What Is a Good Monthly Retirement Income for a Couple?

What is a good monthly retirement income for a couple? The answer is not a national average, a rule of thumb, or something you saw on cable news. It starts with defining your income floor.

Chapter two is about you. Before you talk about investments or annuities, you and your spouse need to sit down and determine what monthly income is required to pay the bills without worrying about market headlines or what is happening on Wall Street.

Key Takeaways

A good retirement income starts with defining your income floor
Social Security, pensions, and RMDs must be included first
If there is no income gap, no additional annuity may be needed
If there is a gap, annuities can contractually fill it
Joint life structures protect the surviving spouse

How Do You Determine a Good Monthly Retirement Income?

You begin by adding up your essential expenses. That becomes your income floor. This is the amount needed every month to live without stress.

Next, you subtract the guaranteed income you already have.

Most couples already own annuity-type income streams:

Social Security
Pensions, if fortunate
Required Minimum Distributions from IRAs
Dividends, rental income, or other recurring sources

Once those are added up, you determine whether there is a gap.

If there is no gap, you are fine. If there is a gap, that is where planning begins.

When Should You Take Social Security?

There is no magic number.

The older you are when you begin taking Social Security, the higher the payment. However, you must factor in the years of payments missed while waiting.

In the transcript, the opinion expressed is to take the money when you need the income. The right timing depends on your situation and your income floor requirements.

What If There Is an Income Gap?

If your guaranteed income sources total $5,000 per month and you need $5,750, then you must solve for the additional $750.

This can be done using a reverse-engineered quote. Instead of asking what a lump sum will produce, you solve for the required monthly income and determine which carrier requires the least amount of money to guarantee that amount.

Annuities are described as commodity products. Quotes change every seven to ten days, and different carriers may price aggressively based on age and life expectancy tables.

Which Annuities Can Fill a Retirement Income Gap?

There are four annuity types that can provide income:

Two primary questions must be answered:

What do you want the money to contractually do?
When do you want the contractual guarantees to start?

Income can begin immediately or later, depending on your needs.

How Should Couples Structure Retirement Income?

For couples, joint life income is generally advised. Joint life means that when one spouse dies, the income continues uninterrupted and unchanged for the surviving spouse.

It can also be structured so that when both spouses pass away, 100 percent of the remaining funds go to beneficiaries and the insurance company does not keep the remainder.

Different payout structures exist, including life-only options, but most couples prefer to protect both the surviving spouse and their beneficiaries.

What About Inflation?

There is no annuity product that solves inflation automatically without reducing the starting payment.

If inflation creates an income shortfall later, you can solve for it at that time by reverse engineering an additional Single Premium Immediate Annuity to fill the gap.

The focus is on contractual guarantees, not projections.

Final Thoughts on Retirement Income for a Couple

A good monthly retirement income for a couple is the amount that covers your income floor without stress.

Start by calculating what you need. Subtract guaranteed income already in place. If there is no gap, no additional action is required. If there is a gap, annuities can be structured to contractually solve it using the least amount of money necessary.

Retirement income planning is about guarantees, clarity, and protection for both spouses.

If you want to determine whether your current income sources are sufficient or whether there is a gap to fill, you can run quotes or schedule a free consultation with The Annuity Man team to evaluate your specific numbers.