You’re (Almost) Never “Too Old” to Benefit from an Annuity
May 20, 2026 by AnnuityAdvantage
Wink’s Moore on the Market: I don’t know that I can agree with this…
In my opinion, there most definitely ARE people that are too old for annuities.
How many want to keep deferring in their [‘80’s]?
How many are going to live long enough to get their principal back in an income annuity, if they purchase one in their [‘80’s]?
What do you think? -sjm
MEDFORD, OR / ACCESS Newswire / May 14, 2026 / “It often is,” says retirement-income expert Ken Nuss, CEO of AnnuityAdvantage. “At this age, most people want to reduce their risk and generate reliable income-two things that annuities do well.”
Whether an annuity will work for you depends on your savings, Social Security and any pension benefits, spending habits, health, age and risk tolerance.
Get off the financial roller-coaster
While the stock market has rewarded investors handsomely in recent decades, older Americans remember gut-wrenching drops in 2002, 2008 and 2022.
“When you’re middle-aged, you can fasten your belt and endure a wild ride on the financial roller-coaster, but it’s a different story when you’re older,” Nuss says.
More retirees are attracted by the guarantees offered by fixed annuities, which can guarantee principal and interest or provide lifetime income and can help counteract the impact of inflation.
Fixed annuities are different from investment-oriented variable annuities, which offer tax advantages but don’t guarantee principal, making them less attractive to older retirees.
“It’s simplistic to say that annuities are ‘good’ or ‘bad’ for people in this age bracket. Most people in their 70s or 80s-except those with so little savings that they need full liquidity-could benefit from an annuity.
“But you have to get the right kind for you,” he says.
Income annuities: make your own pension
An income annuity is like your own private pension. You send the insurance company a lump sum, and it, in turn, contractually guarantees to pay you a stream of income either starting almost immediately or at a future date you choose.
You’ve converted your savings into a future income stream.
Income annuities are very valuable because they can guarantee a steady income no matter how long you live, making them “longevity insurance.” You can also choose a set period for benefits, such as 10 or 20 years, but most people take the lifetime option.
The disadvantage is that you no longer have access to your money.
Therefore, someone in his or her early 70s in good health with good savings but no pension and modest Social Security benefits could be a perfect fit for a lifetime income annuity.
Insurance companies have age limits on new income annuities and typically won’t underwrite anyone older than 85.
Fixed-rate annuities often pay more than CDs or bonds, with tax deferral
Many older people need access to funds and look to secure savings vehicles. These include bank CDs, bonds and deferred annuities.
A multi-year guarantee annuity, or MYGA, is often called a CD-type annuity because it guarantees an interest rate for two to 10 years. If you cancel a MYGA before the term has concluded, the insurance company will levy a penalty.
But many products allow penalty-free withdrawals up to 10% annually, providing valuable flexibility for retirees. Laddering MYGAs (staggering terms) also promotes flexibility.
“Nonqualified” annuities-those not held in a qualified retirement plan-offer tax advantages. They’re tax-deferred: you are not taxed on interest earned as long as you let the interest accumulate in the annuity.
“However, many will allow you to receive regular taxable interest payments if you like, which makes them suitable for retirees who want income while protecting their principal,” Nuss says.
MYGAs can pay markedly higher interest rates today than CDs, with the top performers yielding from 5.70% to 6.30%, depending on the term. Some insurers will issue them for people in their late 80s or even their 90s.
MYGAs are not guaranteed by federal deposit insurance, but they are guaranteed by the issuing insurance company. Insurers are strictly regulated for solvency by state insurance departments.
Check the company’s A.M. Best rating before buying.
Ask your agent key questions
Every annuity agent wants to make a sale and earn a commission. The best ones, however, will engage you and ask questions to help you select the product that best meets your needs.
“That’s in the agent’s long-term interest too because happy clients will spread the word to their friends. An agent who pressures you to make a snap decision isn’t on your side,” Nuss says.
Ken Nuss is the founder and CEO of AnnuityAdvantage, a leading online provider of fixed-rate, fixed-indexed, and lifetime income annuities. Ken is a nationally recognized annuity expert and widely published author.
A free rate comparison service with interest rates from dozens of insurers is available at www.annuityadvantage.com or by calling (800) 239-0356. The firm also offers an income-annuity quoting service. There are no fees or charges for the firm’s services; 100% of the client’s money goes to work for them in their annuity.
Media contact:
Henry Stimpson, Stimpson Communications,
henry@stimpsoncommunications.com
SOURCE: AnnuityAdvantage
