A well-structured retirement portfolio should balance growth, security, and guaranteed income. While many clients focus on traditional investments like stocks and bonds, annuities offer unique advantages that can help mitigate risk, ensure stability, and provide lifetime income security. Here’s how annuities can enhance a well-rounded retirement strategy.

1. Enhancing Portfolio Diversification

Market fluctuations can significantly impact retirement portfolios, especially during withdrawal years. Annuities provide a layer of protection by offering guaranteed income regardless of market conditions.

• Fixed annuities provide stability by offering a predictable return.
• Variable and indexed annuities allow for growth with protections to limit downside risks.
• Annuities reduce reliance on market-dependent withdrawals.

Advisor Tip: Position annuities as a complement to stocks and bonds, providing a secure income stream while allowing other investments to grow.

2. Managing Longevity Risk

One of the biggest concerns retirees face is outliving their savings. Annuities can provide lifetime income, ensuring financial security throughout retirement.

• Lifetime income riders ensure payments continue as long as the client lives.
• Delaying annuity payouts can increase monthly income.
• Annuities act as a personal pension, replacing lost wages in retirement.

Advisor Tip: Explain how annuities can serve as a “personal pension,” replacing lost wages and providing income predictability.

3. Reducing Sequence of Returns Risk

Retirees who rely solely on investments for withdrawals risk depleting their portfolios during market downturns. Annuities help safeguard against this by providing guaranteed income streams.

• Reduces the need to sell investments in a down market.
• Provides consistent cash flow regardless of market performance.
• Creates a steady “retirement paycheck” for essential expenses.

Advisor Tip: Demonstrate how integrating annuities into a portfolio can protect against market volatility and improve financial confidence.

4. Leveraging Tax Advantages

Annuities offer tax-deferred growth, allowing clients to accumulate assets more efficiently. Withdrawals may be subject to ordinary income taxes and if made prior to age 59½ may be subject to a 10% IRS penalty tax.

• Earnings grow tax-deferred until withdrawals begin.
• Clients can manage taxable income by structuring annuity payouts.
• Beneficiaries may receive tax-efficient wealth transfers.

Advisor Tip: Position annuities as a tax-efficient vehicle within a client’s broader retirement income plan.

5. Estate Planning and Wealth Transfer Benefits

Annuities aren’t just about retirement income—they also offer estate planning advantages that can help streamline wealth transfer.

• Death benefits can pass directly to beneficiaries, avoiding probate.
• Certain annuities provide guaranteed payouts to heirs.
• Customizable options help align with legacy goals.

Advisor Tip: Incorporate annuities into estate planning conversations, showing how they can preserve wealth for the next generation.

Final Thoughts: The Role of Annuities in a Balanced Portfolio

Annuities provide a powerful combination of security, tax efficiency, and income stability that can enhance any retirement plan.

• Use annuities to provide guaranteed income alongside investments.
• Leverage tax-deferral benefits to optimize asset growth.
• Incorporate annuities to mitigate longevity and market risks.

At New York Life, we make annuities easier—helping you integrate them seamlessly into your clients’ retirement strategies for long-term financial security.

For producer use only-not for distribution to the public.

SMRU 7585905; Expiration 01.30.2026