During the IRI Marketing Summit this week, the results of a recent study done by the IRI (Insured Retirement Institute) and AllianceBernstein were revealed. Through reviews of variable annuity demand and interviews with financial advisors, the study determined that variable annuity demand has increased because of market uncertainty and fluctuation. This information comes from a joint MarketWatch press release entitled “New AllianceBernstein & Insured Retirement Institute Survey Finds Market Uncertainty Has Increased Demand for Variable Annuities.”
At least half of the financial advisors questioned said that they are recommending variable annuities more now than they were before the market meltdown of 2008. As clients have showed more interest in variable annuities and global education about the products has increased, previous skeptics have actually turned into variable annuity advocates. Most advisors also said that they plan to continue their support of variable annuities, especially because they want to see their clients safe and secure from another financial meltdown like the one that occurred a few years back.
Client demand for guaranteed lifetime income has really driven a lot of this advisor interest in variable annuities. Increasing education from co-workers, wholesalers, or annuity organizations has also been a driving factor for advisors to recommend more variable annuities. Some reasons for selling variable annuities given directly from the advisors questioned include offering variable annuities when they see that a client’s savings won’t last their entire lifetime, offering clients a low risk way to guarantee growth and retirement withdrawals, and excellent enhancements to the product offerings over the past couple of years. Clients are willing to pay for the benefits offered by variable annuities, so it’s in the advisor’s best interest to be knowledgeable about this retirement vehicle.
Written by Rachel Summit
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