Sixty-one percent of Americans between the ages of 55 and 75 believe having guaranteed income to supplement Social Security is a smart and sound benefit, Greenwald & Associates and CANNEX found in a survey of 1,105 people. Sixty-one percent believe it is incumbent on advisers to discuss guaranteed income products with them, and a great deal more, 90%, think their adviser should help them devise a retirement income strategy.
In addition, 81% of those over the age of 50 think it is important to protect their portfolio against significant investment losses. However, only 33% are highly familiar with annuities, and even fewer are familiar with annuities that guarantee income for life.
Even among those who own an annuity, only 53% say they are knowledgeable about the product’s features.
Asked why they would want guaranteed income, respondents said it provides extra protection should they live to a ripe old age (35%), peace of mind (31%), the ability to budget with confidence (29%), maintaining a comfortable lifestyle (27%) and receiving a higher payout than what savings accounts and certificates of deposit (CDs) are currently paying in this low interest rate environment (24%).
Asked why they may not purchase a guaranteed income product, 25% said they have too many terms and conditions, 23% said they cost too much, 22% said they do not always pay back all of the money they cost to purchase, 21% said they are difficult to understand, and 19% said they tie up your money.
But people do not know what a monthly income payout from an annuity would cost; asked how much they would be willing to pay to receive $1,000 a month for life, 66% could not even hazard a guess.
Asked about withdrawal strategies, only 30% said they were pretty confident they knew what would be a good tactic.