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A married couple with only one spouse currently working outside the home plans to retire in...

A married couple with only one spouse currently working outside the home plans to retire in several years. An annuity that would be particularly suitable for saving for that retirement would be

Select one:

a. a straight life annuity on the life of the working spouse,

b. a straight life annuity on the life of the nonworking spouse,

c. a deferred joint and survivor annuity,

d. an immediate joint and survivor annuity.

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Answer #1

Suitable option for the spouse will be Option 3.

Joint and survivor annuity type of annuity keep providing retirement payment even of only one spouse is alove. i.e. even if one person dies, the other spouse keeps getting the payments.

Also, deffered annuity facilitates the payment for retirement plan through a series of payment, which could be monthly or yearly or any period. As against immediate annuity which requires all payment to be made at the beginning of buying the plan, which would be difficult for this couple as only one of them is working.

option 1 and 2 are not recommended becasue the retirement benefit will stop in that case when 1 spouse dies. This will leave the other spouse without any income.

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