CONSUMER INTEREST IN ANNUITIES IS GROWING
By Ron Grensteiner, President of American Equity Investment Life Insurance Company
In the face of market volatility, increasingly rare pensions, and a growing concern that they may outlive their retirement savings, consumers are desperate for sources of guaranteed income. As a result, according to a recent CNBC article, many consumers are turning to annuities.
In fact, as noted in the same article, Fidelity Investments said annuities sales to its customers have doubled since 2006. In addition, 87% of respondents to a recent survey from the Hartford said that they find it “very” or “somewhat” appealing to be able to turn at least a portion of their retirement savings into a guaranteed income. Employers are also starting to take notice, with more now offering annuity options in their 401(k) plans. Building off of this trend, the IRS is proposing to make it easier for savers to convert a portion of their 401(k) savings to an annuity product.
Still, there remains some hesitancy on the part of consumers when it comes to purchasing an annuity, much of which stems from confusion over how the products work. For consumers who would like to learn more about annuities—but are unclear about how they work and may provide a guaranteed source of income—the following educational video provides helpful information.