WORRIED ABOUT OULIVING YOUR MONEY?

annuity product that guarantees you an income and promises to pay until you

die---no matter what.

Most retirees know that retirement living isn't exactly living on the

cheap. Sure, many have paid off their homes, but there are still real

estate taxes and insurance premiums and month-to-month expenses.

Add the fact that most people are living much longer then the generation

before them, and it's easy to see why having enough money to live on

becomes a big concern for those in their golden years.

In an effort to provide investors with a monthly income that's guaranteed

to be there for as long as they live, T Rowe Price has recently introduced

an immediate variable annuity called The Income Account,

(800-469-5304).

"All the studies have shown that the No.1 concern people have in retirement

is outliving their assets and here's a product that's been designed to meet

that concern, " says Steven Norwitz, vice president at T.Rowe Price

Associates.

Norwitz explains that unlike regular tax-deferred variable annuities in

which contract owners have to annuitize to get an income stream, this

immediate variable annuity starts providing an income within a month of

opening the account. Thus, it can provide investors with an income that

supplements what they are receiving from other retirement sources such as

their pension or Social Security.

In a nutshell, here are some of the features of T. Rowe Price's immediate

variable annuity Income Account:

Minimum investment. $25,000.

Investment choices. You can invest into can into any one, or any

combination of, these T.Rowe Price funds: New America Growth, International

Stock, Mid-Cap Growth, Equity Income, Personal Strategy Balanced; or

Limited-Term Bond fund.

Monthly income. Because this is an immediate variable annuity, each

month you'll get a fixed monthly payment. Payments are reset every 12

months based upon the performance of your investments.

Guarantees. Monthly income is guaranteed for life, and, guaranteed at

80 percent of your initial monthly payment. That means, if you're 65 years

old today, ( maximum age for investing is 85), invest $50,000 into the most

aggressive stock fund available, (the New America Growth fund), live to be

110 and the stock market is in the tank for the majority of those years,

even though the value of your account hasn't grown, the insurance side of

this investment guarantees that you'll still get a monthly income check

that's no less than 80 percent of your original monthly pay out. (Provided,

of course, you didn't make any withdrawals from the account during the

first five years of ownership which would alter that guaranteed pay-out

amount.)

Then again, if that same 65-year lives to be 110, invests the same amount

of money into that same fund and it's performance soars throughout the

years, monthly income checks can increase.

Sweet as that may sound, there are always downsides to any investment

product. Here are a couple:

Costs. Because this is a mutual fund and an insurance product, there are

annual fees and expenses on both sides. The average fees and expenses for

the fund expenses are estimated at 0.87 percent per year. Mortality and

expense charges, paid to Security Benefit Life Insurance Company

underwriters of the product, are 1.40 percent. That's about 2.3 percent

per year in annual fees and expenses.

First year monthly payments. Insurance companies have a special kind of

wizardry when it comes to calculating things. Figuring out how much your

monthly checks will be during that first and very important year ( as this

year forms a base for future calculations) is based on a combination of

things including life expectancy, gender and an assumed interest rate.

Death benefits. Don't count on passing any bucks on to anyone special.

Death benefits here don't ever amount to more than the current balances of

what's in your account at best. And, they don't exist if you've owned the

account after 15 years.

There is lots more to this product. And, for those who want the comfort of

knowing that they'll have an income stream for life, it represents one

option.