Despite wanting and needing more guaranteed income in retirement, many Americans are hesitant to purchase an annuity to provide that income. Some of this hesitancy is due to misconceptions around the products and how they can best be used to support a secure retirement.
Most people do not understand annuities well. In fact, The American College of Financial Services tested a group of 60- to 75-year-olds, and they got only 20% of the annuity questions right on average — the lowest score of 12 distinct retirement income areas tested in the quiz.
A secure retirement plan requires you to make decisions about how to generate income and, in some cases, whether an annuity fits into your plan. With so many different annuity options on the market, it is important to understand the basics.
Test out your own annuity literacy with this 10-question true/false quiz.