Inflation is one of the risks of immediate annuities which guarantee a fixed payout for life. This WSJ article reviews this issue and some options:
Some annuities will raise the payout based on changes in the CPI while others offer contracts where the payout is increased by a fixed amount -- such as 2% or 3% -- every year for life. Some companies offer both options.
Ken Tumin5,441 posts since Nov 29, 2009 Rep Points: 123,675