Over the past 40 years, Carl’s employer-funded defined contribution retirement program has been invested in a variable annuity. Now that he has reached retirement age, he is elated that the value of the accumulation exceeds $1 million. He anticipates the investment income on the accumulation will be between 7 and 8 percent annually. Because this amount is sufficient for his and his wife’s needs, he looks forward to leaving his two children approximately half a million dollars each.

Advise him.