Surprisingly (or perhaps not) most Americans have limited liquid financial resources during their retirement years. From the NBER Bulletin on Aging and Health:
“…for many households “discussions of whether to purchase an annuity or draw down wealth in another fashion are largely moot; the amount of retirement support that their savings will provide is very limited. For example, nearly half (43 percent) of households would not be able to make the $25,000 minimum investment typically required to purchase an annuity even if they liquidated all of their financial assets.”
Source:
- James M. Poterba, Steven F. Venti, David A. Wise. The Composition and Draw-down of Wealth in Retirement. NBER Working Paper No. 17536. October 2011