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According to LIMRA annuity sales in 2023 showed significant growth for many types of annuities.  Often known as the opposite of life insurance, annuities aim to reduce the risk of outliving money.  Financial Advisors often recommended annuities to help supplement retirement income.  And while annuities have many benefits, they also have risks.  In this article, we’ll explore annuity pros and cons for nurses to help you decide if one aligns with your retirement goals.

Understanding Annuities

Annuities are financial products designed to provide a steady income during retirement. They are typically purchased from insurance companies and come in different forms, each with unique features.

Pros of Annuities

Guaranteed Income

Annuities can provide a steady income during retirement. Financial Advisors often recommend annuities to supplement Social Security and other retirement income.

Tax-Deferred Growth

Your investment in an annuity can grow tax deferred. This means you won’t pay taxes on the earnings until you start receiving payments.

Death Benefit

Some annuities offer a death benefit.  This helps ensure that your beneficiaries receive a payout if you pass away.


Annuities come in many types.  This helps you choose one that aligns with your financial goals and risk tolerance.

Flexibility in Payout Choices

Annuities offer different payout choices.  You can receive a lump sum or spread the distributions out over time.  The payout choices allow flexibility in your retirement plan.

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Free Out Withdrawal

Some annuity contracts allow a “free out” withdrawal every 12 months.  This is typically a percentage of the money you can withdraw without penalty.

Cons of Annuities

Fees and Surrender Charges

Annuities can come with high fees.  This can impact the overall returns on your investment.  And if you need to withdraw money from an annuity before a certain period, you may face surrender charges, reducing your returns.

Lack of Liquidity

Some annuities have limits on withdrawals.  This may present a challenge if you need money for an emergency, outside the free out amount.


Understanding the different types of annuities and their features can be challenging.  For example, there are three primary types of annuities: fixed, variable, and indexed.

There are different ways to buy an annuity like paying one premium or making contributions.  There are different payout methods, like a lump sum or receiving payments over time.  And there are fees and contract terms.  Because of their complexities, consider speaking with a Financial Advisor to help choose the annuity type and terms that align with your financial goals.

pros and cons sign image on annuity pros and cons blog post on www.drgeorgenecollins.comIn conclusion, annuities offer steady retirement income.  But consider the annuity’s pros and cons before you buy one.  By weighing the features, benefits, and risks, nurses can decide if an annuity aligns with their financial goals.  Because an annuity is a contract and there are many types and terms, consider speaking with a Financial Advisor to help you decide if an annuity fits your overall retirement plan.

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Categories: Retirement Income

Georgene Collins

Georgene Collins, RICP®, RN, PhD, MBA is a registered nurse turned Financial Advisor at Airey Financial Group. Georgene helps other nurses take control of their finances and prepare for retirement. Georgene began her career with Airey Financial Group in 2017 after retiring from 30 years in healthcare. Georgene holds the Retirement Income Certified Professional (RICP®) designation from The American College of Financial Services. She holds health and life insurance licenses and a long-term care certificate in Indiana, Illinois, and Wisconsin. Georgene is a Registered Representative and Investment Advisor Representative and has earned the FINRA Series 63 and 65 registrations.