A contract with an insurance company that turns a lump sum into a payment that continues for as long as you are alive — the one instrument built specifically against the risk of living a long time. Lifetime income requires electing an income option or rider, and every guarantee rests on the issuing carrier's claims-paying ability.
A portfolio can be drawn down badly in the wrong five years. An annuity moves that risk to the carrier: you hand over a premium, the contract defines what comes back and for how long, and the obligation does not end because the market had a decade you did not plan for.
Rates, surrender periods and income riders vary widely between carriers for the same money. I shop the whole shelf and show you what each contract actually pays — including what it costs you in liquidity to get there. Every recommendation is documented to California's best-interest standard, in effect since January 2025.
Money that lands here
401(k) / TSP rolloverAt retirement
Property or business saleProceeds
CD or savingsSeeking a rate
InheritanceThat has to last
Pension lump sumvs. the monthly
Free withdrawal~10% / yr typical
Penalty age59½ · IRS
Mechanics · 01 — 04
§ 02How it runs
The four kinds, plainly
Which one fits comes down to two questions: when does the income need to start, and how much of it has to be guaranteed.
01
Multi-year guaranteed
A fixed rate locked for a set term — the closest thing to a CD inside an insurance contract, with tax deferral while it sits.
02
Fixed indexed
Credited off an index with a floor of zero and a cap or participation rate. Principal is not exposed to market loss; the upside is limited.
03
Immediate
Income starts within about a year of the premium. The highest payout per dollar and the least flexibility — the money is committed.
04
Deferred income
Fund it now, switch income on at a chosen age. Waiting raises the payout, often through a rider with its own annual fee.
Fit · and the trade
§ 03Judgment
This fits you if
You are within about ten years of needing the money to produce income.
Social Security and any pension do not cover your fixed monthly expenses.
A bad sequence of market years early in retirement would genuinely change your life.
You can leave the premium alone through the surrender period.
What you have to weigh
Surrender charges apply for a defined period; most contracts allow about 10% a year out without them.
Income riders carry annual fees, and the “income value” they quote is not a walk-away balance.
Withdrawals before 59½ can carry a 10% federal penalty on top of ordinary income tax.
Every guarantee rests on the carrier's claims-paying ability, so the carrier's strength matters as much as the rate.
Data · sourced
§ 04Reference
$464Bplaced in U.S. annuities in 2025 — a fourth straight record.LIMRA · 2025 sales
30 dfree-look for California buyers 60 and over — full refund.Cal. Ins. Code §10127.10
59½before which withdrawals may incur a 10% federal penalty.IRS · Topic 410
8 hof annuity training before a California agent's first sale; 4 h each renewal.Cal. Ins. Code §1749.8
A private conversation · no fee · twenty minutes
What would your money actually pay?
Tell me the amount, your age, and when the income needs to start. I will come back with quotes from several carriers, with the surrender schedule and rider fees on the same page.