I have always been on the no annuity train but I'm now considering a QLAC. I 'think' the QLAC is good for my situation but I don't know if I'm not seeing something I should and it will bite me later.
Here is my situation. Can you please let me know, given my circumstances, whether you think I should get it? If you don't think I should please let me know why. Thank you.
My situation:
I am 55, single, no heirs. I have worked for myself for the last 23 years. Some years were good, some not so good. The business is now on a downturn and I'm trying to eke out enough income from it to get to retirement. I have my money in various Vanguard funds as well as savings and they have done well but I feel like that is more the market than any great investing sense on my part.
Obviously I can't predict my longevity but most people in my family live into their 90s or early 100's. My parents are both 85 and still in good shape mentally and physically.
I won't have any help when I'm older and my biggest stress is not knowing if I will outlive my money. It keeps me up at night. I'm freaked I won't have enough.
I figure I will need $80,000 in income a year. That may be too much but I would rather overestimate than underestimate.
I could spend $200,000 now from my IRA for a QLAC from an A+ rated company (Mutual of Omaha) which would get me $144,000 per year when I am 85 and would pay that amount for the rest of my life. I do not plan to claim SS until I'm 70 so with SS and the QLAC payments I'm estimating at least $164,000/year from the time I'm 85 until I die.
According to FireCalc, if I am able to work for another 5 years and not put any new savings in to what I have now I will have enough money to retire with a 100% success rate.
So, basically, with the QLAC I would be set up for 2 retirements - one from my savings/IRA that will get me to at least 85 and another one after I'm 85 from the QLAC.
I know there are a lot of good investors on here but I am not confident enough in my investing that I think I can turn the $200,000 into $2,000,000 which is what I will get from the QLAC if I live to 100.
I feel like getting a QLAC is a no-brainer for me giving my circumstances and I feel really relieved just thinking about having a secured income that comes from somewhere else other than my savings that I can count on but I wonder if I'm not seeing something that I should with it.
Thoughts? Thank you.
Here is my situation. Can you please let me know, given my circumstances, whether you think I should get it? If you don't think I should please let me know why. Thank you.
My situation:
I am 55, single, no heirs. I have worked for myself for the last 23 years. Some years were good, some not so good. The business is now on a downturn and I'm trying to eke out enough income from it to get to retirement. I have my money in various Vanguard funds as well as savings and they have done well but I feel like that is more the market than any great investing sense on my part.
Obviously I can't predict my longevity but most people in my family live into their 90s or early 100's. My parents are both 85 and still in good shape mentally and physically.
I won't have any help when I'm older and my biggest stress is not knowing if I will outlive my money. It keeps me up at night. I'm freaked I won't have enough.
I figure I will need $80,000 in income a year. That may be too much but I would rather overestimate than underestimate.
I could spend $200,000 now from my IRA for a QLAC from an A+ rated company (Mutual of Omaha) which would get me $144,000 per year when I am 85 and would pay that amount for the rest of my life. I do not plan to claim SS until I'm 70 so with SS and the QLAC payments I'm estimating at least $164,000/year from the time I'm 85 until I die.
According to FireCalc, if I am able to work for another 5 years and not put any new savings in to what I have now I will have enough money to retire with a 100% success rate.
So, basically, with the QLAC I would be set up for 2 retirements - one from my savings/IRA that will get me to at least 85 and another one after I'm 85 from the QLAC.
I know there are a lot of good investors on here but I am not confident enough in my investing that I think I can turn the $200,000 into $2,000,000 which is what I will get from the QLAC if I live to 100.
I feel like getting a QLAC is a no-brainer for me giving my circumstances and I feel really relieved just thinking about having a secured income that comes from somewhere else other than my savings that I can count on but I wonder if I'm not seeing something that I should with it.
Thoughts? Thank you.