Should I buy an annuity at age 65?

Age 65 is one of the most common ages for purchasing annuities because it aligns with the transition from accumulation to income distribution. Whether an annuity is appropriate depends on your specific situation — your income needs, other assets, risk tolerance, and goals. AG Insurance can help you evaluate whether an annuity makes sense for your retirement plan.

How much of my savings should I put in an annuity at 65?

There is no universal answer. A common approach is to cover essential monthly expenses with guaranteed income sources (Social Security + annuity income) and keep the remainder in market investments for growth and discretionary spending. AG Insurance can help you calculate how much annuity income you need and what premium is required to generate it.

What is the best annuity for a 65-year-old?

The best annuity depends on your goals. If you need income now, a single premium immediate annuity (SPIA) may be best. If you want to protect savings and create future income, a fixed indexed annuity with an income rider is often a good fit. If you want simplicity and a guaranteed rate, a multi-year guaranteed annuity (MYGA) may be appropriate. AG Insurance compares options from multiple carriers to find the best fit.

Do I have to take Medicare at 65?

Medicare Part A (hospital insurance) is generally free and most people enroll at 65. Medicare Part B (medical insurance) has a premium and you can delay enrollment if you have qualifying employer coverage. For Medicare plan selection help, see our Turning 65 Medicare guide.

AG Insurance Guide

Turning 65 — A Complete Retirement Income and Financial Planning Guide

Turning 65 is one of the most significant financial milestones in life. It marks the beginning of Medicare eligibility, the typical start of retirement income planning, and often the point at which protecting accumulated savings becomes as important as growing them. This guide covers the key financial decisions you face at 65 — beyond Medicare — including how to create guaranteed income, protect your savings, and make smart decisions about annuities.

The Financial Shift at Age 65

For most people, the financial priorities at 65 are fundamentally different from those at 45. At 45, the primary goal is accumulation — growing retirement savings through market investments. At 65, the primary goals shift to protection and income — protecting what you have built from market risk and converting savings into reliable income. This shift requires different financial tools. Annuities, which are often not appropriate during the accumulation years, become highly relevant at and around age 65.

Social Security Timing Decisions

One of the most important financial decisions at 65 is when to begin Social Security. You can begin as early as 62 (with a permanent reduction), at your full retirement age (66–67 depending on birth year), or as late as 70 (with an 8% annual increase for each year of delay beyond full retirement age). Delaying Social Security to age 70 provides the highest guaranteed lifetime income — effectively a risk-free 8% annual return on the delayed benefit. If you can cover expenses from other sources until 70, delaying Social Security is often the most financially sound decision.

Protecting Your Retirement Savings from Market Risk

The sequence of returns risk — the danger of a major market decline early in retirement — is one of the most significant threats to retirement security. A 30% market decline in the first two years of retirement can permanently damage a portfolio's ability to sustain withdrawals, even if markets recover strongly afterward. Protecting a portion of your savings in fixed or indexed annuities eliminates this risk for that portion, providing a stable foundation for retirement income regardless of market conditions.

Creating Guaranteed Retirement Income

Social Security provides a guaranteed income foundation, but for most people it is not sufficient to cover all retirement expenses. The gap between Social Security income and total expenses needs to be filled from savings. Annuities are the only financial product that can guarantee income for as long as you live — eliminating the risk of outliving your savings. At 65, evaluating how much guaranteed income you need beyond Social Security and whether an annuity can fill that gap is a critical planning step.

Evaluating Your 401(k) and IRA Options

At 65, you face decisions about your 401(k) and IRA savings. You can leave them invested in the market, begin systematic withdrawals, or roll a portion into an annuity IRA to create guaranteed income. Required minimum distributions (RMDs) begin at age 73, so you have time to plan. Many people at 65 choose to roll a portion of their 401(k) or IRA into a fixed indexed annuity to protect it from market risk while maintaining growth potential through index participation.

The Role of Fixed and Indexed Annuities at 65

Fixed annuities at 65 provide a guaranteed rate of return for 3–7 years, making them ideal for money you want to protect and grow without market risk. Fixed indexed annuities provide principal protection with growth potential linked to a market index, plus income rider options that allow you to create guaranteed lifetime income in the future. Many people at 65 use a combination — a fixed annuity for near-term savings and an indexed annuity with an income rider for longer-term income planning.

Working with AG Insurance at 65

AG Insurance & Financial Solutions serves clients turning 65 throughout West Virginia, southern Ohio, and eastern Kentucky. We help clients evaluate Social Security timing, Medicare options, annuity products, and overall retirement income strategies. Our consultations are free, our advice is independent (we are not tied to any single insurance company), and we are licensed in West Virginia, Ohio, and Kentucky. We meet with clients in person at our Huntington WV office or by phone.

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