Dave Mello

Horizon Retirement Advisors, LLC

Empowering Conservative Investors

Longevity risk, the possibility of outliving one's financial resources, is a significant concern for conservative investors, particularly those nearing or at retirement age. As a retirement planner, addressing this risk is vital to ensuring my clients a secure and comfortable retirement.

The concept of longevity risk is rooted in the unpredictability of life expectancy. With advancements in healthcare and living standards, people live longer than ever. While this is a positive development, it poses a financial challenge: sustaining income over a potentially longer-than-expected retirement period. This is where annuities come into play, serving as a tool to mitigate the longevity risk.

Annuities are financial instruments that offer a steady flow of income for a set duration or throughout the annuitant's life. Certain annuities can benefit conservative investors, especially those already in retirement or close to it.

Immediate Annuities: Upon retirement, one can invest a lump sum into an immediate annuity to start receiving regular payments almost immediately. This is ideal for retirees who need a steady income source right away.

Deferred Annuities: For those still a few years away from retirement, deferred annuities allow the investment to grow tax-deferred before the income phase begins. It's a way to ensure that a part of the retirement portfolio is dedicated to providing a stable income later.

Fixed Annuities: These annuities offer a guaranteed fixed income, shielding retirees from market volatility. This is particularly appealing to conservative investors who prioritize stability over high returns.

Inflation-Adjusted Annuities: Since retirement can last several decades, inflation can significantly erode purchasing power. Inflation-adjusted annuities increase payments over time, helping maintain the income's actual value.

Longevity Annuities: These are deferred annuities that start paying out at a later stage, for example, at age 80 or 85. They serve as a hedge against outliving other retirement savings.

Each of these annuity types has its advantages and considerations. Immediate and fixed annuities provide security and simplicity but may offer lower returns than more aggressive investment strategies. Deferred and longevity annuities provide higher potential income but require one to be comfortable with the lack of liquidity for a part of their portfolio. Inflation-adjusted annuities protect against the cost of living increases but start with lower initial payments.

In choosing the right annuity, it's crucial to consider the investor's overall financial situation, health status, risk tolerance, and retirement goals. For instance, someone with a family history of longevity might prioritize a longevity annuity, while another with immediate income needs might opt for an immediate fixed annuity.

As a retirement planner, I help clients navigate these options, balancing the need for immediate income, the desire for investment growth, and the necessity of managing longevity risk. By integrating annuities into a comprehensive retirement plan, we can offer peace of mind to conservative investors, ensuring that their retirement income sustains them throughout their golden years.

Are you concerned about outliving your retirement savings? Let's explore how annuities can provide financial security and peace of mind in your golden years. Contact me today to discuss a personalized retirement plan that aligns with your goals and ensures a comfortable and secure retirement. Your journey towards a worry-free retirement starts here.


  • Longevity Risk: A major concern for retirees, defined as the risk of outliving financial resources.
  • Annuities as a Solution: Annuities offer a guaranteed income, essential for managing longevity risk.
  • Types of Annuities: Includes immediate, deferred, fixed, inflation-adjusted, and longevity annuities, each catering to different needs.
  • Personalization is Key: The choice of annuity should align with individual financial situations, health, risk tolerance, and retirement objectives.

Many people have learned about the power of using the Safe Money approach to reduce volatility. Our Safe Money Guide is in its 20th edition and is available for free.  

It is an Instant Download.  Here is a link to download our guide: 

Safe Money Guide - Annuity.com

Dave Mello picture

Dave Mello

Horizon Retirement Advisors, LLC

707 Mount Rose St.

Reno, Nevada 98509


(775) 851-4754

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