Final answer:
For Becky, concerned about inflation affecting her retirement plan, a Variable Annuity or an Indexed Annuity would be fitting as they offer growth potential that can offset inflation effects, but come with higher risks and fees compared to fixed annuities. Option b.
Step-by-step explanation:
Considering Becky's concern about how inflation would affect her retirement plan, the best option for her needs could be a Variable Annuity or an Indexed Annuity. Unlike a fixed annuity, which provides a guaranteed payout but can lose real value due to inflation, these options offer the potential for growth tied to market performance or specific indices which can help hedge against inflation.
An indexed annuity has a return tied to a market index, offering the potential to earn more if the market does well, while a variable annuity allows for investment in different market securities, which means it could grow more significantly with the market, offering protection against inflation. However, the trade-off with both is a higher level of risk and potential fees.
An Immediate Annuity is not suitable for Becky since it starts paying out immediately and she's currently planning for the future. Considering these factors, Becky should seek professional financial advice to determine which annuity suits her tolerance for risk, given her concerns about inflation.