Most people know that increasing prices for goods and services is called inflation. Since inflation has averaged about 3% for the past 100 years, these reports will calculate the purchasing power of future dollars using a 3% annual rate, and will also calculate the annual internal rate of return (IRR). An IRR of 3% will perform like 0% in the Value in 2026 Dollars column.

Mary, age 73, keeps $500,000 in taxable accounts averaging 4% and spends the $20,000 of interest each year. Principal never grows. Income never grows. 3% inflation reduces what that money will buy every year through age 105.

Joe is single, age 65. He plans to work until age 70 to maximize Social Security. He wants a safe, guaranteed lifetime income and is considering a proposal from a reputable insurance company for a Fixed Index Annuity with a Guaranteed Lifetime Income Rider, rolling over $600,000 of his 401(k) to receive about $5,378 a month at age 70. He is in excellent health, and since his parents lived until their nineties, he worries about outliving his income. He is aware of inflation, but hasn't found a plan that increases income as he gets older. This lifetime income plan is guaranteed at $64,535 per year, but 3% inflation starts eating away at that plan starting on day 1 before income begins.

3% compound inflation is an assumption, not a forecast. Mary's $20,000 and Joe's $64,535 do not increase. This is a concept illustration, not a policy, recommendation, or tax opinion.

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In 1976, annuity products often took a 100% marketing load on the first year's premium and paid 70% commission; general agents and regional managers took more on top of that. Starting in the second year there were no loads or fees, so 100% of the premium began earning for the policyholder. The first-year interest rate was 7.75%, and the rate was guaranteed never to fall below 4.00%.

Today, 100% of the premium is credited to the policyholder immediately. The most common form of this traditional annuity is a Multi-Year Guaranteed Annuity (MYGA): a declared interest rate, guaranteed for a set term, generally 3 to 10 years.

Typically an independent agent earns 3% of premium; marketing organizations take another 1% to 2%. On a $500,000 MYGA that is $15,000 to the agent plus $10,000 to the marketing organization. Who pays this $25,000? You do. Not as a line-item fee, but as a lower interest rate than you would have earned without those commissions. Here is a concrete example.

Current interest rates on a $500,000 7-year MYGA. Company P is Puritan Life, live from their MYGA rate file. Companies A, E, and C are the last published 7-year rates for commission products (those feeds come next):

The first three companies pay 3.00% commission to agents recruited by marketing companies. The fourth markets on the Internet and uses salaried, insurance-licensed employees to answer questions, discuss financial needs, explain suitability rules, and help customers complete paperwork.

Here is how much a $500,000 7-year MYGA is guaranteed to grow in seven years:

Company P is Puritan Life Insurance Company of America, which offers true no-load annuities. Lower expenses mean higher interest rates for their customers. Simple math. Common sense.

Company P (Puritan Life) 7-year MYGA is live from the Canvas rate file. Companies A, E, and C are last-published 7-year rates until those company feeds are connected. Values assume $500,000 compounds at the stated rate for 7 years. This is a concept illustration, not a policy, recommendation, or tax opinion.

For fifty years the stock market has looked, from a distance, like a staircase up. Up close it is a series of bubbles, bursts, and long waits to get even. People who are still working can often wait. People who need that money for rent, food, and a lifetime of income cannot. A crash does not ask whether you have time.

The 1970s were a lost decade for many investors. After the 1973-74 bear market, stocks spent years going nowhere in real terms while inflation ate the paycheck. Then the 1980s boomed. From 1982 into 1987, prices ran so far, so fast, that Black Monday -- October 19, 1987 -- knocked the Dow about 23% in a single day. The market recovered. The lesson did not: gains can vanish faster than they arrived.

The 1990s surged again, this time on technology. The dot-com peak in 2000 was followed by a crash through 2002. The NASDAQ fell about 78% peak to trough. The S&P 500 was cut roughly in half. Then prices rose into the mid-2000s -- until housing, banks, and leverage produced the crash of 2008. The S&P 500 dropped about 57% from October 2007 to March 2009. Retirement accounts that were “at risk” became a smaller number on a statement, in the years people could least afford it.

There have been more corrections since: the 2020 COVID drop of about 34% in weeks, and the 2022 bear of about 25%. Each time the market eventually made new highs. Each time, someone who had to sell near the bottom locked in the loss.

Approximate peak-to-trough declines. These are history, not a forecast.

Are we due for another correction? Nobody knows the date. Valuations can stay high longer than a cautious person can stay comfortable. What we do know is the pattern: long climbs, sudden air pockets, and a recovery that helps only those who did not have to sell. If this next decade is kind, extra stock market return is a bonus. If it is not, a 401(k) that is still fully “at risk” can cut the income you were counting on for life.

Can you take that chance with money you cannot replace? Many people are choosing not to. They are rolling a slice of those “at risk” 401(k) assets into safe, guaranteed, high-interest cash and lifetime income -- Barrel 1 a MYGA, Barrel 2 a SPIA -- the Double Barrel Annuity approach. The market can bubble. That income does not have to.

Index declines are approximate peak-to-trough figures from widely reported market history. They are not a prediction of the next decline, a recommendation to buy or sell securities, or a guarantee of future annuity results. This is a concept illustration, not a policy, recommendation, or tax opinion.

Interest rates are not a law of nature. They drift, they jump, and they can stay in one place long enough that people forget they move. Anyone who has lived through the last forty years has seen both extremes: annuity rates near 15%, and years when cash paid almost nothing.

In 1982 a buyer could still lock in a fixed annuity at about 15%. Inflation was being broken, the Federal Reserve had pushed short-term rates into the double digits, and a buyer who locked in that contract looked, for a while, like a genius. Then rates began a long decline. Through the 1990s, the 2000s, and the 2010s, CD, money-market, and Treasury yields ground lower. After 2008, policy rates sat near zero for years. In 2020 the 10-year Treasury yield briefly traded under 1%. People who waited for “normal” rates waited a generation.

Approximate levels -- a mix of a 1982 annuity rate, later 10-year Treasury yields, and today's Puritan Life 10-year MYGA (live from the rate file). These are landmarks, not a quote of every product.

Will rates stay here, go back toward 15%, or fade toward nothing again? Nobody knows. The Federal Reserve can cut. Inflation can return. A 6% guarantee can look rich in five years, or cheap. Waiting for a perfect number is a bet on a future you do not control. The cost of being wrong is not theoretical: if you stay in short-term cash and rates fall, the income you could have locked in is gone.

That is why people now choose to lock in. A MYGA credits a declared rate, guaranteed for a set term -- generally 3 to 10 years. If rates fall during that term, the contract does not reprice. If they rise, the next renewal is a new decision. A SPIA does something the MYGA cannot: it turns today's higher interest rates into a paycheck for life. The insurer prices that income off current rates. Once issued, a life-only SPIA does not cut the check because the 10-year Treasury later yields 2%. Thirty years of income can rest on a rate that existed on one afternoon in 2026.

Barrel 1 holds the cash at a guaranteed MYGA rate. Barrel 2 spends a slice of that world -- high rates inside the SPIA -- on income that can last 30 years or more. You do not have to guess the next Fed meeting. You have to decide whether this rate, on this day, is one you can live with if the next decade is nothing like the last.

Historical rates are landmarks. The 2026 MYGA figure is the current Puritan Life 10-year Canvas Future Fund rate, live from the MYGA endpoint. It is not a forecast. MYGA and SPIA guarantees depend on the claims-paying ability of the issuing insurer. This is a concept illustration, not a policy, recommendation, or tax opinion.