The Big Picture report for the Smiths shows withdrawals from assets stopping, but guaranteed income lasting through the end of life. What is the resulting retirement outcome described?

• A. A deficit in retirement because the income alone is not enough
• B. A surplus due to guaranteed income
• C. No change in retirement funding
• D. The plan is fully funded

Answer: (A)

The main idea is how the mix of income sources affects retirement funding. When withdrawals from assets stop, you lose a source of funds that helped cover living costs. If guaranteed income lasts through the end of life but isn’t enough to cover all expenses, there’s still a shortfall each year. So, even with a longevity-protected guaranteed income, the plan would run a deficit because the income alone doesn’t fully meet the expected spending needs once asset withdrawals cease. In practice, you’d need higher guaranteed income, lower expenses, or continued asset withdrawals to avoid the shortfall.