Most retirees want two things at the same time: steady income they can’t outlive and the freedom to keep some money liquid.

An annuity ladder can do both.

It turns part of your savings into scheduled “pay raises” later in life — without relying on the stock market.

Why One Big Annuity Can Feel Risky

Many retirees like the idea of guaranteed income, but hesitate to buy one large annuity. It can feel like an all-or-nothing decision. Once the money is locked up, it’s hard to change course.

That’s where an annuity ladder comes in. Instead of buying one big contract, you split a portion of savings into smaller annuities that start paying at different ages.

Think of it like creating your own pension in stages.

A ladder might have payments begin at 65, 70, 75, and 80. Each stage turns on like a new paycheck. And each one boosts your income right when retirement often gets more expensive.

One advisor explained it this way: “It’s guaranteed income, but with flexibility and timing built in.”

How an Annuity Ladder Creates Lifetime Raises

The ladder strategy works because spending patterns change as retirees age. Early retirement may include travel and hobbies, but later years often include more healthcare costs and higher daily support needs.

By staggering annuity start dates, you create income boosts right when you may need them most.

At 65, the first annuity can help cover basic bills. At 70, the next one adds extra monthly breathing room. At 75 and 80, new income streams turn on again, acting like scheduled raises that never stop.

This helps fight inflation in a simple way. Even if prices rise, your income rises too — not by guesswork, but by design.

The other advantage is that you don’t have to annuitize everything. Many retirees allocate only a portion of savings, often 20% to 40%, to cover essential expenses. The rest stays invested for growth or kept liquid for emergencies and family needs.

That balance is what makes the ladder attractive. You secure your “must-pay” expenses with guaranteed income, while keeping flexibility for the rest of your life.

Retirees also like the emotional relief. When essential bills are covered for life, market volatility becomes far less scary. You can stay invested without panic because you’re not depending on stocks for groceries and utilities.

Annuity ladders won’t fit every retiree, and they require careful shopping and planning. But the concept is powerful: instead of hoping your investments cover you forever, you build a structured income system that strengthens over time.

It’s not an all-or-nothing bet. It’s a step-by-step retirement paycheck plan.