Annuities featuring life-only guarantees attracted 26% of advisor queries for quotes in 2017, up from 22.4% in 2016 and 20.5% in 2015, according to CANNEX USA data. CANNEX president Gary Baker commented that the increase may have been partly prompted by the Department of Labor's fiduciary rule, noting, "It's an indicator that financial planners who sell these products continue to take more of a planning approach versus a product sales approach."
Technological innovations such as advanced accounting tools and portfolio models that can incorporate legacy holdings are helping smaller advisory firms offer enhanced services that were formerly available only from their larger rivals. "The notion that wirehouse technology from an investment-ticking standpoint is superior to your typical mom-and-pop retail advisor is changing," says Davis Janowski, senior analyst for Forrester Research.
The Equifax data breach revealed in September exposed more consumer information than was originally reported, including tax identification numbers and phone numbers, Equifax said in documents given to the Senate banking committee. A forensic investigation led to the discovery, the company said.
American Equity Investment Life is getting ready to launch a fixed-indexed annuity that offers two fee options applicable to the guaranteed lifetime income rider. The new product, scheduled for release in March, will be sold exclusively through independent marketing organizations and independent agents.
The number of savers with more than $1 million in their Fidelity Investments 401(k) accounts rose from 93,000 at the end of 2016 to 150,000 at the end of last year, the company said. It also noted a significant rise in the number of women reaching the $1 million mark and a general increase in savers' contribution rates.
A higher-than-expected jump in consumer prices in January is a solid indication that worker wages are rising. However, the news brought consternation for many investors, who fear more interest rate hikes by the Federal Reserve this year.
The Financial Industry Regulatory Authority has released a paper focused on arbitration awards after it was revealed that a quarter of those made in 2016 went unpaid. In addition to amending several rules to encourage timely payments and make evasion more difficult, FINRA is seeking to work with the Securities and Exchange Commission and Congress on the issue.
The Securities and Exchange Commission wants a fiscal 2019 budget of $1.66 billion, up 3.5% from the amount in fiscal 2018. The additional money would let the SEC fill 100 positions lost during a hiring freeze in 2017.
Considering annuities when planning for retirement is growing in importance, particularly for high-net-worth individuals, according to accountant and financial planner Tami Noll Russo. "With interest rates still at historic lows, insurance products such as single-premium, immediate annuities and guaranteed income riders on investment accounts are becoming increasingly valuable with our highly volatile stock market," she says.
Economist and retirement security expert Teresa Ghilarducci says the impending US retirement crisis could be solved, with no need to cut benefits or raise taxes, by introducing guaranteed retirement accounts. Under her proposed system, workers and employers would be obliged to contribute 1.5% each of wages to the individual's account, and the funds would be managed by a federally appointed board of investment professionals.
IRI Insight Winter 2017-18 is now available! Annuities have had their share of detractors over the years. You may have seen disparaging advertising, but is such criticism warranted? The reality is annuities currently serve a critical purpose within millions of Americans' retirement portfolios -- adding a level of security while helping alleviate some financial worry for the future. In fact, those receiving income from an annuity report the highest satisfaction level among all investment types. Also in this issue: "My Security Blanket; A Retirement Story," "Emotional Aspects of Caregiving" and IRI's annual "Retirement by the Numbers" fact sheet. Download your copy here.
In its sixth annual State of the Insured Retirement Industry report, the Insured Retirement Institute reviews and analyzes the market environment, product development, annuity sales and distribution, and legal and regulatory developments that affected the retirement income industry in 2017, and discusses potential trends in 2018. Download the full report here.