Why Annuities Are a Smart Move in Today’s Volatile Market

A Safe Harbor in a Storm: Annuities Gain Appeal in Uncertain Times

Market volatility is back in the headlines—and it’s forcing many retirees and near-retirees to confront a difficult truth: the traditional 60/40 portfolio may no longer offer the steady, reliable income they once counted on. As interest rates fluctuate, inflation lingers, and equity markets swing wildly, Americans are turning to annuities as a strategic solution to help weather the storm.

In fact, annuities are quietly becoming one of the most sought-after tools for retirement income planning in 2025. Their promise of guaranteed income, protection from market loss, and the ability to hedge longevity risk makes them especially attractive in times like these.

As reported by Barron’s, financial professionals are increasingly embracing annuities—not just for their safety features, but because they fill a growing gap in how people plan for income once the paycheck stops.

Why Income Planning Has Changed

When people think about retirement, they often picture a lump sum saved in a 401(k) or IRA. But a more important question is emerging: How do I turn that savings into income I can’t outlive?

The income challenge has intensified for three main reasons:

1. Increased Longevity

People are living longer. A 65-year-old couple has a nearly 50% chance one spouse will live to age 90. That means your retirement plan might need to last 25–30 years—or more.

2. Market Uncertainty

Sharp swings in the stock market, particularly early in retirement, can have an outsized impact on your portfolio. This is known as sequence of returns risk—and it’s one of the biggest threats to income longevity.

3. Interest Rate Volatility

With bond yields fluctuating and cash returns struggling to keep up with inflation, many traditional “safe” investments aren’t generating enough income to meet retirees’ needs.

This is exactly why annuities are getting a fresh look: they are designed to deliver guaranteed income regardless of what the market does.

The Value of Annuities in a Volatile Market

In uncertain markets, investors are looking for stability. That’s where annuities excel.

Here’s what makes them a standout solution in today’s environment:

• Guaranteed Income for Life
  Certain annuities—especially immediate annuities and those with income riders—can create a reliable, pension-like income stream for the rest of your life. That’s powerful reassurance when markets are unpredictable.
• Protection Against Market Losses
  Fixed Indexed Annuities (FIAs) and Registered Index-Linked Annuities (RILAs) offer market-linked growth potential with downside protection. Your principal is shielded from losses, but you still have opportunities for growth.
• Tax-Deferred Growth
  Annuities allow your money to grow tax-deferred until you withdraw it. That’s a major advantage over taxable brokerage accounts, especially in a rising-tax environment.
• Flexibility in Structure
  Modern annuities come in many forms. Whether you’re looking to start income today or build it for a future date, there’s likely a solution that fits your personal goals and timeline.

What Types of Annuities Work Best Right Now?

Not all annuities are created equal. But several types are gaining traction in 2025 due to their adaptability and potential returns:

When it comes to retirement planning, not all annuities are created equal. At SafeMoney.com, we focus only on annuity types that provide principal protection, guaranteed income, and long-term financial security—especially during turbulent markets.

Here are the five types of annuities we recommend for retirees seeking stability and peace of mind:

1. Fixed Annuities

These offer guaranteed interest rates for a set period of time. Think of them like a retirement-focused CD from an insurance company. Your money grows safely and predictably—no market exposure, no surprises.
Best for: Conservative savers who want steady, predictable growth with no downside risk.

2. Fixed Indexed Annuities (FIAs)

FIAs provide growth potential linked to a market index (like the S&P 500) while protecting your principal from losses. Even in a down year, your balance won’t decline due to market performance.
Best for: Those who want a balance of growth and security, with upside opportunity and no market losses.

3. Immediate Income Annuities

Also known as Single Premium Immediate Annuities (SPIAs), these turn a lump sum into guaranteed monthly income that starts right away. Payments are fixed and can last for life, making them ideal for covering essential retirement expenses.
Best for: Retirees who need income now and want the peace of mind that comes from a pension-like stream.

4. Deferred Income Annuities (DIAs)

With DIAs, you set aside money today and receive guaranteed income starting at a future date—often 5, 10, or even 20 years later. This strategy helps guard against longevity risk and can act as a financial “backup plan” for later in retirement.
Best for: Those planning ahead who want future income guarantees and long-term security.

5. Multi-Year Guaranteed Annuities (MYGAs)

MYGAs lock in a guaranteed interest rate for a fixed number of years—typically 3, 5, or 7. They’re a simple, safe way to grow your savings when CDs or bonds don’t offer attractive returns.
Best for: People looking for a safe, higher-yielding alternative to CDs or Treasury bonds with no market risk.

The Case for Replacing Bonds with Annuities

Many advisors are now considering annuities as bond alternatives—and for good reason.

In years past, retirees could rely on bonds to produce steady income. But today, bond yields are inconsistent, and their value can drop when rates rise. Meanwhile, annuities offer stable income regardless of rate changes, often with higher yield potential and principal protection.

Some advisors are implementing what’s called a “bond ladder with annuities”—allocating the fixed income portion of a client’s portfolio to a mix of guaranteed income annuities. This creates a predictable cash flow schedule without market risk.

Common Concerns—and What to Watch Out For

Despite their benefits, annuities do require careful evaluation. Here are a few points to consider:

• Liquidity: Many annuities have surrender charges. You may not have full access to your funds in the early years.
• Fees: Income riders and market-linked features can carry costs. Be sure to understand what you’re paying for—and that the benefits align with your goals.
• Complexity: Some products are more complicated than others. Work with a qualified advisor who can explain the terms clearly and help you compare options.

Are Annuities Right for You?

If you’re looking for income stability, downside protection, and longevity insurance, an annuity could be a valuable part of your retirement income plan.

Here are some scenarios where annuities make sense:

• You’re worried about outliving your money.
• You’re approaching retirement and want to reduce market exposure.
• You’re seeking to replace or supplement lost pension income.
• You want to cover essential expenses with guaranteed income, freeing up other assets for growth or discretionary spending.

Final Thoughts: Annuities Belong Back in the Conversation

Volatile markets test even the most disciplined investors. In response, many are revisiting the core purpose of retirement planning—not to accumulate the biggest nest egg, but to create income that supports your lifestyle, no matter what the markets are doing.

Annuities offer that kind of financial security. They’re not a silver bullet, but they can serve as a powerful tool—a personal pension you control, backed by a regulated insurance company.

In 2025, with uncertainty swirling, annuities aren’t just “back”—they’re a modern solution for a timeless problem: how to make your money last.

At SafeMoney.com, our network of independent financial professionals is here to guide you — with no obligation and zero pressure.

🧑‍💼 Written by: Brent Meyer, founder and president of SafeMoney.com. With more than 20 years of hands-on experience in annuities and retirement planning, Brent is committed to helping Americans make informed, confident financial decisions.

Disclaimer: This article is for educational purposes only and does not constitute investment, tax, or legal advice. Always consult with a qualified financial professional to evaluate how any retirement income strategy, including annuities, fits into your personal financial plan. Guarantees are subject to the claims-paying ability of the issuing insurer.