What Is Lifetime Income Insurance Worth?

A Guaranteed Lifetime Withdrawal Benefit (GLWB) could be just what you need when markets are down and you’re worried about future income.

A worried female investor studies her laptop.
(Image credit: Getty Images)

Imagine that you decided to retire at the end of 2021 and were planning on spending $25,000 each year from a $500,000 balanced portfolio of stocks and bonds. Before this year, you would have had about an 80% chance of being able to fund 30 years of income. Fast-forward to today, when your portfolio is down 20% or more, would you still feel comfortable spending $25,000?

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David Blanchett, PhD, CFA, CFP®
Head of Retirement Research, PGIM

David Blanchett, PhD, CFA, CFP®, is Managing Director and Head of Retirement Research for PGIM DC Solutions. PGIM is the global investment management business of Prudential Financial, Inc. In this role he develops research and innovative solutions to help improve retirement outcomes for investors with a focus on defined contribution plans. Prior to joining PGIM he was the Head of Retirement Research for Morningstar Investment Management. He is currently an Adjunct Professor of Wealth Management at The American College of Financial Services and Research Fellow for the Alliance for Lifetime Income. David has published over 100 papers in a variety of industry and academic journals that have received awards from the CFP Board, the Financial Analysts Journal, the Journal of Financial Planning, and the International Centre for Pension Management. In 2014 InvestmentNews included him in their inaugural 40 under 40 list as a “visionary” for the financial planning industry, and in 2021 ThinkAdvisor included him in the IA25+. When David isn’t working, he’s probably out for a jog, playing with his four kids, or rooting for the Kentucky Wildcats.

With contributions from