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There is plenty of financial advice screaming that you should stay away from Annuities, but the truth, when you apply federal regulations, is the simple fact that, yes, if you are relying on Social Security in any way you need an Annuity.

The reason is quite simple: due to federal regulations your Social Security benefit will not grow over time.

For those in retirement federal regulations state:
  1. You must accept Medicare when eligible in order to receive your Social Security benefit.
  2. The bulk of your Medicare premiums is deducted from your Social Security benefit.

This may not seem like much of a big deal, but historically Medicare premiums have been inflating at more than 2 times what Social Security’s cost of living adjustment (COLA) has been growing at.

Over the last 20 years Medicare premiums and Social Security’s COLA have adjusted as follows:

Social Security COLA

Medicare premiums

5-year avg



10-year avg



15-year avg



20-year avg



It should be somewhat clear that over time your Social Security benefit will never increase at the rate expected.

An example of what a 60-year person, who earned $60,000.00 a year from employment and plans on retiring at age 67 should expect from their Social Security benefit:

Why an Annuity?

If you are like most retirees Social Security will be a big part of your income. According to Social “48% of married couples and 69% of individuals receive 50% or more of their income from Social Security.

Because of Medicare being mandatory and inflating at a rate higher than your Social Security in retirement you will need to offset that loss of guaranteed income.

Yes, there are plenty of ways to invest in order to generate an income, but which financial product can guarantee that income for the rest of your life?

Yes, you need an Annuity.
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