Why Annuities Are Popular
May 29, 2019 by The Alliance for Lifetime Income
To the Editor:
Re “The Way to Stop Predatory Lending” (editorial, May 23):
We take issue with your criticism of fixed indexed annuities. These products, and indeed all annuities, can provide a guaranteed monthly income for the rest of a policyholder’s life, acting much like a personal pension plan or Social Security
In an era when just 4 percent of private-sector workers have defined benefit pension plans and when Social Security will cover just 40 percent of most people’s pre-retirement income, a guaranteed source of retirement income, like annuities, is a vital safety net.
Sales of annuities are also growing for other important reasons, including rising market volatility and higher interest rates.
The annuities industry — like every industry — faces rare, unacceptable sales practices. Yet annuities are popular because they provide retirement security in a volatile financial world. Far from criticizing them, you should be encouraging them.