Displaying items by tag: annuities

Wednesday, 07 July 2021 18:03

Why Annuities are the Product of the Future

(New York)

Something very interesting is happening in the annuities market: a new generation is taking the lead. While for many advisors, getting Baby Boomers into annuities as they near retirement has been the focus, a new generation—Gen X—has been turning to the product because of a lack of pensions. According to a new industry study “investors under 55 are considerably more interested in annuities than Baby Boomers; 58% embrace the product as an alternative to pensions”. According to Jean Statler, CEO of the Alliance for Lifetime Income, “The high level of interest in annuities and protection among younger investors is extraordinary … Unfortunately, there’s still a large gap between what investors say is important to them and what financial professionals think is important”.


FINSUM: This makes a lot of sense. The generations younger than Boomers have experienced more income insecurity and retirement uncertainty and are more focused on their ability to control their own retirement income.

Published in Wealth Management
Wednesday, 05 May 2021 06:41

The Best Annuities Rates in 2021

(New York)

The last year has been rough for annuities rates. The big drop in yields once the pandemic took hold meant annuities providers had to quickly and sharply cut their rates. But at the same time, the need for annuities has never been higher, given volatility and increased rates of retirement as Baby Boomers age. So where can one find the best annuities? Check out Fidelity, Allianz, New York Life, USAA, and MassMutual. For example, Allianz has no annual fees on their fixed index annuities. New York Life offers some very strong variable annuity options, including the ability to withdraw 10% of the account without penalty, and a minimum account value of only $2,500.


FINSUM: More and more advisors are moving into annuities as client need is rising. This has led to innovation in the space (such as no-commission annuities for RIAs) as well as more product creativity.

Published in Wealth Management
Wednesday, 28 April 2021 17:34

Commission-free Annuities are Here to Stay

(New York)

The annuities business has long been “plagued’ by commissions. High fees paid out to sales people had a multi-part effect that hurt the industry’s reputation. On the one hand it made the products look less competitive, and on the other it led to some bad behaviors among brokers. However, as the industry has been changing, so have the fees structures, with commission-free annuities now an important fixture of the market.


FINSUM: DPL Financial specializes in providing commission free annuities from top providers so that RIAs can now sell annuities.

Published in Wealth Management
Friday, 23 April 2021 15:31

Why This is the Perfect Time for Annuities

(New York)

There are a number of forces propelling annuities forward at the moment. Not only is their component of tax deferral getting more and more valuable given the new administration’s tax plans, but the need and desire to lock-in guaranteed income has grown over the last year. The single biggest force, however, is the US demographic trend. An astonishing 10,000 people per day are turning 65, and 16.5% of the population is now 65 or older. By 2030 all Baby Boomers will be over 65. That means this gigantic cohort is moving out of their wealth accumulating years and into their drawdown years. Many need guaranteed income.


FINSUM: A lot of advisors have an automatically negative reaction to annuities, but the market has improved a great deal in recent years, and for any clients they are a good option.

Published in Wealth Management
Wednesday, 21 April 2021 19:31

Why Annuities are Getting More Valuable in 2021

(New York)

Not a lot of people think about the tax benefits of annuities. This is partly because 401(k)s are also a key retirement product and get most of the “tax-deferred” attention, and partly because annuities just aren’t all that well understood. But what they allow is the tax-free accumulation of interest and gains over time. This feature is growing increasingly popular, especially this year, as tax rates look likely to rise under the new administration/Congress.


FINSUM: This is just one of several reason why annuities are being seen as more valuable, but it is certainly a good one as taxes even on middle class Americans looks likely to rise.

Published in Wealth Management
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