Despite more than a half-century of research detailing the potential value of guaranteed lifetime income products for retirees, sales of annuities remain low. There is a new annuity gaining traction in the marketplace where the lifetime income evolves based on account performance where the account value is accessible, an approach we call a “Protected Lifetime Income Benefit.” This presentation contrasts this particular structure against other annuities focused on lifetime income and provides context for which types of retirees the respective solutions are likely to work best.
Learning Objectives:
Why annuities should be considered as part of a retirement income plan.
The payout mechanics for single premium immediate annuities (SPIAs), deferred income annuities (DIAs), annuities with a Guaranteed Living Withdrawal Benefit (GLWB), and Protected Lifetime Income Strategies (PLISs).
Why utility is a better metric to estimate optimal retirement strategies versus the probability of success.
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