Retirement Risk for Women: Oversold Immediate Annuities

Selling immediate fixed annuities to women retirees these days is about as hard as leading bears to honey. The combined impact of the market crash of ‘08 and the growing drumbeat of longevity risk warnings has given women a heightened awareness (if not low-grade fear) of outliving their money in retirement. That’s a golden opportunity for insurers who are quick to point out they have the perfect product to allay those concerns: a fixed immediate annuity that will make lifetime payouts. The concept is indeed sound, but the timing presents a retirement risk for women. Buying an immediate annuity right now and locking in a payout tied to today’s record-low interest rates isn’t exactly smart. But that hasn’t slowed down the insurers...

BNet: Retirement Risk for Women: Oversold Immediate Annuities