Quote:
Originally Posted by Innserelli
It depends on you financial needs, goals and comfort. If you need an income stream now, an annuity can fill the need. If you don't need the money right now, there are better investments, all of which have been mentioned previously. An S&P 500 ETF can be expected to deliver about 8% over the long haul, and is "fairly" safe. If you have time, such an ETF or other investment will probably net you more. However, if you feel the stock market is shaky or your risk tolerance is very low, once again, an annuity could be a good investment for you.
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The OP stated he is 66.
I agree with your comment that the S&P500 has historically returned 8% over the long term. However, if you look at the S&P500 historical rolling 10 year return, you will find that there has been been 10 year periods where investors lost money. So “longterm” is very important
If you are in your 20’s, 30’s or 40’s, then you have the “long term” advantage on your side because you will not need the funds until far in the future.
However, a 66 year old who needs the income in the next 5 or 10 years, should not expect 8% returns because they will be removing capital if the market is down. If however, you are a wealthy 66 year old and will not need any of the money invested in the S&P500 for 15 or 20 years, then an 8% return is much more realistic