--- title: This Retirement Strategy Could Boost Your Fixed-Income by 23% description: Goldman Sachs says adding an annuity to your portfolio could boost retirement income by 23% using a simple blended strategy. authors: - name: Adam Hardy role: Lead Data Reporter url: https://money.com/author/adam-hardy/ bio: Adam Hardy is a lead data journalist at Money, where he frequently reports on financial barriers that affect low-income Americans. Adam’s work has also appeared in Business Insider, Forbes, Nasdaq, The Penny Hoarder, Yahoo! Finance and more than a dozen local and regional newspapers. education: University of South Florida, BA, Magazine Journalism at_money_since: 2021 articles: 498 covers: - Retirement - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Pets - Professional Services - Shopping - Taxes - Technology also_seen_in: - The Penny Hoarder - Forbes Advisor - Creative Loafing - The New York Times - The Washington Post - Bloomberg - Harvard Law School - The Federal Register - National Consumer Law Center - CBS News - Becker's Hospital Review - Business Insider - Mother Jones - The Week - Fortune - The Philadelphia Inquirer - National Association of Student Financial Aid Administrators (NAFSAA) - Education Advisory Board (EAB) - The Institute for College Access & Success (TICAS) - This Morning with Gordon Deal - Empower - Reddit social: - https://www.x.com/hardyjournalism - https://www.linkedin.com/in/hardyjournalism/ editors: - name: Katherine Peach role: Associate Editor url: https://money.com/author/katherine-peach/ bio: Katherine Peach is an associate editor with a focus on news and email at Money. She didn’t always intend to write about money. She’s a classically trained pianist who dreamed of becoming an archaeologist. However, in 2007 Katherine began working in financial publishing as an editor for Agora Inc. (Apparently, unearthing ideas about improving your personal finances isn’t such a bad career alternative!) Katherine’s writing and editing work has been featured in Investing Daily, Clever, Investor Junkie, The Palm Beach Letter, Truth & Plenty, Independence Monthly, NICHE, AmericanStyle, AntiqueWeek, Millennial Money, Money Done Right, TheStreet, Sure Dividend and many others. Katherine holds a Bachelor of Arts in Ancient Studies with concentrations in Archaeology and Ancient Languages and a minor in Literature from the University of Maryland, Baltimore County. She is a member of Phi Beta Kappa. education: University of Maryland, Baltimore County at_money_since: 2025 articles: 14 covers: - Retirement - Banking - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Federal Reserve Rate Cuts - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Professional Services - Shopping - Taxes published: '2026-09-05T14:45:16.000Z' modified: '2026-09-05T16:00:04.000Z' section: Retirement tags: - News word_count: 740 canonical: https://money.com/annuity-strategy-boosts-retirement-income/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Happy senior couple saving money at home using piggy bank](https://img.money.com/2025/10/News-Insurance-Hack-Boost-Savings.png) As the costs of everyday essentials continue to climb, fewer Americans are finding room in their budgets to save for retirement. A [study](https://am.gs.com/cms-assets/gsam-app/documents/insights/en/2025/am-retirement-survey-102025.pdf?view=true) from Goldman Sachs uses that reality as its baseline and offers up several research-backed methods for Americans to stretch their retirement dollars. The report found one underutilized insurance strategy, in particular, could boost retirement income by 23%. “Does the retirement math still work? The answer is no,” Greg Wilson, the head of retirement at Goldman Sachs, said on a press call last week. “Telling workers just to save more ignores the realities they face.” Instead, the income-boosting strategy maximizes the nest egg you’ve already built by blending guaranteed annuity payments into your portfolio mix when you’re ready to retire. ***Deal of the Week: [AARP Subscription for Just $15 a Year](https://money.com/pr/q11022f27ca6?data-trk-company=aarp-review&data-trk-imp=true&data-trk-pcu-type=direct_link&data-trk-pcu-uuid=q11022f27ca6&encoded_id=)*** ## Protect your retirement with a Reverse Mortgage ### If you are over 62, a Reverse Mortgage from Longbridge Financial (NMLS# 957935) can help you take care of expenses or even invest in things that will improve your quality of life. Click on your state to learn more. [Learn More](https://money.com/pr/s978d3010185?ap_referrer=%2Fannuity-strategy-boosts-retirement-income%2F) ## How annuities can supercharge your retirement income Annuities are insurance products that guarantee payments for life, or a specific period of time. But not all annuities are the same. In Goldman Sachs’s example, the firm looked at single premium immediate annuities, or SPIAs. You can purchase these types of annuities with an upfront lump-sum payment right before you retire. The insurance company then begins guaranteed payments at the frequency of your choosing for the rest of your life. Goldman Sachs found that the average annual payout among the top annuity providers was 7.1% (though this rate can change based on market conditions, sex and age of the buyer, as well as other factors). In the example, the researchers assumed the purchase of an SPIA using 30% of one’s retirement savings, while following the [typical 4% withdrawal rule](https://money.com/4-rule-retirement-withdrawal-rate-update/) on the remaining 70% of the nest egg. Combining these sources of income increases the withdrawal rate to 4.93% — for a retirement income boost of 23%. For example, if you had $1 million in retirement savings, a regular 4% withdrawal would equate to $40,000 per year. But the blended income strategy with an annuity would net $49,300. | | **Allocation** | **Withdrawal rate** | **Annual income** | | --- | --- | --- | --- | | Annuity | 30% | 7.1% | $21,300 | | Retirement Investments: 401(k), IRA, etc. | 70% | 4% | $28,000 | | Total | 100% | 4.93% (blended) | $49,300 | _*Goldman Sachs analysis of retirement income based on $1 million portfolio; Money.com*_ SPIAs can stretch retirement savings and help optimize retirement income, too, according to Goldman Sachs. Following the 4% withdrawal rule, it would take a typical retirement savings of $1 million to provide a $40,000 annual income. However, with a payout rate of 7.1%, the firm says an annuity can generate that same $40,000 annual income with an investment of just $563,000. This strategy could be particularly useful for those who retired with less savings than they had hoped. “We plan for perfection,” Chris Ceder, senior retirement strategist at Goldman Sachs, said during the call. “But the reality is there's going to be bumps in the road. Where do we build in more cushion?” ***Gold Offer: [Sign up with American Hartford Gold today and get a free investor kit, plus receive up to $20,000 in free silver on qualifying purchases](https://money.com/pr/u3ef79664b8e)*** ## Annuities remain underutilized Despite some of the perks, few retirees are invested in annuities. According to the Center for Retirement Research at Boston College, [just 10%](https://crr.bc.edu/do-financial-professionals-recommend-annuities/) of older Americans own any retail annuity, let alone a single premium immediate annuity for the sake of maximizing their retirement income. In theory, many Americans are interested in buying an annuity. Boston College found that 54% of respondents who had at least $100,000 in savings wanted to own “a financial product that guarantees a certain amount of income for life.” The word "annuity," it seems, is a turn-off for many. Some find annuities too complicated, and others don’t like the downsides. To be clear, there are downsides. ***Extra Money: [See how you can get up to $1,000 in stock when you fund a new active SoFi invest account](https://money.com/pr/x00f9061e638)*** For one, annuities aren’t liquid. Once you purchase an annuity, the money you receive comes from a series of payments, and you can’t withdraw from the investment as you would with a bank account. Some annuity products come with steep fees, which can be higher than those of retirement accounts. And depending on your contract, payments may stop upon death and aren’t passed down to your loved ones. “Further, even if individuals are interested in annuities, they might not know how to buy them,” the Boston College report states. Many large banks and financial firms offer annuities, and some can even be funded through [a 401(k) or IRA rollover](https://money.com/what-is-a-401k-rollover/). According to [J.D. Power](https://www.jdpower.com/business/press-releases/2024-us-individual-annuity-study), customers are most satisfied with annuities from USAA, Pacific Life and New York Life. *Editor's note: Money originally published this article on October 9, 2025.* ## With a Reverse Mortgage, you can invest in your future starting today ### Work with a licensed Finance of America (NMLS# 2285) representative today. [Learn More](https://money.com/pr/t879fd448b2c?ap_referrer=%2Fannuity-strategy-boosts-retirement-income%2F) ![](https://s3.consumersadvocate.org/prd/image/image/39553/medium_d01d803f-1110-4310-8997-bada342c27e4.webp) Get the most out of your Reverse Mortgage with Finance of America (NMLS# 2285) [Learn More](https://money.com/pr/ed1a928f8683?ap_referrer=%2Fannuity-strategy-boosts-retirement-income%2F) ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/annuity-strategy-boosts-retirement-income/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Retirement", "item": "https://money.com/retirement/" }, { "@type": "ListItem", "position": 3, "name": "Annuity", "item": "https://money.com/annuity/" }, { "@type": "ListItem", "position": 4, "name": "This Retirement Strategy Could Boost Your Fixed-Income by 23%" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/annuity-strategy-boosts-retirement-income/#webpage", "url": "https://money.com/annuity-strategy-boosts-retirement-income/", "name": "This Retirement Strategy Could Boost Your Fixed-Income by 23%", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2026-09-05T14:45:16.000Z", "mainEntity": { "@id": "https://money.com/annuity-strategy-boosts-retirement-income/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/annuity-strategy-boosts-retirement-income/#breadcrumb" }, "dateModified": "2026-09-05T16:00:04.000Z" }, { "@type": "NewsArticle", "headline": "This Retirement Strategy Could Boost Your Fixed-Income by 23%", "articleSection": "Retirement", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2025/10/News-Insurance-Hack-Boost-Savings.png", "width": 1067, "height": 711, "caption": "News-Insurance-Hack-Boost-Savings" } ], "author": [ { "@type": "Person", "name": "Adam Hardy", "url": "https://money.com/author/adam-hardy/", "@id": "https://money.com/author/adam-hardy/#author", "description": "Adam Hardy is a lead data journalist at Money, where he frequently reports on financial barriers that affect low-income Americans. 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