by KYW's Salil Gutt

The financial services industry is hell bent on meeting the needs of future boomer retirees. A check a month option along with the promise of never outliving money is the quest. 

The insurance industry has a product called an immediate annuity. You give the insurance company a lump sum of money and they will promise you a monthly check for as long as you and your spouse will live. You win if you live to 95, they win if you die early.

N ow the mutual fund boys have comes up with their offering.  Its called a managed payout fund. You give the funds a lump sum of money and they give you a monthly check for a defined period of time, not a lifetime.  The amount may vary depending on how the market performs and the investment strategy.

It appears to me the immediate annuity would make more sense if the objective is a guaranteed amount for life. An investor would be able to achieve the same results as a managed payout fund just by proper diversification and a prudent withdrawal of monies. Another middleman just adds to the expense.