rescueme
Thinks s/he gets paid by the post
Interest rates on an SPIA change as frequently as each week; that was the case for me/DW when we purchased ours.Interest rates may have dropped a bit since this article was written.
It quotes $7,397 a month on that million for a 66 yr old M, for Illinios I got $6,499 a month as a quote today.
Rates changed within a week of our completed application being received. Since the policy had yet to be issued, we completed another application (overnight) to take advantage of the slightly better rate.
Also, be aware that depending on your requirements there are several options that will increase/decrease your monthly income.
Apply for an SPIA later in life? Your payment goes up.
Apply for an SPIA that has a guaranteed term (e.g. payments continue to your estate, even if you die)? Your payment goes down.
Apply for an SPIA that is inflation adjusted (few offered), but the initial payment will usually be lower than a standard non-adjusted SPIA.
You really need to understand the type of SPIA, or if an SPIA will even make sense in what you want to do. For us, it primarily provided a "pension" until we draw full SS. Payments after that time will certainly be worth less (due to inflation) but then again, we delayed filing and "upgrade" to a superior inflation adjusted product, e.g. SS. Payments will continue after that time and will just be icing on the cake (along with reducing the impact of excess RMD's in the future).
There is no "standard answer" when talking about SPIA's. You need to determine if you need one, along with a policy (if you find you do) that meets your persional retirement income and RMD plans.