"Harry Ito is about to retire. He plans to sell his business sometime in the next five years and is considering using the $100,000 proceeds from the sale to purchase an annuity.

1. Under what set of circumstances would the annuity be desirable?

2. If an annuity is purchased, what features should it have with respect to guarantees?

3. If Mr. Ito doesn't purchase an annuity, what alternative uses of the $100,000 could provide him with a life income in retirement?"

Answer rating: 100% (QA)

1 An annuity might be desirable for Harry Ito if he seeks a steady guarant... View the full answer