The Income Gap – Diversified Insurance Brokers

Social Security and annuities can work together to create a stable foundation of guaranteed income in retirement. While Social Security provides a reliable monthly benefit for life, it often isn’t enough to cover all your expenses—especially with rising costs and longer life expectancies.

That’s where annuities come in. By incorporating a fixed or lifetime income annuity, you can fill the gap between what Social Security provides and what you actually need to live comfortably. Annuities help reduce the risk of outliving your savings, give you greater control over your income timeline, and bring added peace of mind by ensuring that your essential expenses are covered—no matter how long you live.

How Social Security And Annuities Work Together For Retirement

Looking to strengthen your retirement income plan? Combining Social Security with annuities can help create a steady, predictable income stream that lasts a lifetime. While Social Security provides a guaranteed monthly benefit, it often covers only a portion of your expenses—leaving a gap that needs to be filled.

That’s where annuities come in. A well-structured annuity can provide guaranteed income for life, helping to cover essential expenses and reduce your dependence on market-based withdrawals. Together, these two income sources offer greater financial stability, protect against longevity risk, and give you more confidence to spend in retirement without fear of running out of money.

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Guaranteed Income from Two Sources

Social Security is a dependable, government-backed source of lifetime income—but for most retirees, it’s not enough on its own. To strengthen your financial plan, consider adding a lifetime income annuity. Annuities provide guaranteed monthly payments you can’t outlive, helping to fill the income gap and reduce your reliance on market-based withdrawals.

By combining these two reliable income sources, you create a more stable and predictable foundation in retirement. This dual-income strategy helps cover everyday expenses, absorb unexpected costs, and gives you greater peace of mind—knowing your core income is secure no matter how long you live or what the market does.
Flexibility in Timing

One of the key advantages of combining Social Security with annuities is the flexibility in when you begin receiving income. You have the ability to choose the optimal time to start both—allowing you to tailor your income strategy around your lifestyle, goals, and tax situation.

Many retirees choose to delay Social Security to increase their monthly benefit, while using a fixed or lifetime income annuity to generate reliable income in the early years of retirement. This strategy helps maximize Social Security payouts while still ensuring you have steady, guaranteed income from the start—providing both financial flexibility and long-term peace of mind.
Addressing Longevity Risk

One of the biggest concerns in retirement is the risk of outliving your money. By combining Social Security with a lifetime income annuity, you create a powerful safety net that helps eliminate this fear.

Social Security provides guaranteed income for life, and a lifetime annuity does the same—ensuring you continue to receive monthly payments even if your personal savings run out. With both working together, you’re far less vulnerable to market downturns, poor investment returns, or simply living longer than expected. It’s a smart way to build lasting financial security and enjoy retirement with confidence.
Diversifying Income Sources

Relying solely on Social Security may cover basic needs, but it often falls short of supporting a truly comfortable retirement. By adding a fixed or lifetime annuity, you create an additional, guaranteed income stream—one that’s insulated from market volatility.

This diversification reduces your dependence on investments and helps cushion your income during times of economic uncertainty. When markets fluctuate or the economy takes a hit, having both Social Security and annuity income ensures greater financial stability—so you can focus on enjoying retirement, not worrying about what the market is doing.
Filling Gaps in Retirement Income

Annuities offer valuable flexibility when it comes to filling income gaps in retirement—especially if you’re still deciding when to claim Social Security. Depending on your needs, you can choose to start one income stream early while delaying the other to maximize growth.

For example, you might begin Social Security earlier while allowing your annuity to defer and grow—leading to higher guaranteed payouts down the road. In other cases, delaying Social Security may result in a larger benefit, while your annuity provides income in the meantime. This strategic timing allows you to optimize both sources, ensuring you meet short-term needs without sacrificing long-term income potential.
Creating a Balanced Plan

A well-rounded retirement plan starts with understanding how much guaranteed income you need to cover essential expenses like housing, healthcare, and day-to-day living. Social Security may cover part of that, but often not all. That’s where a lifetime income annuity can help fill the gap—providing predictable income for as long as you live.

By working with an experienced advisor, you can determine the right mix of guaranteed income sources tailored to your personal needs and goals. This balanced approach offers both security and flexibility, helping you confidently cover your essentials while preserving other assets for lifestyle or legacy planning.

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Close the Retirement Income Gap with Confidence

Relying on Social Security alone may leave a shortfall in retirement—what we call the income gap. By combining Social Security with the guaranteed income of a fixed annuity, you can create a dependable foundation that covers essential expenses and protects against market uncertainty. At Diversified Insurance Brokers, we help you build a balanced, risk-managed income plan designed to last a lifetime.

Ready to close the gap and retire with confidence? Contact us today to explore a strategy tailored to your goals.

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