Annuities convert a lump sum into guaranteed income, which can appeal to solo agers seeking predictable income without relying on ongoing investment management.
Pros
Predictable income regardless of market performance, useful if you'd rather not manage investments actively or worry about outliving savings.
Cons
Often illiquid once purchased, with fees that can be significant, and terms that vary widely between products — not automatically the right fit for everyone.
Have a fee-only (not commission-based) advisor review any annuity offer, since annuities are commonly sold on commission with strong sales incentives.
This article is general information, not financial or legal advice. Rules, costs, and program details vary and change over time — confirm current specifics with a licensed financial advisor or elder law attorney before making a decision.