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Live longer and prosper with annuities

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Are you worried about outliving your money in retirement? Here’s another option:

Alert: The IRS has issued final regulations allowing IRA owners and qualified plan participants to acquire “longevity annuities” in their accounts. The purchases won’t be tainted by the rules for required minimum distributions (RMDs).

As a result, you may use a portion of your account assets to provide guaranteed income at an advanced age, like 80 or 85.

Here’s the whole story: Generally, you must begin taking RMDs by April 1 of the year following the year you turn age 70½. If you turned 70½ this year, the distribution for 2014 must occur by April 1, 2015, and then you must take another RMD for 2015 by Dec. 31, 2015. RMDs must continue each succeeding year, based on the account balance at the end of the prior year.

The distributions are taxed at ordinary in­­come rates. Currently, the top tax rate is 39.6%.

There’s an exception to these rules fo...(register to read more)

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