by KYW's Salil Gutt

It is during bear markets that retirees appreciate the value of a pension check compared to the volatility that comes when you are responsible for managing your own retirement money. In fact, sales of fixed annuities are expected to soar as the population ages.

With a fixed annuity you give the insurance company a lump sum of money. They in turn promise you and your spouse a monthly check that neither of you will outlive regardless of how the stock market performs in the future.  What gives people pause about this product is there is no residual benefit to children or other heirs when the recipients die. One way to reduce this risk is to not invest more than a quarter of your portfolio in immediate annuities.  Usually tend to buy annuities at the time they start collecting a social security check. At that time they will know precisely what monthly check will result from the total of social
security and immediate annuity payments.

One last item. Get a higher monthly check for your annuity by cutting out the middleman and buying direct. At either Vanguard and Fidelity you can buy commission free.