Are DIAs the perfect annuity for baby boomers?

Kimberly Foss calls them “tweeners.” But, no, she’s not referring to those legions of pre-teens who worship Justin Bieber. Instead of the baggy-pants one, Foss, CFP®, founder and president of Empyrion Wealth Management in Roseville, Calif., is talking about baby boomers, mostly in their 50s, who have been displaced from their jobs and are possibly entering a second career. At the same time, they are also contemplating retirement and how they will fund their golden years. “But they don’t have quite enough money for full retirement so they are looking for a way to get a guaranteed income but not take it right now,” Foss says.

Enter the latest hot product in the annuity world, the deferred income annuity, or DIA. In simplest terms, a baby boomer can buy a DIA at age 55, but not switch on the income spigot until he or she actually retires in, say, 10 years, or whatever start date a purchaser may choose.