The total amount a 65-year-old couple retiring in 2021 can expect to spend on healthcare over their life expectancies could fall anywhere between $156,000 and $1 million, according to HealthView Services, a leader in healthcare cost projections.¹ “It sounds daunting,” says Michael R. Harris, a senior educational advisor with the Alliance for Lifetime Income who holds CFP, CLU and ChFC designations. “What you really have to have is an income stream to help you pay for your bills on an annual basis, not a lifetime basis,” Harris says. Let’s look at how annuities can play a role in generating that income.
THE RETIREMENT INCOME PYRAMID
One way to look at how much income you’ll need in retirement is to categorize your anticipated expenses into needs, wants, and wishes. What goes into the needs category? Shelter, food, clothing, transportation—and healthcare. That’s the base of the pyramid, the solid footing. Wants might include family vacations and a boat or RV purchase. Wishes might include paying for