Eric Henderson, the president of Nationwide Financial’s annuity division, recently shared some thoughts on annuities and how it can help reduce financial stress for retirees. Henderson has been with the company for nearly 40 years and been instrumental in helping Nationwide’s annuity business grow to over $100 billion in assets. 

He believes that this is a great time for annuities given that short-term rates are above 5% in many instances. It’s been benefiting from volatility in fixed income and equities in addition to a cascade of uncertainties including inflation, monetary policy, recession risk, geopolitics, etc. 

Annuities can help investors side-step these risks while also taking advantage of historically high rates. So far, fixed annuities have seen the biggest increase in sales, but there has been strength in other types of annuities as interest and awareness grows.  

In terms of trends, Feldman sees more shorter-term, annuity products being introduced given the combination of uncertainty and increasing demand. Additionally, he sees the potential for ‘customized’ annuities that are created to fit an individual’s specific needs.   

Overall, he believes that at some point investors evolve from a ‘wealth accumulation mindset’ to focusing more on maximizing income. He believes this is the best time in decades for investors to build healthy income streams, and it also provides needed diversification given a shaky economic outlook. 

Finsum: Nationwide’s head of annuities, Eric Henderson, shared his thoughts on the category’s increase in popularity and some interesting trends.