Q: I wonder if single-premium immediate annuities (SPIAs) are for me. I am 75. My wife is 73. We have no debt, $850,000 in IRAs (mostly...

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Q: I wonder if single-premium immediate annuities (SPIAs) are for me.

I am 75. My wife is 73. We have no debt, $850,000 in IRAs (mostly in the American Fund family) and $150,000 in a Roth, again with American.

We also have $150,000 in CDs and money markets in taxable accounts.

We live decently on Social Security, pensions and my IRA minimum required distributions. I don’t feel that I can think very “long term.” So I want to avoid some market risk.

SPIAs have come to my attention via an AARP offer with NY Life. I am considering spreading some of my funds around in laddered SPIAs. Is this a good idea?

Most financial advisers I have spoken with jump immediately to variable annuities (with “living benefits”), I suspect due to larger commissions.

A: You’re on the right track and, yes, the sales people who promote the living-benefit route are receiving handsome commissions.

You can reduce your risk and possibly increase your estate by doing exactly what you suggest — laddering a number of single-premium life annuities.

While the principal will be gone, your current monthly payments will increase. Less (or none) of your required minimum distributions will need to come from liquidating equity investments.

You’ll get the security of a solid monthly income, and your equity investments may grow with less risk of being sold in a down market.

Research has shown that using some amount of SPIAs is a good option for all households, including those with a desire to leave some money to heirs.

The expenses of a popular living-benefit product are so high that you’d be far better off dividing your existing money between a life annuity and regular low-cost mutual funds.

Questions: scott@scottburns.com