There are main advantages of Retirement Income Funds:
1. High Liquidity
You can sell your shares at any time if you need emergency cash and to pass on your shares and income payouts to your beneficiaries if you die. This is better than annuities which typically can't be liquidated without paying hefty surrender charges and whose guaranteed payouts can cease if you pass away.
2. Low Expenses
These funds typically charge annual expense ratios as low as 0.34% and require little initial investments to start with. In contrast, a financial advisor might charge you 1% of your managed assets each year to oversee your portfolio and set up an income stream.
In next blog post, we will look at the disadvantages of retirement income funds.