More on whether I should annuitize

Louise, since you are with Fidelity, I suggest that you try out their Retirement Income Planner on Fidelity.com. In an hour or two, you can enter your assets and living expenses and it will estimate the probability that your portfolio will last as long as you do. It also will make suggestions and let you try what-ifs. One of the what-ifs is purchasing an annuity, so you can see what impact that will have on your situation. Other what-ifs include reallocating your investments. I've found it quite helpful to get an idea if I'm on the right track. Give it a shot and see what you learn.

Dave

Do you have a medical condition that will reduce your lifespan? Or, force you into an assisted living situation?

That's a good idea.

Do you wish to leave an inheritance?

If you have a shortened life expectancy, you may be better off avoiding an annuity unless the annuity reflects your shortened life expectancy.

You are better off postponing the annuity because the effective pay- out rises quickly with age. I would suggest waiting at least until age

2. And, as I suggested in the other thread, postpone your taking Social Security.

Yes, stay in the funds.

ETF funds work quite well, but may not be available in a 401k.

You want to cover the entire stock market in terms of large caps and small caps.

I you can get an energy fund for about 20% of your investable assets, inflation should be covered.

-- Ron

snip

If you would give the numbers some better precision, it would help. Also, how its divided between post tax and pre-tax accounts. And how much do you need to withdraw each year? As I suggested to Hector, there should be an asset allocation that will let you sleep but provide some hedge against inflation. I also suggest reading the articles at

site belongs to the author Scott Burns and has quite a few articles regarding asset allocation and safe withdrawal rates, as well as the anti-VA belief I subscribe to. There is also the concept of risk/reward and standard deviation that's worth understanding. Right now, the risk-free rate is about 5%, for any greater return, you run the risk of losing money. The stock market return (US market S&P data), is just over 10% but with a 16% or so standard deviation. This means up years and down years. A good portfolio will reduce your risk but reduce return by just a bit over time. JOE

Since you are already a Fidelity customer, you might want to spend some time looking at their array of income products. Yes, they have annuities, probably cheaper than the one you've been looking at, but they also have a variety of mutual funds designed for income. I see they also have something new, called an Income Replacement Fund. I don't know anything about this product, but it sounds like it's worth investigating in your situation. Additionally, do you qualify to take your ex-husband's social security? It sounds like it would be well-taxed for you, yet it would offer some of that income replacement you're seeking.

Elizabeth Richardson

Thanks for the info and I will look at the fidelity site.

What would make me eligible to take my ex husband's SS - he never re-married but we've been legally divorced for about

12 years before he died. How do I find out about this?

Thanks

Louise

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is the authoritative place. I believe you areeligible for the larger of your benefits or your husband's as long as you weremarried for at least 10 years.-- Doug

Thanks - he had another child who is permanently disabled (cerebral palsy) and it seems that child trumps me as to who gets the social security.

Louise

You sure you read that right? Please see

(the SSA site URL for the page is huge, this will drop you right in to it). But one line from the page I was on shows: "The benefits paid to a divorced spouse or a surviving divorced spouse will not affect the benefit amount paid to other family members who receive benefits on the same record." A child cannot 'trump' you. Only your own (better) record, or you remarrying. The SS benefit will help you determine your need, which will help us all offer a more precise mix. JOE

While you're looking at social security issues, keep in mind your full retirement age. Since you're still employed, whether you decide to take your ex's SS or your own, you want to have reached full retirement age, else your earned income will reduce your SS benefit. Not knowing for certain your birth year nor your exact age, I think you have about a year before SS is truly an option. You will need to continue to draw on the insurance money in the meantime.

Elizabeth Richardson