Comparing Income Options
For those approaching retirement, it’s time to think about how you’re going to draw income from your hard-earned savings in a way that’s best for you.
Below you can review the advantages and disadvantages of various retirement income options. You can use this information to help you select the option – or combination of options – that works best for you. For example, combining a RRIF and an annuity gives you both income flexibility and security.
Fixed Annuities
| Advantages | Disadvantages | |||
| * | Easy to manage | * | Income depends on interest rate at time of purchase | |
| * | Certainty of income payments | * | No investment flexibility | |
| * | Can make a great base for your plans | * | Inflation may erode purchasing power | |
| * | With term annuities holder may outlive income | |||
| * | With life annuities heirs won’t receive benefit | |||
| * | Options for dealing with disadvantages come at costs | |||