5 Best Retirement Reads from 2015

2015 continued to be a big year for retirement research and news. From Americans lagging in their savings to Baby Boomers’ confidence in a good retirement plummeting, this years’ studies were a true wake-up call for the need to start preparing for retirement early.

In 2015, CNBC explored reasons why women are still saving and preparing less for retirement, USA Today discussed a shocking study that found that 1/3 of Americans have no retirement savings, and NBC News looked into ways that early Social Security benefits can hurt retirees.

And as retirees and soon-to-be retirees continue to prepare for a stable retirement, Fixed Indexed Annuities (FIAs) remain a good option for those looking to ensure a balanced retirement portfolio. In fact, Financial Advisor Magazine gave an in-depth look into FIAs and their rising popularity.

Here are the top 5 retirement news stories from 2015:

1)  Retiring well? Not most baby boomers

Kelley Holland

“The Insured Retirement Institute survey found that 27 percent of baby boomers are confident they will have enough money to last through their retirement, down from 33 percent a year ago and 37 percent in 2011. Only 6 in 10 boomers report having any retirement savings, down from roughly 8 in 10 in previous surveys.”

Read full story at CNBC.

2) Early Social Security Benefits Claims Hurting Most Retirees: Survey
NBC News
Tom Anderson

“People say they want to wait longer to claim Social Security, but life often gets in the way.

A Nationwide Retirement Institute survey of Americans 50 years and older found that 83 percent of recent retirees started taking their benefits before their full retirement age, receiving 49 percent less than if they would have waited. Among recent retirees, 38 percent said they claimed Social Security benefits because they needed the money, 30 percent because they had health problems and 24 percent claimed after a job loss, Nationwide found.”

Read full story at NBC News.

3) Study: Fixed Indexed Annuities Rise in Popularity

Financial Advisor Magazine

Christopher Robbins

Twenty years after their introduction, fixed indexed annuities continue to grow in popularity among broker-dealers and consumers.

Fixed indexed annuities (FIAs) now make up 10 percent of total broker-dealer annuity sales, according to a new report by the Insured Retirement Institute, and half of broker-dealers expect this share to continue to grow.

FIAs are the third most popular form of annuity, after variable annuities with and without lifetime guarantees, with sales increasing 24 percent over 2014 to $48 billion. Since 2012, FIAs have outsold traditional fixed annuities.”

Read full story at Financial Advisor Magazine.

4) One-third have almost no retirement savings

USA Today

Nanci Hellmich

“Many people are woefully unprepared financially for retirement, and they shouldn’t count on working longer to make up the difference, a new national survey reveals.

Almost a third of workers (28%) say they have less than $1,000 in savings and investments that could be used for retirement, not counting their primary residence or defined benefits plans such as traditional pensions. And 57% say they have less than $25,000, according to a telephone survey of 1,003 workers and 1,001 retirees from the non-profit Employee Benefit Research Institute (EBRI) and Greenwald and Associates. Previous surveys from EBRI and other groups have shown similar savings rates.

Read full story at USA Today.

5) Women lagging in retirement saving: Survey


Shelly Schwartz

“American women save far less for retirement than their male peers, and they invest too conservatively to close the gap, according to a new survey asset management firm BlackRock will release March 5. CNBC was granted exclusive early access to the survey results.

The firm’s Global Investor Pulse Survey of 27,000 investors worldwide, including 4,000 Americans, found 53 percent of working-age American women have started saving for retirement, compared with 65 percent of men.”

Read full story at CNBC.






Posted in Uncategorized | Comments Off on 5 Best Retirement Reads from 2015

Helping You Keep Your Retirement Resolutions

When it comes to saving for retirement, many Americans are falling short. According to a recent study by the Financial Industry Regulatory Authority, more than 40 percent of Americans have no retirement savings. What better time to make a plan and start saving for your future than in the New Year? While many people vow to focus on their health during the New Year, it’s important to get your finances in shape, too.

Here are some of the top tips for keeping your retirement resolutions:






Posted in Uncategorized | Comments Off on Helping You Keep Your Retirement Resolutions

FIAs remained strong in 2015 and will grow in 2016

Over the past several years, Fixed Indexed Annuities (FIAs) have emerged as a top choice for soon-to-be retirees due to their potential for wealth accumulation. With the New Year kicking into gear, there’s no better time to look back at the growth and challenges that FIAs have faced in 2015, and what we might expect for the product and industry in 2016.

LifeHealthPro released the following Q&A with Jim Poolman, Executive Director of the IALC, which focuses on the current state of FIAs and what to expect in the year ahead.

1. Did the industry see an uptick in fixed indexed annuities acceptance and growth in 2015?

Jim Poolman: The industry grew significantly in 2015 as the FIA market continues to become a more mainstream product than it has been in the past. The FIA has become a go-to product for Baby Boomers, who are typically financially conservative by nature and looking to keep their money safe. However, they’re also concerned that they’ll outlive their assets and they’re looking for a guaranteed income stream. That’s why we’re continuing to see sales of FIA products increase, because they can be designed with guaranteed income riders so folks know exactly what they’re going to get, and this product ensures that they won’t outlive their income. At the same time, Millennials are beginning to save for retirement. This group is generally distrustful of the financial markets. They have lived through the recession and perhaps seen parents and grandparents lose a significant portion of their retirement savings through the stock market when they were about to retire. Because FIAs ensure that invested principal is secure, this product is becoming more acceptable to younger folks like Millennials, as well as Gen X and Gen Y, as they plan for retirement.

2. What are the challenges for FIAs going into 2016?

Poolman: I think that FIA’s will continue to become to the “go to” product in the marketplace for Americans when doing their retirement and financial planning.  The pending Department of Labor fiduciary rule could change the landscape in how the product is distributed when using FIA’s for Individual Retirement Accounts or qualified retirement plans covered by ERISA.  We obviously don’t know what the resulting rule will look like, but the industry will respond to the rule accordingly.

3. Is the industry prepared to deal with potential changes?

Jim Poolman: I believe that as an industry, we will come out of this DOL rulemaking process prepared and ready to comply with whatever changes the DOL makes. The FIA industry will be very proactive in making sure we have taken the proper steps to comply with the rule, assuming there are necessary clarifications. The IALC has been very proactive in making thoughtful suggestions to clarify the rule so we can have a clear path to compliance and know exactly what rules we need to play by. We are advocating to keep our distribution in tact so we can give as many choices to consumers as possible.

4. What steps can the industry take to boost FIA sales in 2016?

Poolman: Educating both agents and consumers about the product continues to be an ongoing and necessary opportunity. There are so many competing products in the marketplace and many consumers aren’t aware of our products. Companies also must focus on agent training to ensure that members of the field force who interface with the average citizen know what they’re talking about. Companies need to be responsible for educating their producers about the best uses of our product.

5. What will be areas of focus for the IALC in 2016?

Poolman: Educating consumers is an important part of the IALC’s mission. In the coming year, we will release factual information about FIAs in general, and we’ll educate the media, regulators and public policy makers about the benefits of FIAs. We also plan to do surveys to see how the general marketplace feels about the product specifically, or to gauge attitudes about retirement planning for different market segments. 2015 was an incredibly successful year for the FIA and we see this only improving in 2016. Taking the opportunity to educate people about the product will only better position us for the future.


Posted in Uncategorized | Comments Off on FIAs remained strong in 2015 and will grow in 2016

The Top Three FIA Articles from 2015

2015 was a big year for Fixed Indexed Annuities (FIAs). From FIAs having their highest sales to-date to millennials displaying an increasing interest in the product, consumers are seeing FIAs more and more as a product they can fit into a balanced retirement portfolio.

USA Today noted that millennials are more interested than any age group in the investing strategy behind annuities, as also noted in the study IALC conducted earlier in the year. Bankrate explored ways to ensure that women are equally prepared for retirement as men, noting some of the topics explored in the IALC’s Women’s Panel, and LifeHealthPro took an in-depth look at the truths about FIAs.

Below is a list of the top three FIA articles from 2015:

Millennials want in on annuities

USA Today

“The nation’s youngest batch of retirement savers are more interested than any other age group in the investing strategy behind annuities, even though most of them have likely never heard the word ‘annuity,’ according to a survey just out from the Indexed Annuity Leadership Council…

Fixed-index annuities, a type of annuity that benefits from market gains, have become more popular in recent years as investors wary of stocks sought more stable options. Sales of fixed-index annuities have jumped in the past two years and were up nearly 5% in the first quarter of 2015 compared with the year-ago quarter, according to analytics firm Wink, which surveyed 49 indexed annuity providers.”

Gender inequality for retired women


“A panel presentation, ‘The State of American Retirement — Navigating the Gender Imbalance’ sponsored by the IALC in Washington, D.C., this week addressed the troubling topic…

Jennings said that retirees already may have insurance policies and annuity contracts with provisions for declining health and long-term care needs, and to review those policies to understand coverage.
What’s my takeaway from attending the presentation?

It’s never too soon to stress financial literacy and the importance of a woman planning for and managing her finances, as part of her family and for when she’s on her own. Health care and long-term care are major concerns in retirement and planning is required to meet those needs.”

FIA facts: 10 fixed index annuities truths


“Annuities offer an array of benefits to those nearing or planning for retirement. The biggest advantages is that annuities are an investment vehicle that serves as a complement to other retirement income sources such as Social Security and pension plans, that enable individuals to save a larger amount of cash and defer paying taxes.

And unlike other tax-deferred retirement accounts such 401(k) s and IRAs, annuities do not have an annual contribution limit. All invested money compounds year after year. When an individual wants to cash out of an annuity, he or she can withdraw a lump sum or withdraw in the form of payments for a specific period of time, providing a steady and reliable income stream.”



Posted in In the News, Personal Finance | Comments Off on The Top Three FIA Articles from 2015

Giving the Gift of Security

This is the time of year when we consider what gift we can give to our friends, families and loved ones that they will most appreciate, value and will have a positive impact on their lives. Sometimes this gift is as simple as a card or small trinket. Other times, it is more significant – more long lasting.

As we spend more time with loved ones over the coming weeks, it’s worthwhile to take some time and consider whether the family members and friends who are beginning to prepare for retirement are adequately prepared to step away from their jobs but continue to have financial security.

Today, many Baby Boomers and soon-to-be retirees haven’t taken the steps necessary to position themselves financially to enjoy their golden years. For instance, 54 percent of Americans have never spoken with a financial adviser and nearly two-thirds of those 55 and older said they plan to work past age 67 for financial reasons. However, it’s never too late to consider retirement options and take the necessary steps to prepare.
So, between the turkey, eggnog and caroling, take the time to give the gift of financial security to your loved ones by:

  • Reminding them to make and stick to a budget. Let them know that medical and other factors can increase expenses during retirement.
  • Asking them to consider a diverse financial portfolio. Focusing on a single financial product increases risk. But, options like Fixed Index Annuities (FIA), which can reduce risk by helping protect savings from market turbulence.
  • Having them take advantage of opportunities to boost savings like contributing to a company’s 401(k) or other matching programs.
  • Asking them to consider if they will need an extra source of income even in retirement. FIAs can guarantee income payments for life.

Posted in Uncategorized | Comments Off on Giving the Gift of Security

A Special Note to Women: Part 2

By: Tom Hegna CLU, ChFC, CASL

In my previous post, A Special Note to Women: Part 1, I highlighted Dr. David Babbel’s five significant hurdles that are facing American women and their retirement income. I discussed that while we all face risk with our retirement income, overall, women are subject to more financial risks than men, especially in their later years. Now that we are aware of what the significant hurdles are, how do we approach them?

In his report, Babbel writes that there are three basic ways to invest retirement money:

  • Approach #1: Annuitize a substantial portion of their accumulated wealth.
  • Approach #2: Invest primarily in fixed income instruments such as CDs, bonds, money market funds, etc.
  • Approach #3: Invest primarily in stocks, bonds, and mutual funds.”[1]

A study in the Journal of Personal Finance entitled, “The Effect of Gender and Marital Status on Financial Risk Tolerance,” by Dr. Rui Yao and Dr. Sherman D. Hanna discusses risk tolerance between men and women:

  • Men will be less likely than women to annuitize their wealth at retirement, other things equal.
  • Men are more likely than women to place their funds in risky investments.
  • Women are more likely than men to invest in risk-free securities, such as bank CDs and US Treasury securities, suggesting that women are less risk tolerant than men. (Embrey and Fox, 1997)
  • Single women have a lower propensity to invest in stocks and a higher propensity to invest in bonds than married females, married males, and single males.
  • Men are more likely to allocate their assets to “mostly stocks,” which indicates an appetite for more financial risk. [2]

Although the key findings explain that women are playing it safe by investing in securities like CDs, bonds, money market funds, etc. this is not the optimal way to invest all your retirement money.

We are all well aware of today’s low, or as I call it the “new,” interest rate environment. Since these products do not offer any retirement alpha (i.e. longevity credits, otherwise known as mortality credits) a topic that I highlighted via this blog a few months ago: Increased Life Expectancy Leads to a Decrease in Payout Rates, it will take a much larger portion of your funds to generate the same amount of income.

Annuitizing a significant portion of one’s retirement income can complement a portfolio of stocks and bonds. Fixed Indexed Annuities are an ideal product that can fit here. They can provide a low risk solution, generates guaranteed income for life, and offers protection from market risk. Investing the remainder of retirement savings into a well-diversified portfolio can help provide inflation protection. And by doing this, women can be better protected from the volatility of the market, which could potentially wipe out their entire retirement savings.

For more information on how women can secure more guaranteed lifetime income and achieve retirement success, check out my additional chapter titled, “A Special Note to Women,” in my book, Don’t Worry, Retire Happy! Seven Steps to Retirement Security at:  http://tomhegna.com/


[1] David F. Babbel, “Lifetime Income for Women: A Financial Economist’s Perspective,” Wharton Financial Institutions Center Policy Brief: Personal Finance, July 31, 2008, http://fic.wharton.upenn.edu/fic/Policy%20page/RetirementIncome-Women.pdf

[2] Yao, R. and S. D. Hanna (2005). “The effect of gender and marital status on financial risk tolerance.” Journal of Personal Finance, Vol. 4:1, 66-85.

Posted in Personal Finance, Planning for Retirement | Comments Off on A Special Note to Women: Part 2

A Special Note to Women: Part 1

By: Tom Hegna CLU, ChFC, CASL

While we all face risk with our retirement income, overall, women are subject to more financial risks than men, especially in their later years. Women have several unique challenges, including an average longer lifespan than men.

“The average woman on the planet can expect to live about five years longer than the average man.[1]

Despite the retirement challenges women are facing today, there is a silver lining! There are a number of ways for women to overcome the various financial challenges and achieve the optimal amount of income for their retirement. By identifying the risks, educating themselves about the risks, and learning how to work around or eliminate these risks, women will be able to clear those retirement hurdles with ease. Let’s take a look at five significant hurdles, highlighted by financial economist Dr. David Babbel that impact women’s retirements today.

“Five forces are converging upon Americans today in what some have called the Perfect Storm, and it is about to engulf us from all sides. The situation is particularly precarious for women (…) The best we can do is to organize our own finances in such a way that we can provide for ourselves and our families.”

  • “Decreasing rates of return on their Social Security contributions”
    • averaging 1.8 percent per year for single women
  • “The accelerating demise of defined benefit pensions”
    • 150,000 pension plans, which would have provided lifetime income security, have been discontinued since 1983, leaving less than 25,000 plans today, many of which plan to close within two years.
  • “The transition of the baby-boom generation into retirement”
    • the first boomers reached retirement eligibility in 2006 and will continue to enter the retirement ranks over the next 20 years, creating a huge cash drain on our Social Security system
  • “Longer expected lifetimes”
    • 65-year-old women have added another 4 years to their life expectancy since the 1960’s; over the past 160 years, women in the most developed countries have steadily added another year to their life expectancy for each four years that pass
  • “The much smaller post-baby boom generations who are being asked to support boomers’ unfunded benefits along with their own healthcare and retirement needs”
    • And owing to their greater life expectancy, women’s benefits will be much costlier to fund than men’s, all other things equal[2]

In addition to these points highlighted by Dr. Babbel, the U.S. Department of Labor has found that women are more likely to work in part-time jobs and therefore do not qualify for an employer-sponsored retirement plan. Their statistics show that, of the 62 million wage and salaried working women between the ages of 21 and 64 in the U.S. today, there are only about 45 percent who participate in a retirement plan—45 percent!

And even for those women who do actively participate in a retirement plan, they are more likely to contribute much less and, thus, have a lower amount of overall savings, due in large part to the fact that they are more likely than men to interrupt their working years to raise children and take care of aging parents.

Now that we have identified the hurdles and understand the different risks that are plaguing women today, what are the solutions? Stay tuned to next week as I will discuss how Fixed Indexed Annuities can offer some potential solutions for women in retirement.

[1] Nigel Barber PhD, “Why Women Live Longer Than Men: It’s All About Risk Management,” The Human Beast, August 10, 2010, https://www.psychologytoday.com/blog/the-human-beast/201008/why-women-live-longer-men

[2] David F. Babbel, “Lifetime Income for Women: A Financial Economist’s Perspective,” Wharton Financial Institutions Center Policy Brief: Personal Finance, July 31, 2008, http://fic.wharton.upenn.edu/fic/Policy%20page/RetirementIncome-Women.pdf

Posted in Personal Finance | Comments Off on A Special Note to Women: Part 1

7 Retirement Tips for National Save for Retirement Week














Posted in Personal Finance, Planning for Retirement | Comments Off on 7 Retirement Tips for National Save for Retirement Week

It’s Time to Close the Retirement Savings Gender Gap

(This blog first appeared on National Life Group’s blog, which you can view here.)

Women earn 78 cents to every dollar that men earn, according to the U. S. Department of Labor. That’s 23% less than their male counterparts. On top of that, the 2010 U.S. Census reports that 42% of all women lack financial security.

Susan Jennings is passionate about changing those statistics. Susan is Senior Legal Counsel for National Life Group and Executive Committee Member of the Indexed Annuity Leadership Council. She has been with National Life for 29 years. Since her days in law school, she has been an advocate for women’s professional development and has been a proponent of breaking down gender stereotypes.

Susan sat down to give a sneak peek of the topics that will be covered during the panel discussion, The State of American Retirement: Navigating the Gender Imbalance on October 15. Susan will join other influential financial and retirement experts in Washington D.C. to discuss ways to bridge retirement’s gender disparity so that all women are aware of how to prepare for a secure retirement.

What are some of the key gender imbalances related to financial planning and retirement?

Overall, women have saved far less for retirement than their male counterparts, and these same women are likely to live longer and actually need more to provide for their retirement needs. As the American population ages, we find that more and more women who had lived comfortable lives are entering poverty or near poverty in their retirement years.


Why is this the case?

Generally, women have less awareness about financial topics and defer financial decisions and responsibility to their spouse. This is particularly true in households where men are the primary breadwinner, but even in families where the woman is the primary wage earner, financial decisions, particularly decisions related to long-term retirement planning are often left to men or are left unaddressed completely. In many cases single-women, particularly single-mothers, feel the pressures of meeting daily expenses and don’t prioritize the importance of long-term saving. In fact, often times during divorce settlements women are primarily concerned with ensuring immediate care of the family and don’t even address the issue of dividing retirement assets.

It sounds like a large and significant problem, what can be done to change the situation?

It is a significant problem, and that is why we are convening the panel discussion to address the situation. We want women to be aware of the choices and options that are available to them and we need our legislators to know that retirement plans should not just allow employees to accumulate funds for retirement, but should also provide a determinable amount of income for the rest of their lives.


What are some of the things women can do today to shift the tide?

Well, one of the things that we can all do is make financial literacy and long-term saving a part of the dialogue with all women beginning with young girls. It is never too early to start talking about planning and saving for the future and it is never too soon to start learning about the tools that are available to make saving for the future possible. And I’m not talking about reading the Financial Times and Wall Street Journal, I am talking about using the many, many resources that are available on the Internet that are delivered in simple straight-forward language that are easy to understand and digest.

There are so many great blogs available for women to follow, that offer financial information from every perspective—be that of a young professional just starting out, to a stay-at-home mom, to a working mom trying to juggle family and career, to a single parent trying to live and save on one income. There are stories that every woman can relate to and identify with, and this is the type of conversation and information that needs to be shared so that every woman can understand that saving and providing for her future is and should be within her own power.

Additionally, there are online calculators and resources that can help people budget and determine how much they need to save in order to meet their retirement goals.

If you could provide women with one piece of advice related to retirement planning and saving, what would it be?

The single best piece of advice related to retirement saving is the same for everyone, whether women or not: save as much as you can, as early as you can. Start saving from the time that you get your first paying job—even if that is in your teenage years, it will form the habit of saving for the longer term and even small amounts can turn into something substantial over time. Specifically for women, the amounts they can save early in their career will really make a difference if they decide to take time out of the workforce in order to care for children or family members.

Additionally I would advise women to be aware of their risk tolerance. The prevailing message out there is that mutual funds and stock market-based investments are the best way to accumulate long-term growth. Women have inherent needs for security and stability, and need to be mindful that the aggressive ebb and flow of the market may not be the most palatable way to build their nest egg.

There are many other conservative savings and investment options to choose from, including fixed indexed annuities, which can provide upside interest potential in a positive interest rate environment but still provide protection of principal and guarantees when the markets are negative or volatile.

Join Susan Jennings at The State of American Retirement: Navigating the Gender Imbalance.

Securities can be offered solely be representatives registered to offer such products through a broker/dealer. Financial planning and investment advisory services can be offered by investment adviser representatives through a registered investment adviser.


Posted in Uncategorized | Comments Off on It’s Time to Close the Retirement Savings Gender Gap

4 Small Ways to Save Big

When it comes to saving for retirement, starting early is key. And while putting money away can seem like a huge and daunting task, it doesn’t always require major lifestyle changes. If you implement changes slowly and in small ways, you may not even realize how much you’re saving.

Here are 4 small ways you can make a big difference in your savings account:

1. Pay off your credit card on time. Waiting to pay off your credit card bills is a great way to accrue interest and lose money in the long-run. Instead, pay your credit card bill on time and put that extra savings towards your savings fund.

2. Set up automatic transfers. While it’s easy to promise yourself that you’ll transfer money to a savings account each month, it’s helpful to set up automatic transfers so that you aren’t tempted to spend the money.

3. Save your change. Cents turn into dollars quickly! Additionally, you can sign up for a savings program like this one, where everyday purchases made with your debit card will be rounded up to the nearest dollar amount, and the difference will be transferred from your checking to your savings account.

4. Have a plan. People who create concrete retirement plans are more likely to stick to them and on average, end up with three times more money than those who fail to create a plan.



Creating a secure retirement takes careful planning, and it’s never too early to start saving. Use our calculators to determine how much money you should be saving now to make sure you have a balanced financial plan and the lifetime income you’ll need.

Posted in Personal Finance, Planning for Retirement | Comments Off on 4 Small Ways to Save Big