WASHINGTON, Oct 24 (Reuters) – The U.S. Treasury Department said on Friday it was tweaking its policy for retirement funds to encourage savers to buy annuities, a measure aimed to keep them from outliving their savings.

The department and the Internal Revenue Service will let retirement funds offer long-term deferred annuities as a default investment in 401(k) retirement accounts. The guidance builds on the tax break the Treasury announced in July for retirement savers who want to buy the annuities.

For people saving for retirement, purchasing an annuity is a tool for locking in a steady outcome in case they live longer than they plan.

“By encouraging the use of income annuities, today’s guidance can help retirees protect themselves from outliving their savings,” J. Mark Iwry, Treasury deputy assistant secretary for retirement and health policy, said in a statement. (Reporting by Jason Lange; Editing by Chizu Nomiyama)