you have a regular income stream in retirement. This guide will discuss laddering annuities and how they can help you achieve your retirement goals.

What Does Laddering Annuities Mean?

Laddering annuities is a strategy that involves investing in multiple annuities with different maturity dates. This allows you to create a “ladder” of income streams, providing you with a steady income stream in retirement.

Related Reading: What is a good monthly retirement income?

Annuity Ladder

How Does An Annuity Ladder Work?

An annuity ladder works by investing in multiple annuities with different maturity dates. This allows you to create a “ladder” of income streams, providing you with a steady income stream in retirement.

For example, let’s say you have $100,000 to invest and want to create an income stream that will last for 20 years. you could ladder annuities as follows:

  • First, invest $20,000 in an annuity that matures in five years.
  • Next, invest $40,000 in an annuity that matures in ten years.
  • Finally, invest $60,000 in an annuity that matures in fifteen years.

This would give you three different income streams, each of which would last for five years. After the first annuity matures, you would have $20,000 annually to reinvest in a new annuity. This strategy can provide you with a steady stream of income that can last for 20 years or more.

Laddering Annuities

The Benefits

One of the benefits of laddering annuities is that it can help you manage your risk. In addition, investing in multiple annuities can diversify your portfolio and reduce your overall risk.

Another benefit of laddering annuities is that they can provide flexibility in retirement. For example, if you need to access your money for an unexpected expense, you can do so without penalty.

The Drawbacks

One of the drawbacks of laddering annuities is that it can be more expensive than investing in a single annuity. This is because you are effectively buying multiple annuities.

Another drawback to this strategy is that it can take longer to reach your financial goals. This is because you are investing in multiple annuities with different maturity dates.

Laddering Income Annuity Strategy

Next Steps

 Laddering may be a good option if you’re considering investing in annuities. However, it’s essential to understand the risks and costs associated with this investment strategy before making a decision. Contact us today for more information or a quote. We can help you find the right annuity plan to fit your needs and budget.

Laddering Annuities

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Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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