New research suggests retirees who turn their savings into guaranteed monthly income may actually live longer.  A working paper from the National Bureau of Economic Research (NBER) found that retirees who choose annuities are less likely to die over a 10-year period than those who manage withdrawals on their own. The study looked at roughly 600,000 retirees in Chile, where workers must decide how to convert savings into income at retirement.

Why income stability matters

Researchers point to financial stress as a key factor. Retirees relying on market withdrawals face uncertainty—especially during downturns—about whether their savings will last. Annuities, on the other hand, provide predictable income, which may reduce anxiety and improve overall well-being.  There’s also a behavioral angle: people with steady income may be more likely to spend on healthcare, nutrition, and other essentials that support longevity.

Lessons for U.S. retirees

While Chile’s system is unique, the takeaway is universal: reliable income in retirement matters. In the U.S., where pensions are rare, many retirees must create their own “paycheck” using Social Security and personal savings.  Annuities aren’t for everyone—they limit flexibility and can be impacted by inflation. But some financial planners recommend using them to cover essential expenses, creating a stable financial foundation while keeping other investments for growth.

The bottom line

How you turn savings into income may be just as important as how much you save. Reducing financial uncertainty doesn’t just ease stress—it may even help you live longer.