With inflation and market volatility, do annuities make sense for pre-retirees?

Financial advisors regularly emphasize the importance of saving for retirement, no matter what stage of life or career a person may be in. However, as someone gets closer to retirement age, priorities begin to shift and different considerations are made. Specifically, the 10 to 15 years leading into retirement are an important time to begin safeguarding investments while they continue receiving returns.

People at this life stage, generally referred to as pre-retirees, could benefit from adding a fixed annuity to their retirement portfolio as a safe money product option. An annuity is an insurance contract that is created when an individual makes a payment (or a series of payments) called premium(s). In return the insurer offers crediting options (or interest) for accumulation or periodic payments back to the individual. Fixed index annuities, which track market indexes like the S&P 500, have several features that can benefit pre-retirees, including: