Guaranteed Income Is Important

The fifth annual “Guaranteed Lifetime Income Study” by Greenwald & Associates and CANNEX shows significant differences in perception between advisers and clients regarding retirement income discussions.

Advisers said they discuss income strategies with an average of 79% of their clients, but only 55% of clients reported having such conversations. Advisers also consistently underestimated client interest in guaranteed lifetime income products, the study says.

Two-thirds (67%) of those close to retirement or in its early stages said they highly value guaranteed income to supplement Social Security. When guaranteed lifetime income products were mentioned as part of a retirement portfolio strategy to supplement Social Security and cover essential expenses, 71% said they think this would be a good strategy for their own retirement.

The research also reveals growing evidence that consumer sentiment appears to fluctuate based on the prevailing market environment, dropping as stocks rise and increasing when the market experiences sharp volatility. In addition, the research highlights that the top retirement concerns driving interest in guaranteed income include paying for long-term care, meeting health care needs and not running out of money.

Among the respondents who reported owning a guaranteed lifetime income product, six out of 10 said they are satisfied with them, and three-quarters said they would recommend them. They also claimed to be less concerned about day-to-day expenses in retirement, reported being able to budget more effectively and said they spend more on discretionary items. Product owners are less worried about losing savings during a downturn, they said