SURVEY SAYS

SURVEY SAYS: Annuities and Lifetime Retirement Income

Retirement plan sponsors’, providers’ and regulators’ concerns about ensuring lifetime retirement income for employees has increased over the years.

By Rebecca Moore | July 10, 2017
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Last week, I asked NewsDash readers, “Do you own an annuity, and do you think individuals can have retirement income that lasts throughout retirement without owning an annuity?”

The majority (79.2%) of responding readers work in a plan sponsor role, while 4.2% are advisers/consultants and 16.7% are TPAw/recordkeepers/investment managers.

Few (7.7%) respondents indicated they own an annuity within their employer-sponsored retirement plan, while 15.4% own one outside of their employer-sponsored retirement plan, and the majority (76.9%) do not own an annuity.

Asked if they think individuals can have retirement income that lasts throughout retirement without owning an annuity, more than one-quarter (26.9%) said yes, while 11.5% said not, and 61.5% said it depends on their retirement savings situation.

Among those respondents who chose to leave verbatim comments, the majority seemed to be pro-annuity, while a few offered insight into how to have retirement income that lasts without owning an annuity. A couple of respondents said annuities have fees that are too high, and several mentioned that a defined benefit (DB) plan is the best source of annuitized income for retirees. Editor’s Choice goes to the reader who said: “Defined Benefit plans are unequalled for providing lifetime income with maximum efficiency.”

Thanks to all who participated in the survey!

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