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How to Walk Through Fire
Tue, Aug 04, 2009
Crossing the retirement "red zone" might be compared to a fire-walk. But here are three advisors who are guiding clients (and their portfolios) from age 55 to age 65 with barely even a hot-foot.
Kerry Pechter
Heck Of A Job, FINRA!
Fri, Mar 27, 2009
Mary Schapiro spent the past ten years as president of FINRA or its predecessor, NASD. During that time, FINRA dithered while two stock market bubbles and the Enron crime vaporized the savings of millions of Americans.
Talk About a Shake Out
Tue, Mar 24, 2009
Faced with capital shortages and ratings downgrades, the ranks of major publicly-held life insurers appears to be headed for consolidation. Historically low stock prices alone have made merger talk inevitable.
Democrats Expected to Tweak, Not Scuttle, IRAs and 401ks
Wed, Apr 08, 2009
Speaking at LIMRA’s Retirement Industry Conference in Orlando on April 3, an attorney-lobbyist predicted that tax incentives for insurance and retirement products will undergo scrutiny by the White House and Congress.
The End of the VA Arms Race
Thu, May 21, 2009
The variable annuity "arms race" is over, a victim of the equity crash, low interest rates, and the destructive effects of competition for market share - mainly among publicly held life insurers. Here's a three-part look at what has happened, why it happened, and what could happen next in the "living benefit" space.
The End of the VA Arms Race - Part II
Thu, May 21, 2009
VA living benefit issuers were not simply passive victims of the stock market debacle. They were playing a dangerous game, and knew it.
The End of the VA Arms Race - Part III
Thu, May 21, 2009
The guaranteed lifetime withdrawal benefit will survive by attaching itself to a new product, such as managed accounts, or by finding a new market, like workplace retirement plans.
Prudential Retirement Weds GLWB to TDF
Thu, May 21, 2009
The new offering, a group variable annuity called IncomeFlex Target or IFX Target, is designed to be fully automatic. If not exactly a “cradle-to-grave” plan for qualified plan participants, it's potentially a “first-job-to-grave” plan.
Mr. Indexed Annuity Goes To Washington
Thu, May 21, 2009
On a sultry afternoon in Washington, the Capitol looked stark, lonely, and forbidding. But NAFA members persevered in their long-planned "March to the Hill" to enlist legislators in a bi-partisan fight against SEC Rule 151A.
Regulatory Cloud Stifles EIA Market
Thu, May 21, 2009
Only two new EIA contracts were issued in the first quarter of 2009, both with bonuses and both with mandatory GLWBs. They were Forethought Life’s single-premium Income 125 and American Equity’s flexible-premium Retirement Gold.
Making More Than Peanuts at MetLife
Tue, Jun 09, 2009
The financially fit, well-diversified insurer collected almost twice as much in annuity premiums as its closest competitor in the first quarter of 2009, benefiting from a “flight to quality” in the wake of last year’s economic meltdown.
Can Retirees “Thrive” On Deferred Income Annuities?
Tue, Jun 02, 2009
Iowa insurance man Curtis Cloke thinks he has solved the "annuity puzzle" by building ladders of deferred income annuities for his clients. Now he and his partners are scaling up his "Thrive" system and taking it national.
Fixated On Fixed Annuities
Tue, Jun 02, 2009
Sales of fixed annuities topped $30 billion in the first three months of 2009, as investors and advisors feasted on their safe, better-than-CD returns for the second consecutive quarter.
“Outcome-Driven Investing” Is The Future, DWS Exec Says
Tue, Jun 02, 2009
The financial world has left the “Harry Markowitz” era where Modern Portfolio Theory and Monte Carlo projections reigned, says Philipp Hensler, CEO of U.S. distribution for DWS Investments.
Deloitte Maps the Future of Financial Services
Tue, Jun 09, 2009
Deloitte has a new patent pending product, Life Options, that would allow consumers to purchase insurance against capital market downturns and longevity risk.
A Smarter Form of SWiP
Mon, Jun 15, 2009
Financial advisor Larry Frank Sr. of Rocklin, Calif., a small town in the arid foothills of the Sierra Nevadas, has fine-tuned the classic 4% "SWiP" approach to drawing down retirement income.
NAVA Steps Up Its Lobbying Game
Tue, Jun 09, 2009
NAVA has moved from the Virginia suburbs to downtown Washington, the better to lobby Congress on behalf of annuity manufacturers and distributors. But the Association for Insured Retirement Solutions, as NAVA has called itself for the past two years, won't reveal its new name or acronym until July.
Raising Private Savings
Tue, Jun 30, 2009
What might be called the financial version of universal health care is currently the topic of intense discussions and negotiations on Capitol Hill.
Details of the Auto-IRA/Saver’s Credit Plan
Mon, Jun 29, 2009
David John of the Heritage Foundation, and the Treasury's J. Mark Iwry, hope to see years of work finally bear fruit.
Why We Retired Our Pensions, and How to Revive Them
Wed, Jan 05, 2011
An ambitious new book, The Decline of the Traditional Pension, captures the state of public, private, domestic and global pensions with scholarly rigor.
New Treasury Official Outlines Plans for Retirement Overhaul
Mon, Jun 15, 2009
J. Mark Iwry spoke to a National Press Foundation group about the Automatic IRA, the Saver's Credit and the R-Bond, which he hopes will work in unison to bring employer-based retirement plans to workers who currently don't have them.
Under Putnam’s Hood, A Fidelity Engine Roars
Tue, Jun 23, 2009
In the past year, Putnam Investments owner Great-West Lifeco has recruited (l-r) Fidelity veterans Robert L. Reynolds, Jeffrey R. Carney and Edmund F. Murphy III, among others, perhaps to capitalize on Obama's plan for universal retirement savings coverage.
Target Date Funds: A QDIA That’s DOA?
Mon, Jun 22, 2009
Last week, federal officials tried to locate the blame for 2008 TDF losses: Was it marketing hype by TDF makers, a flawed concept, Americans' weak financial literacy, regulatory lapses, or merely the caprice of the markets?
Obama Calls for ‘Office of National Insurance’
Mon, Jun 22, 2009
While the administration's June 18 report, "Financial Regulatory Reform," did not offer the “optional federal charter” that large insurance companies support as an alternative to state-by-state regulation, it did not rule one out.
In Washington State, a ‘State 401(k)’ Is Rejected
Mon, Jun 29, 2009
When it comes to designing public-private retirement savings programs, Sandy Matheson has been there and done that.
What Affluent Investors Want
Tue, Aug 25, 2009
About one-third of affluent investors make all their own retirement decisions, the Phoenix study showed.
Comment: Bernanke Paints Crisis as a ‘Classic Panic’
Tue, Aug 25, 2009
"Although a panic may be collectively irrational, it may be entirely rational at the individual level," said the Fed chairman.
Mapping Out the Market for LTC Hybrids
Wed, Jul 08, 2009
In some cases, the fixed annuity will lead the sale and in others the LTC insurance will lead the sale.
A Short Cut to Long-Term Care Insurance
Tue, Jul 07, 2009
United of Omaha, Genworth Life, Bankers Life, and OneAmerica have introduced LTC/annuity hybrids in the run-up to January 1, 2010, when distributions from annuities to pay nursing home bills will be tax-free.
SPIA/LTC Hybrid Still Just a Concept
Tue, Jul 07, 2009
In this product, the adverse selection factors that plague both LTC insurance and immediate annuities would partially cancel each other out.
Feeling TIPSy
Tue, Jul 14, 2009
Seeing the potential for inflation ahead, analysts now recommend inflation-protected Treasuries, or TIPS, more strongly than ever. But 401(k) participants buy few TIPs, and not every plan offers them.
Separation Anxiety
Tue, Jul 14, 2009
Steve Sass and his co-researchers at Boston College were surprised to find no employers making plans to accommodate workers who can't afford to retire and want to remain on the job past the customary retirement age.
Investing Enlightenment At A Glance
Wed, Jul 15, 2009
This up-to-date "Periodic Table of Returns" shows that in financial markets, what goes up always comes down, and vice-versa.
CalPERS Gives Rating Agencies an FFF
Tue, Jul 21, 2009
In a new lawsuit, California's state pension fund blames the 'issuer pay system' at the top three rating agencies for part of its investment losses last year.
Hold Brokers and Advisors to One Standard, SEC Chief Says
Tue, Jul 21, 2009
Mary Schapiro told Congress she favors requiring broker-dealers and investment advisers to act solely in the interests of their clients when providing advice.
Martin Weiss on the CalPERS Suit
Tue, Jul 21, 2009
There have been 'egregious manipulations and conflicts of interest that go beyond what is generally known,' Weiss told RIJ.
A Summer Crop of Variable Annuities
Tue, Jul 28, 2009
Allianz Life, Genworth Financial, John Hancock Life, and MetLife have all introduced new variable annuity contracts. Of the four new entries, John Hancock's stands out as the simplest and cheapest.
Will SEC Rustle Insurers’ Cash Cow?
Tue, Jul 28, 2009
A federal appeals court has ruled that index annuities are risky enough to be called securities, but it also gave insurance forces time to pursue a legislative remedy in this regulatory turf war.
What Obama Didn’t Say About Health Care
Tue, Jul 28, 2009
Doctors may choose to donate care to the needy when it suits them. But they won't let the government turn their profession into a public utility.
Nationwide and MSSB Ink SALB Deal
Tue, Aug 04, 2009
A Nationwide income guarantee will be offered to Morgan Stanley Smith Barney's Select UMA holders. The wirehouse expects to use up the initial $250 million capacity in six months.
‘Breakaway Broker’ Is A Myth
Tue, Aug 04, 2009
Wirehouse reps still manage almost half of the assets in all retail advisory channels, according to Cerulli Associates' exhaustive annual study.
One-Stop Shopping for Retirement Risk
Wed, Aug 12, 2009
Steve Zaleznick sells insurance direct to the elderly online. But can his call center reps offer more than piecemeal planning?
Banks Reap Record Annuity Income
Tue, Aug 11, 2009
The steep yield curve enabled fixed annuities to outperform CDs, and drove fixed annuity sales to a new record in the second quarter.
Comment: The High Price of Low Rates
Tue, Aug 11, 2009
A low interest rate policy, while necessary in a crisis, acts as a tax on the average person and plants the seed for the next credit crisis, according to two NBER Working Papers published in July.
IRI: Not Just NAVA by Another Name
Wed, Aug 19, 2009
Where NAVA might have been described as inward-looking, IRI seems to be outward-looking. Some members think that's a refreshing change.
Will Boomers Pony Up for these Riders?
Tue, Aug 18, 2009
Deferred annuities have lapse rates as high as 40% to 70%, but the lapse rates of LTCI/annuity hybrids could shrink to as low as one or two percent—the rates associated with LTCI policies.
A Chat with Jackson’s Clifford Jack
Wed, Aug 19, 2009
'We talk all the time about not being the team that performs extremely well for eight and two-thirds innings just to screw it up on the final out,' said the Jackson National EVP.
How Good Is This Ad? You Decide.
Wed, Aug 26, 2009
This ad drew a wide range of responses. Many reviewers said it “spoke to them.” Some said it left them cold.
What I read at the beach in August, and how I almost appeared on Fox News
Tue, Sep 08, 2009
I finally found time to read "Boomsday," Christopher Buckley's novel about a presidential candidate who asks Baby Boomers to save Social Security by agreeing to commit suicide at age 70.
Despite Crisis, Total Annuity Sales Lag By Just 3%
Wed, Sep 09, 2009
Almost 90% of purchasers of new variable annuity contracts are electing living benefits and almost 60% are electing guaranteed lifetime income riders, despite industry-wide pull-backs in those benefits.
A Few New Names on Annuity ‘Leaderboard’
Tue, Sep 08, 2009
Since the end of 2008, Sun Life, American Equity Investment Life and MassMutual have joined the list of the top 20 annuity sellers, while Genworth Financial, Principal Financial, and Allstate have slipped off.
It’s Spee-Ahz, By a Nose!
Wed, Sep 09, 2009
Gaobo Pang and Mark Warshawsky's study supports a strategy of combining income annuities with mutual funds in retirement.
Retired Americans, Up Close and Personal, Via PBS
Tue, Sep 08, 2009
“The fact that there haven't been more television pieces taking a look at retirement is remarkable,” said documentary filmmaker Brian Boyer.
Inflation Cushion
Wed, Sep 16, 2009
PIMCO envisions a trillion-dollar retail and institutional market for its new TIPS-based ‘Real Income’ managed payout funds.
Early Reviews of PIMCO’s Payout Funds
Wed, Sep 16, 2009
Immediate reactions from advisors, retirement income consultants and academics ranged from skepticism to enthusiasm to uncertainty about the costs.
Decumulation Beat
Tue, Sep 22, 2009
The Insured Retirement Institute held the first annual conference under its new name in Boston this week, and the difference between IRI and NAVA was striking.
Sales of Indexed Annuities Soar in 2nd Qtr, Says Beacon
Wed, Sep 16, 2009
For the entire fixed annuity market, 2009 has been a bumper year so far. On a year-to-date basis, total market sales were an estimated $62.6 billion, 39% above first half 2008.
The Dollar Is On Plavix, Lipitor and Cialis
Tue, Sep 15, 2009
Given the possibility of higher inflation ahead, the new PIMCO TIPS payout funds may be just what the doctor ordered.
RIIA Launches Designation for Retirement Advisors
Tue, Sep 22, 2009
Francois Gadenne and the Retirement Income Industry Association want to spread the doctrine of "build a floor, then create upside."
Larry Kotlikoff to Receive RIIA’s Academic Achievement Award
Tue, Sep 22, 2009
The Harvard-trained economist teaches, consults, writes scholarly and popular books, created ESPlanner, and is the champion of “consumption smoothing.”
A Comic Approach to Participant-Ed
Wed, Sep 30, 2009
A Dutch pension administrator hopes a mildly racy comic book will help educate its plans' younger bus drivers and railway workers.
Shunned in U.S., Income Annuities Thrive in the U.K.
Wed, Sep 30, 2009
The "at retirement" market for annuities in the U.K. topped £14 billion in 2008 and is expected to reach about £23 billion in five years.
Jackson National Launches Bonus VA
Wed, Sep 30, 2009
Perspective Rewards pays a 6% bonus on first-year premiums under $100,000 and 8% on higher ones.
'Old People with Attitude and Expectations'
Tue, Oct 06, 2009
Boomers hope for a long and feisty retirement. But at the Longevity 5 conference in Manhattan last month, experts saw global aging as a threat almost as great as global warming.
Let’s Look at Your Telomeres
Wed, Oct 07, 2009
These loss-leaders at the ends of chromosomes, which help determine our longevity, were the basis for this week's Nobel Prize in Medicine.
Presidential’s New Campaign
Wed, Oct 07, 2009
Presidential Life has engineered a two-tier income annuity where the first annuitant receives benefits for life but the survivor receives income for a period certain or for life, whichever is less.
The Abnormal Is the Norm
Wed, Oct 14, 2009
Does anyone really coast smoothly into retirement? Not guys like my friend Mark, the brilliant engineer. He married at 40, was laid off at 55, and now, at 62, is scrambling to put two kids through elite private colleges. The abnormal is the new norm.
In the ‘Green Zone’ with Jim Otar
Wed, Oct 14, 2009
The Toronto engineer-turned-advisor has self-published an exhaustive new book and launched a refined version of his Retirement Optimizer software.
Unsolved Mystery
Tue, Oct 20, 2009
In Matt Greenwald's "mystery shopper" experiment, near-retirement couples met with eight financial advisors to find out if they would recommend income annuities. None did.
Get Smart
Tue, Oct 20, 2009
With its inflation-adjustments and liquidity features, Lincoln's new SmartIncome SPIA is designed to answer the usual objections to income annuities.
From Down Under, A Novel Income Product
Wed, Oct 21, 2009
The Challenger Guaranteed Income Fund (GIF) aims to provide a monthly income stream and a return on capital after three, five or seven years.
Taiwan Grapples With Retirement Finance
Wed, Oct 28, 2009
Over lunch in Taipei, economist Jack Wu explained the pension dynamics of an aging society.
Neapolitan Annuity
Tue, Oct 27, 2009
Hartford Life’s new Personal Retirement Manager is three products in one. It bundles a deferred income annuity with a variable investment and a fixed return account.
The View from Taroko Gorge
Wed, Nov 04, 2009
Touring this marble-walled canyon, I could see millions of years into Taiwan's geological past and a few years into its demographic future.
An Income Feather in BoA’s Hat
Wed, Nov 04, 2009
Bank of America’s new service, My Retirement Income, is a revival of a program created at Merrill Lynch in 2006.
Estimating Out-of-Pocket Health Care Costs in Retirement
Tue, Nov 10, 2009
Couples can expect to spend $200,000 or more on premiums, deductibles and co-pays in retirement. This article is the first in a series on retirement risks.
RIJ Reaches a Milestone
Tue, Nov 10, 2009
Next week, Retirement Income Journal will begin charging a subscription fee. Our readers say we're worth it.
House Passes Historic Health Reform Bill
Wed, Nov 11, 2009
The so-called “public option,” declared dead last summer, is very much alive in H.R. 3962.
Dubya’s Lingering Gift
Wed, Nov 18, 2009
Tax rates are obviously northbound. So high-bracket folks should convert to Roth IRAs next year, right? Not necessarily, advisors told us.
RMD and Dangerous? Not Really.
Wed, Nov 18, 2009
The RMD must surely suffer when people discuss Roth IRA conversions, just as cavemen suffer when they see Geico commercials.
Ally, Ally, InFRE
Tue, Nov 24, 2009
The International Foundation for Retirement Education, directed by Kevin S. Seibert, CFP, has been certifying retirement advisors since 1997. Now the certifier itself is certified.
Re-Start Your Engines?
Wed, Nov 25, 2009
Strong insurers offering VA income riders with attractive roll-ups did very well in the third quarter, but sales for the category as a whole were flat.
The Latest Chapter in the Indexed Annuity Saga
Tue, Nov 24, 2009
In Mooney vs. Allianz Life, the jury didn't award damages because the plaintiffs couldn't prove that they lost money on their investments in indexed annuities.
AXA Trumpets a Treasury-Linked VA Rider
Wed, Jan 06, 2010
AXA Equitable Life (and its trademark gorilla) have bounced back from the financial crisis with a novel variable annuity rider that pegs guaranteed accumulation and withdrawal rates to the 10-year Treasury rate, plus one percent.
And In Comes 2010
Wed, Dec 30, 2009
I predict that the next decade will be very much like the last one, only more so. Interest rates are my top-of-mind issue.
FundQuest to Carry Fidelity's No-Frills Variable Annuity
Wed, Dec 02, 2009
The alliance marks the first time Fidelity's annuity and insurance business has expanded its distribution through a turnkey asset management firm.
Holiday Cheer
Wed, Dec 02, 2009
Forget doom-and-gloom. Recent research suggests that the Crash of 2008 will not prevent most Boomers from retiring as planned.
It’s Reigning Buckets
Wed, Dec 02, 2009
Envestnet's new PlanHorizon income distribution method resembles other 'bucket methods' like IFLM and RetireSense, but also integrates the bucket method into the firm's full-service investment and administrative platform for independent advisors.
Luck of the Draw
Wed, Dec 09, 2009
In this second installment of our series on retirement risks, we examine sequence-of-returns risk: what it is, what it can cost, and how best to deal with it.
Allotted $700 Billion, TARP May Cost Far Less
Wed, Dec 09, 2009
Democrats plan to divert about $70 billion from what is left in the bailout fund to construction projects, credit to small businesses and aid to state and local governments.
Letting the GLWB Out of Its Cage
Tue, Dec 08, 2009
The "Ruin-Contingent Life Annuity" proposed by Moshe Milevsky's QWeMA Group would liberate the guaranteed lifetime withdrawal benefit from the confines of variable annuities and separately-managed accounts.
Ally, Ally, InFRE
Tue, Nov 24, 2009
The International Foundation for Retirement Education, directed by Kevin S. Seibert, CFP, has been certifying retirement advisors since 1997. Now the certifier itself is certified.
Bridge to Somewhere
Wed, Dec 16, 2009
"Liability-driven investing for individuals" is how J. Brent Burns, MBA, (left), and Stephen J. Huxley, Ph.D., describe Asset Dedication, which is the name of their bond-laddering methodology, their book and their company.
Can’t Do The Math
Tue, Dec 22, 2009
You knew it all along, but now there's evidence. Most Americans are financially illiterate. Experts wonder how the millions who don't understand compound interest can possibly fashion successful retirements.
The Passion of Anna
Wed, Dec 23, 2009
Economist Annamaria Lusardi started studying financial literacy in 2000. She soon realized that it's not a luxury for the few. It's an empowerment tool for the many.
Test Your Financial Sophistication
Wed, Dec 23, 2009
Here are 18 true-or-false questions that economists asked Americans over age 55. The average score among the college-educated was 68%. Perhaps you'll fare better.
The Medical-Industrial Complex
Wed, Dec 23, 2009
Thirty years ago, Arnold Relman coined the term, "medical-industrial complex." He calls the Senate health care bill "half a loaf," but hopes it passes.
The Trouble with Calculators
Wed, Jan 13, 2010
A new critical survey of twelve retirement planning calculators shows why they're so frustrating to use.
Obama Is All Ears About Annuities
Wed, Jan 20, 2010
But there's no clear indication that Washington understands the nuances that make annuity decisions so complex and problematic.
Unfinished Business
Wed, Jan 13, 2010
Ernst & Young's Lynn Pettus and Hall Kesmodel show how the regulations governing participant education have shifted over the years, and how the changes in Washington have delayed their resolution.
VALIC Sued Over “Redundant” Tax Benefits
Tue, Jan 12, 2010
Lawsuits accusing insurers of selling tax-deferred annuities to fund tax-deferred accounts have not been entirely unfruitful for plaintiffs.
Ready for a Reality Check
Tue, Jan 19, 2010
A recent Journal of Financial Planning article on annuities was a bit perplexing.
The Visible Hand Behind the Crisis
Tue, Jan 19, 2010
Viral Acharya and colleagues at NYU's Stern School of Business say the economy was pushed off a cliff by bankers skirting reserve requirements.
New York Life Introduces ‘Lifetime Wealth Strategies’
Wed, Jan 20, 2010
The big mutual insurer plans to offer its managed account program, incubated last year among career agents, to third-party registered reps, says Michael Gordon, first vice president in the firm's U.S. life insurance and agency business.
Heard On The Grapevine
Wed, Jan 27, 2010
An all-star group of RIIA members engaged in a spontaneous online debate about 'time-segmentation' bucket methods. Here’s what they said.
Employer Match Strikes a Hot Debate
Wed, Jan 27, 2010
Academic and industry researchers clashed over methodology, but they appear to agree that auto-enrollment in 401(k) plans might have unintended consequences on the employer matching contribution.
The Strongest Financial Brands Are…
Wed, Jan 27, 2010
In Cogent Research's Investor Brandscape 2010 survey, Vanguard, Charles Schwab and TIAA-CREF earned top honors for brand strength. But many affluent investors are mistrustful of the financial industry and uncertain about the future.
For VAs, Roll-Ups Rule
Wed, Jun 16, 2010
Perhaps unintentionally, "roll-ups," aka deferral bonuses, have arguably become the key feature of variable annuities with GLWBs. But can they save VAs from becoming a niche business?
SunAmerica Links VA Rider Fees to Volatility Index
Wed, Feb 03, 2010
Designed for the Polaris series of variable annuities, the two new guaranteed minimum withdrawal benefits are called Income Plus 6% and Income Builder 8%.
To Insurers’ Relief, VA Owners Acted Inefficiently
Tue, Feb 02, 2010
Ruark Consulting's study showed that one in five owners of contracts with a guaranteed lifetime withdrawal benefit (GLWB) or guaranteed minimum income benefit (GMIB) took withdrawals between 2005 and 2009.
In Search of Plan C
Wed, Feb 03, 2010
“We have a crisis of confidence regarding retirement,” said assistant Secretary of Labor Phyllis C. Borzi at the NIRS conference in Washington, D.C. Tuesday.
Easing a Widow’s Hardship
Wed, Feb 10, 2010
What's the best way for a 62-year-old man to say “I love you” to his wife? By waiting to claim Social Security benefits until he reaches full retirement age or later. Here's our third article in a series on retirement risks.
Spotlight on Chairman Schapiro
Wed, Feb 10, 2010
Lawsuits questioning the competence and integrity of the SEC chairman were discussed at a closed-door meeting of the FINRA board of governors in New York February 10.
In League with the Angel of Death
Wed, Feb 17, 2010
Lawsuits filed in Rhode Island, New York and Illinois shed light on the sinister, multi-million-dollar strategy of using the dying as fronts to exploit variable annuity loopholes.
The Future of Fixed Annuities: A 2020 Vision
Wed, Feb 17, 2010
Jack Marrion predicts that by 2020 the securities industry will exercise control over the annuity market in the U.S.
Robin Hood or Just Robbin’?
Sat, Jan 02, 2010
Rhode Island attorney Robert Flanders said "stranger-originated annuity transactions" are perfectly legal.
The Exploitation of Sherry Pratt
Wed, Feb 17, 2010
Identity theft does not begin to describe the harm done to a quadriplegic woman who died of bedsores in a Chicago nursing home.
“Face-Off” at the IRI Marketing Conference
Wed, Feb 24, 2010
Annuity manufacturers and distributors went eyeball-to-eyeball at the Insured Retirement Institute's marketing conference in New York this week, where medical economist J.D. Kleinke (pictured here) was a featured speaker. Photo by IRI.
‘Saving More’ Trumps ‘Working Longer’
Wed, Feb 24, 2010
"I'll-work-till-I-drop" is often the first, but rarely the most sensible, response to a setback in retirement savings.
America Speaks Out—and Against—401(k) Annuities
Wed, Mar 03, 2010
As of March 2, the responses to the Obama administration's request for input on lifetime options in 401(k) plans tended to be angry but well-reasoned.
Vanguard’s Forecast of Future Returns
Wed, Mar 03, 2010
The Vanguard Group's data suggests that annualized real returns will most likely be 6% for stocks and zero to 2% for bonds over the next 10 years.
So Few Words, So Many Implications
Tue, Mar 02, 2010
The Department of Labor proposes a subtle change in 401(k) advice regulations that may have huge repercussions for fund companies.
If You’re Human, You Have Capital
Wed, Mar 10, 2010
Ibbotson president Peng Chen asks, “Are you a stock or a bond?”
Black Swan or Black Turkey?
Tue, Mar 09, 2010
The Great Recession is just the latest financial ‘black turkey,’ said the CFA Institute's Laurence B. Siegel at the Morningstar/Ibbotson conference in Orlando.
The Joy of Illiquidity
Tue, Mar 09, 2010
The legendary Roger Ibbotson told money managers that there’s hidden gold in low-turnover stocks.
The Empire Strikes Back
Wed, Mar 17, 2010
Lest they be drowned out by 401(k) critics, major DC plan providers have formed a new trade group, the DCIIA, chaired by PIMCO's Stacy Schaus. The group supports target-date collective trusts, deemed IRAs and lifetime income options.
Breaking Up Is Hard to Do…
Wed, Mar 17, 2010
…But it can’t possibly be as difficult as health care and pension reform.
Milliman Offers Hedging Strategies to Distributors
Tue, Mar 16, 2010
With three trading platforms around the globe, the Chicago-based actuarial consultant has come a long way from merely advising insurers.
Spock-o-nomics at the RIIA Meeting
Wed, Mar 24, 2010
At the spring meeting of the Retirement Income Industry Association, held at Morningstar Inc. in Chicago, concepts like "stocks for the long run" and "safe withdrawal rate" were out of favor.
Floor It!
Thu, Mar 25, 2010
In the Arizona desert, Mike Zwecher had a vision that led to his new book on building outcome-oriented retirement portfolios.
RIJ Receives a Tough-Love Letter
Thu, Mar 25, 2010
Garth Bernard and Cogent Research help resolve a question about the popularity of income products.
Eating the Competition’s Lunch
Tue, Mar 30, 2010
MetLife’s Retirewise program offers hundreds of brown-bag seminars, like the one depicted in this ad, for 401(k) participants at firms where MetLife isn’t the provider.
ING Offers a Simpler, Cheaper Variable Annuity
Wed, Mar 31, 2010
The contract costs 2.25% a year, including 100 bps for the income rider, 75 bps for the M&E risk fee, and 50 bps for fund management, says Bill Lowe, president of ING Financial Solutions.
New Public Pension Fund in UK Ponders Investment Strategies
Wed, Mar 31, 2010
Britain is developing a system of personal investment accounts targeted at low and middle-income workers who may or may not have a workplace savings plan.
Two Trends in One: CTFs and TDFs
Wed, Apr 07, 2010
Collective trust funds and target date funds are ‘made for each other,’ one analyst said. But will CTF-TDF hybrids create the same false sense of security among 401(k) participants that TDF mutual funds have?
Hartford CEO to VAs: “Never Again”
Wed, Apr 07, 2010
The insurer won't focus on VAs as much as in the past. It expects total annuity sales of $5 billion in 2012, or less than half its individual annuity sales in 2008.
How Big Is the Gap in Public Pensions?
Tue, Apr 20, 2010
Depending on the rate one uses to discount future obligations, state and local government pension plans face a funding shortfall in the wide range from $1 trillion to $3 trillion.
One Man’s Response to Uncle Sam’s RFI
Wed, Apr 14, 2010
Joe Bellersen, president of Qualified Annuity Services, Inc., explains how employer plans lost their guaranteed income mojo over the past 30 years, and offers advice on how they might get it back.
Annuity Products That Will Sell
Wed, Apr 14, 2010
At LIMRA's 2010 Retirement Industry Conference, consultant Timothy Pfeifer identified the deferred and immediate products that he thinks are ideal for insurers, distributors and investors today.
Volcker’s Minsky Moment
Wed, Apr 21, 2010
“The banks shouldn’t be running casinos on the side,” said former Fed chairman Paul Volcker at the Hyman P. Minsky Conference in New York last week.
The Future of DC Plans, Via PIMCO
Wed, Apr 28, 2010
A PIMCO executive’s new book is an ode to custom target date funds—and offers a glimpse of the Allianz unit’s retirement business strategy going forward.
Great-West Enters the In-Plan Income Space
Tue, Apr 27, 2010
"SecureFoundation" wraps a lifetime income rider around a set of proprietary target date funds for an all-in annual fee of 160 basis points.
The Savings Sweepstakes
Wed, May 05, 2010
Lottery-like savings programs aren’t widely legal in the U.S., but a Harvard Business School professor believes they could inspire more low and middle-income Americans to save.
From GAO, a Primer on Retirement Income
Wed, May 05, 2010
Last week, the Government Accountability Office sent a snapshot of America’s retirement income status to Sen. Herb Kohl, who will hold hearings on the topic in June.
Using Psychology to Sell Annuities
Tue, May 11, 2010
Some behavioral finance experts believe that principles of psychology could be used to boost annuity sales.
Mad About 401(k) Annuities
Tue, May 11, 2010
Part I: ‘Keep Your Hands Off My 401(k).’ Based on their recent e-mails to the Labor Department's RFI, some Americans think Uncle Sam wants to confiscate private savings.
Part III: Industry Answers
Wed, May 12, 2010
In the final week or two of its RFI on in-plan annuities, the Labor Department began receiving comments from the industry that has a big stake in the way 401(k) assets are distributed.
Part II: Tracing the Distortion
Wed, May 12, 2010
In print, on radio and on TV, Rush Limbaugh and Newt Gingrich helped fuel the rumor that 401(k) plans were under attack.
From an IVA, New Blood for Insurers
Tue, May 18, 2010
Life insurers, advisors and consumers should embrace his immediate variable annuity (IVA) with a refund option and a death benefit, says Achaean Financial CEO Lorry Stensrud.
A Sobering VA Outlook, Via Cerulli
Wed, May 19, 2010
"The industry is still feeling the fallout from the Great Recession," Cerulli's Lisa Plotnick tells RIJ. "But the bad news is not unaddressable."
The View from the Income Summit
Wed, May 26, 2010
At the Lifetime Income Summit in Washington last week, federal officials and financial industry executives amiably swapped views. But competitive tensions lay not far beneath the surface. Rep. Earl Pomeroy, D-ND (at left), was a featured speaker.
Who’s Winning the Rollover War?
Wed, May 26, 2010
IRAs now hold more money than employer-sponsored retirement plans, and the big beneficiaries are Fidelity, Vanguard and Charles Schwab, says a report from Cogent Research.
A Jolly View of Financial Folly
Wed, Jun 02, 2010
"Retirementology," a new book by Jackson National Life executive Greg Salsbury, Ph.D., approaches the serious topic of retirement planning in a mordantly funny way.
You May Live in Interesting Times
Wed, Jun 02, 2010
Interest rate risk keeps us all in suspense. Here’s how executives at Vanguard, New York Life, Delta Global Advisors, Prudential Annuities, and Loomis, Sayles cope with the uncertainty.
How Retirees Can Spend More Early (And Safely)
Wed, Jun 09, 2010
Bill Klinger's decumulation method involves techniques for moving payout rates up or down in response to market fluctuations. The New Jersey professor has also created the Retirement Quant planning tool.
The ‘Senior’ Senator from Wisconsin
Wed, Jun 09, 2010
The soft-spoken Herb Kohl (D-WI) fights for retirees as chairman of the Senate Special Committee on Aging, which will hold hearings on retirement income June 16.
The Sure Thing vs. The Gamble
Wed, Jun 09, 2010
There may be a certain futility to creating supposedly win-win products for a market that thrives by generating losers and winners.
A Jolly View of Financial Folly
Wed, Jun 02, 2010
"Retirementology," a new book by Jackson National Life executive Greg Salsbury, Ph.D., approaches the serious topic of retirement planning in a mordantly funny way.
Loaded VAs Haven’t Lost Their Lustre
Thu, Jun 17, 2010
Prudential Financial and Jackson National Life rack up sales with variable annuity contracts that ignore the adage, ‘Simplify, simplify, simplify.’
Our First Annual VA Special Editions
Wed, Jun 16, 2010
This week, we focus on the latest products and sales trends. Next week, we’ll delve into the issues that cloud the variable annuity industry's future.
The Year of Living Less Dangerously
Thu, Jun 17, 2010
A year or more after the financial crisis, major VA annuity issuers are trying to do more with less—less risk, that is. Here are nine of the latest efforts.
“What Investors Really Want”
Tue, Sep 07, 2010
That’s the name of behavioral economist Meir Statman’s new book. We all yearn for upside potential and downside protection—and maybe a weekly Lotto ticket, he says.
Reflections of a VA-Selling Advisor
Tue, Jun 22, 2010
Jay Hauenstein, a dually-licensed advisor in Mississippi who manages about $10 million in VA assets, looks for contracts with strong roll-ups and death benefits.
Plugging Leaks in VA Guarantees
Wed, Jun 23, 2010
VA issuers can’t keep bearing so many of the contract risks. Milliman's Ken Mungan (above) and Deep Patel suggest three ways to make VA manufacturing more sustainable.
New VA Contracts from Smaller Issuers
Wed, Jun 23, 2010
After highlighting new VA contracts from big issuers last week, we now turn to four new products from second-tier or regional insurers, all of them with sturdy A-level strength ratings from Moody’s, Fitch and Standard & Poor’s.
"Too Good to Last"
Thu, Jul 01, 2010
Curiosity about investments in secondary market annuities, which earn up to 9%, is growing. But these “factored products” are scarce—and virtually unregulated.
How Many VA Owners Will Bail Out?
Tue, Jun 29, 2010
Issuers of variable annuities with income benefits could face lower-than-expected lapse rates and higher reserve requirements over the next 18 months, says Oliver Wyman.
Mr. Smith Goes to the Patent Office
Wed, Jul 07, 2010
An actuary-turned-entrepreneur claims to have invented a cheap, benign, versatile new income distribution tool. But he’s coyly cryptic about its secret sauce.
On Second Thought, Make That a Single-Dip
Wed, Jul 14, 2010
Vanguard analysts put the chance of a double-dip recession at about 20%. The bond yield curve suggests only a 6% risk, but the yield curve isn't as reliably predictive as it used to be, they say.
They're Relatively Well-Off
Sun, Jul 18, 2010
The median annual income for people over age 65 in the United States is only $18,000, including public assistance and financial help from friends and family. The average—skewed upward by the highest incomes—is almost $29,000.
The Brilliant Gimmickry of TDFs
Sun, Jul 18, 2010
TDFs have always been a sales strategy more than an investment strategy, and we should recognize that.
Reish & Reicher Comment on TDF Proposals
Sun, Jul 18, 2010
“We expect that the SEC proposals will be adopted much as proposed," says Fred Reish, the well-known ERISA lawyer. But a TDF expert says plan fiduciaries should do more than merely comply with them.
The Gospel of Matthew Hutcheson
Mon, Aug 02, 2010
The 40-year-old leader of the “independent fiduciary movement” is passionate about making retirement plans more responsive to the needs of participants.
Inflation-Indexed and Level Payout Funds from Barclays Bank
Tue, Aug 03, 2010
“It's marketed as a gap product, such as between early retirement and pension benefits or to bridge until longevity insurance kicks in,” said Tamiko Toland, an annuity industry analyst at Strategic Insight, Inc.
Independent Fiduciaries to the Rescue
Tue, Aug 03, 2010
With his National Retirement Security Plan, independent fiduciary Matthew Hutcheson hopes to bring lower fees, better management to small and micro retirement plans.
The Downside of Upping the Retirement Age
Tue, Aug 10, 2010
Social Security turns 75 on Saturday, and pressure to raise the claiming age for full benefits is rising. But that would hurt the least well-off most, said experts at the Retirement Research Consortium meeting in Washington last week.
Your Loophole Is My Noose
Tue, Aug 10, 2010
Tax breaks, when seen as passive spending programs, are a form of government waste. So raising taxes might shrink the size of government. Or not.
Which Are the Hottest VA Brands?
Fri, Aug 13, 2010
Who do advisors think of first when asked to name a variable annuity provider? The just-published 2010 Advisor Brandscape from Cogent Research reveals that and much more.
Why the Wealthy Should Buy SPIAs
Tue, Aug 17, 2010
A recent study by a doctoral candidate at the University of Virginia examines all of the reasons why people don't buy income annuities--and reveals two hidden reasons why they should.
Transamerica Launches "Bridge" GLWB
Tue, Aug 17, 2010
The new Income Link rider pays out between 5% and 10% of the income base for a few years, then 4% for life. "It's designed for higher income in the near-term," says Dave Paulsen, Transamerica's national sales manager.
Financial Engines' Secret Income Plan
Tue, Aug 24, 2010
Financial Engines CEO Jeff Maggioncalda expects his firm to roll out an in-plan income option to DC participants in late 2010 or early 2011. He won't reveal details, but there are clues to his intentions. Photo by Robyn Basso.
Making The Case for Fixed Indexed Annuities
Tue, Aug 24, 2010
Jack Marrion and friends offer hard evidence that FIAs pay off when other investments don't. Their analysis is compelling, but I'm not ready to convert.
Imperfect Harmony
Tue, Aug 31, 2010
Hundreds of riled-up advisors and brokers, including Harold Evensky, have responded to the SEC's RFI on "harmonizing" their standards of conduct. Here's some of what they wrote.
My Tailor, My Fiduciary
Tue, Aug 31, 2010
The SEC could help investors distinguish between bespoke advice and off-the-rack advice that’s merely “suitable.”
The Big Red Stag's Mistake
Wed, Sep 08, 2010
In ordinary times, The Hartford's letter-gate problem might vanish quickly. But investors are nervous, a big election is coming up, and the reputation of the financial services industry is fragile. A cap-gun could set off a panic.
Making a Case for the 401(k) Annuity
Tue, Sep 14, 2010
Executives from major plan providers, including Christine Marcks, president of Prudential Retirement, along with trade group officials and ERISA experts, pitched ideas about in-plan income options at DoL/Treasury Department hearings Tuesday and Wednesday.
The Pros and Cons of 401(k) Annuities
Thu, Sep 16, 2010
One witness at the DoL/Treasury hearings this week asserted that mandatory annuitization of DC assets at retirement is needed. The government, as well as sponsors and plan providers, have largely ruled that out.
Eight Ways to Simplify Retirement Accounts
Wed, Sep 15, 2010
The government “spends” $118 billion a year on tax-deferred accounts whose complexities discourage many people from using them, according to the President's Economic Recovery Advisory Board.
In Search of Safe Harbors
Wed, Sep 15, 2010
At this week’s hearing on in-plan income options, industry executives asked the DoL for several kinds of regulatory relief—especially a safer ‘safe harbor.’
In-Plan Income, the Mutual of Omaha Way
Tue, Sep 21, 2010
Mutual of Omaha, in a program led by retirement plans product leader Tim Bormann, offers a deferred income annuity option called the Lifetime Guaranteed Income Account to small and micro plan sponsors.
Gorilla Marketing
Tue, Sep 28, 2010
In Manhattan and at the Jersey shore, AXA-Equitable Life staffers with a Flip camera interviewed passersby about retirement and posted the videos on YouTube. One man's retirement strategy: Meet a wealthy woman.
A Fortune in Reversals
Mon, Oct 04, 2010
New federal reverse mortgage rules make it cheaper for seniors to tap their home equity for a line of credit.
Retirement Income 'Smackdown'
Tue, Oct 12, 2010
In a three-way competition at the CFDD conference, the winning income plan was one that maximized Social Security, converted a 401(k) to a Roth IRA, and rebalanced the remaining portfolio monthly.
How to Reach the Middle Class Investor
Wed, Oct 13, 2010
The Society of Actuaries has issued two new papers, one that shows advisors how to create income plans for non-affluent retirees and one that explains why the middle-class shuns advisors.
A New Designation Is Born: the RMA
Wed, Oct 13, 2010
The Retirement Income Industry Association (RIIA) announced the first recipients of its Retirement Management Analyst designation at its annual meeting last week.
Plan Experts Like Annuities
Thu, Oct 21, 2010
In a workshop at this week's ASPPA annual meeting in Washington, D.C., few third-party administrators believed that the average couple will be able to afford the retirement they dream of. Many people, they said (including themselves), will need annuities.
Singapore Mandates Annuities
Thu, Oct 21, 2010
The government of this tiny Asian nation has confronted its collective longevity risk by requiring the purchase of annuities with defined contribution assets. Wharton pension expert Olivia Mitchell and colleagues have written a new paper about it.
A New Brand of VA Conference
Wed, Oct 27, 2010
Under Cathy Weatherford’s command, the IRI annual conference has become smaller, more strategic, less tactical, and more Washington-oriented.
A Case of Election Psychosis
Wed, Oct 27, 2010
“Doc, I can’t sleep. I stay up all night, trying to figure out who I should vote for,” said the Undecided Voter as he reclined on the leather longue...
How the Tax Stalemate Might Play Out
Wed, Oct 27, 2010
President Obama has left open the possibility of capping the tax on dividend income at 20%, says tax pundit Andy Friedman, but that would cost the government an estimated $100 billion in tax receipts.
Good Day at BlackRock
Mon, Nov 01, 2010
BlackRock will use the SPARK Institute's new IT standards to deliver the LifePath in-plan income solution--a deferred income annuity in a target-date fund of funds. “That’s a very important step in the evolution of these products in the marketplace,” said BlackRock's Chip Castille (above).
End the Bush Tax Cuts
Wed, Nov 03, 2010
If we're serious about reducing the deficit and sparing our grandchildren a legacy of debt, it would be irresponsible to do anything else.
How to End 'Annuicide'
Tue, May 24, 2011
Compensation-wise, income annuities can backfire for many advisors. An industry committee wants to solve the problem, but it’s not easy.
Singing from the Fee-Only Song Book
Wed, Nov 10, 2010
Given their focus on planning rather than sales, fee-only advisors seem well-suited to the labor-intensive process of creating customized retirement income solutions for their clients.
Vox Populi on the 'Volcker Rule'
Thu, Nov 11, 2010
More than 1,400 Americans, including Paul Volcker himself (at left) commented on the proposed rule, which would ban risky 'proprietary' trading by banks. A smaller but more influential group—including insurers and the probable next chair of the House Committee on Financial Services—decried the rule.
The $1.1 Trillion Tax Hike
Wed, Nov 17, 2010
The "Zero Plan" proposed by the co-chairs of the National Commission on Fiscal Responsibility and Reform last week calls for the end of $1.1 trillion in tax breaks. The co-chairs would save Social Security through a combination of reduced benefits and higher taxes.
How to Expect the Unexpected (in a Retirement Income Plan)
Wed, Nov 17, 2010
If you incorporated the risk of expensive emergencies, the sustainable withdrawal rate would sink to 3%, writes Gordon B. Pye, Ph.D., in the current issue of the Journal of Financial Planning.
An Entrepreneur Tackles Decumulation, with TIPS
Tue, Nov 23, 2010
Manish Malhotra’s FIAP platform, set to launch next year, will enable advisors to build retirement income streams out of laddered TIPS, immediate annuities, and withdrawals from balanced portfolios.
Decumulation Beat
Tue, Nov 23, 2010
Only advisors who are self-employed have the autonomy to use the fiduciary standard when working with clients.
AllianceBernstein’s Multi-Insurer In-Plan Annuity
Tue, Nov 30, 2010
To make sure that the glide paths of plan participants' TDFs lead to a 'safe landing,' asset manager AllianceBernstein has enlisted three insurers--AXA Equitable, Lincoln and Nationwide--to equip them with stand-alone living benefits.
The Point Person for 'Secure Retirement Strategies'
Tue, Nov 30, 2010
Mark N. Fortier, CFA, head of Product and Partner Strategy at AllianceBernstein, has led a team that spent much of the past three years building a multi-insurer platform to provide in-plan income solutions for large DC plan sponsors.
Why Prudential Sells the Most VAs
Wed, Dec 08, 2010
Constant proportion portfolio insurance, or CPPI, has helped Prudential attract crowds to its Highest Daily VA. Now other insurers are wondering if they should employ CPPI.
RIJ’s Top Ten List for 2010
Wed, Dec 22, 2010
Letterman, look out. Retirement Income Journal offers its own list of the year's highlights in the retirement income industry (or in one person's small corner of it).
The Tax Deal Feels Wrong
Tue, Dec 07, 2010
Over the weekend, retirees may have lost the first battle of the generational war.
Rep. Ryan’s Express Could Save—or Derail—Public Pensions
Tue, Dec 14, 2010
Perhaps the most pointed aspect of the bill, H.R. 6484, is its requirement that states use Treasury rates, which are historically low, to discount pension obligations and calculate funding requirements.
Sun Life’s New VA Riders Have New Risk Controls
Wed, Dec 15, 2010
Steve Deschenes, senior vice president and general manager for annuities at Sun Life Financial (U.S.), told RIJ, “This is not re-starting the variable annuity arms race. It’s a prudent tradeoff between risk management” and attractive guarantees.
Moral Hazard and the Roots of the Financial Crisis
Wed, Dec 22, 2010
Which caused the financial crisis? A minority report from the Financial Crisis Inquiry Commission and a forthcoming book from economists at NYU try to explain.
A ‘Turbit’ Drawdown Strategy
Tue, Dec 28, 2010
In a recent paper, two Vanguard CFPs detail the merits of a hybrid between the ‘turtle’ and the ‘rabbit’ approaches to decumulation.
A New Cylinder for Financial Engines
Wed, Feb 02, 2011
Income+, a process-driven, product-neutral income program for 401(k) managed account clients, could alter the competitive landscape of the retirement industry.
A Roundup of Crisis-Related Research
Wed, Jan 05, 2011
Here are summaries of some of the newest work published by the Center for Retirement Research at Boston College.
Four Drawdown Methods Compared
Wed, Jan 05, 2011
In his new book on the decline of defined benefit pensions, George "Sandy" Mackenzie also compares four non-insured retirement income strategies and chooses the best of a flawed lot.
Genworth Exits the VA Race
Tue, Jan 11, 2011
“They’re editing their lineup,” said Eric Berg, an analyst at Barclays Capital. “They’re getting out of the businesses where they lack meaningful size." (Above, Genworth CEO Mike Fraizer.)
Are Direct-Sold Funds a Better Value?
Wed, Jan 12, 2011
New research argues that broker-sold mutual funds—both active and passive—tend to generate lower returns at higher costs than direct-sold mutual funds.
A Death in the Family, Part I
Wed, Jan 19, 2011
For the very old and their families, preservation of life often competes with preservation of finances. Here's how one California family coped with an elderly mother's death. (The first of two parts.)
The 800-pound Irony of TDFs
Wed, Jan 19, 2011
The DoL wants TDF managers to disclose more information to plan participants. But the real problem may lie with plan fiduciaries, and current TDF designs.
A Death in the Family, Part II
Tue, Jan 25, 2011
Forget "death panels." Loving, decisive words from a doctor helped this dying pianist decide to let go of her life. The conclusion of a two-part story.
SEC Staff Recommends Uniform Fiduciary Standard
Wed, Jan 26, 2011
All those who give “personalized investment advice about securities to retail customers” should put the clients' interest above their own, the SEC staff recommends.
Gimme Shelter
Wed, Feb 02, 2011
The autobiography of Rolling Stones guitarist Keith Richards and the report of the Financial Crisis Inquiry Commission have a few things in common.
A Closer Look at “Income+”
Thu, Feb 03, 2011
Financial Engines CIO Chris Jones answers questions about his firm’s new in-plan income program.
The New 'Big O'?
Tue, Feb 08, 2011
The revelation of a novel share class of variable annuities--its working title is "O" shares--was perhaps the most interesting piece of news that emerged from the IRI Marketing conference in Washington, D.C., last week.
A Guide for the Perplexed Participant
Wed, Feb 16, 2011
GuidedChoice is the latest 401(k) advice provider to announce a platform that helps participants turn their savings into income—with or without a rollover to an IRA. (Above: CEO Sherrie Grabot.)
LPL Taps Five Insurers for New VA Platform
Tue, Feb 22, 2011
Advisors who use LPL Financial’s new Fee-Based Variable Annuity platform can manage VA subaccounts just like mutual funds. (Photo at LPL’s San Diego office.)
Will New Retirees Rush to Spend Their Savings?
Wed, Feb 23, 2011
A study by MIT's James Poterba (left) and others shows that current retirees tend to hoard 401(k) and traditional IRA assets, along with home equity, against possible future emergencies.
Wedding Bells for TIPS and ALDA
Tue, Mar 01, 2011
Together, PIMCO's TIPS-based managed payout funds and MetLife's longevity insurance mitigate two big retirement risks: inflation risk and the risk of outliving one’s savings.
Morningstar’s ‘Secret Sauce’
Tue, Mar 08, 2011
Speaking at the 2011 Morningstar/Ibbotson Conference in Orlando, Roger Ibbotson (above) described low-liquidity as a largely unrecognized source of alpha in stocks and mutual funds.
In 2010, VA Industry Thrived and Consolidated
Wed, Mar 09, 2011
Of $136.6 billion in total sales, $21.5 billion represented new cash flow, up from $17 billion in 2009. But the net cash flow was the third lowest in 12 years, after 2005’s net flow of $20.4 billion.
Take the ‘Gauss’ Work Out of Saving
Tue, Mar 15, 2011
Using "non-Gaussian" analysis, Jim Otar has created a benchmark for evaluating retirement savings vehicles--and discovered that cautious savers might want to hold fewer equities.
Putnam's Man with a Plan
Wed, Mar 23, 2011
Putnam Investments CEO Robert Reynolds called for a new lifetime income regulatory body and announced a decumulation tool for Putnam funds in a speech at the RIIA meeting this week.
RIIA 'Gets' Open Architecture
Wed, Mar 23, 2011
Few organizations seem to understand the ascendancy of "open architecture" better than the Retirement Income Industry Association, whose mantra is "the view across the silos." Here's a report on its Spring Conference, held this week.
RIIA Marks a Few Milestones
Thu, Mar 24, 2011
The Retirement Income Industry Association, led by Francois Gadenne, has published the third edition of the text for its RMA certification program, and the first issue of The Retirement Management Journal.
Did Income Inequality Cause the Crisis?
Tue, Mar 29, 2011
Those with surplus money naturally lend to those who need money. But, as two IMF experts show, disaster can occur when too much money is lent for consumption and the process goes on too long.
When Herds Get Overconfident, Run for Cover
Tue, Mar 29, 2011
Steve Utkus of the Vanguard Retirement Research Center proposes a four-part model to explain the psychological dynamics behind the most recent financial bubble, and similar bubbles.
Plan Sponsor Group Joins Hueler SPIA Platform
Wed, Apr 06, 2011
The deal will allow the 1,200 members of the Profit-Sharing Council of America to give their six million plan participants access to a no-load, multi-issuer SPIA platform. (Photo of Kelli Hueler by David Lubarsky).
How To Market to Advisors
Sun, Apr 10, 2011
Here's a smarter way for retirement income product manufacturers to segment and sell into the advisor market, according to survey analysts Howard Schneider of GDC Research and Dennis Gallant of Practical Perspectives.
America Isn't a Corporation
Mon, Apr 11, 2011
Congressman Paul Ryan's approach to the budget makes sense only if you think America should function like a corporation and that Medicare payments are income for beneficiaries. Nix to both ideas.
An Industry Awaits Fee Transparency Rule with Trepidation
Tue, Apr 19, 2011
“This new ERISA 408(b)(2) disclosure has a bite to it," writes Louis Harvey of Dalbar in DSG Dimensions. ERISA attorney Fred Reish (left) estimates that 401(k) fee transparency rule would be effective "April 1 to July 1, 2012.”
More info on New York Life's DIA Emerges
Wed, Apr 20, 2011
The deferred income annuity will allow pre-retirees to build up retirement income over time, it was revealed at the LIMRA Retirement Industry conference in Las Vegas last week.
Understanding the Black Investor
Tue, Apr 26, 2011
African Americans in general have fewer assets, less faith in Wall Street and less appetite for risk than whites, but their need for financial guidance is arguably that much greater.
A Scholar's Perspective
Tue, Apr 26, 2011
"It’s not as if African Americans were a different species. They are over-represented among lower income populations, but that’s where their distinctiveness stops,” said Wilhelmina A. Leigh, Ph.D., of the Joint Center for Political and Economic Studies.
An Advisor's Perspective
Wed, Apr 27, 2011
Antoine Orr, president of Plancorr Wealth Management LLC in Greenbelt, Maryland, tells his clients to pay down debt and invest only what they can afford to lose. "African American wealth is more abundant than people think," he says.
A Month of SPIAs
Tue, May 03, 2011
Starting with today’s issue, we’ll devote four weeks of cover stories and features to single premium immediate annuities. Millions of mass=affluent Americans will need them.
Prudential, Edward Jones in VA distribution deal
Wed, May 04, 2011
Prudential has created a cost structure for its top-selling VA that satisfies the broker's client-focus. At left, Merry Mosbacher of Edward Jones.
Most tax benefits of private pensions go to high earners: GAO
Tue, May 10, 2011
The largest share of 401(k) assets is clustered in big accounts, and the highest-earning participants reap the most tax benefits, says a GAO study. The CEO of ASPPA, a plan administrator group, says the study is wrong.
Channel Surfing for Low-Cost SPIAs
Tue, May 10, 2011
Where can you find lowest SPIA prices on the web? RIJ compared prices at Immediateannuites, Income Solutions, Fidelity and (as a benchmark) Cannex. And the winner was...
What’s Up Down Under? SPIA Sales.
Wed, May 11, 2011
An ad campaign featuring the 1967 Buffalo Springfield classic, "For What It's Worth," and other factors are helping drive higher income annuity sales in Australia for Challenger Ltd. Their latest product offers liquidity in the first 15 years.
MassMutual Rediscovers the Immediate Annuity
Tue, May 17, 2011
A few years ago, MassMutual mothballed Jerry Golden’s SPIA tool for advisors. Now, post-crisis, the company has re-embraced SPIAs, and sales are up.
Speculation About Jackson National
Tue, May 17, 2011
If Jackson National de-risks its variable annuity offerings, it would merely be following the example of competitors like Prudential and MetLife. Jackson's parent also has to consider Solvency II.
Always Protect Your Story
Tue, May 24, 2011
Two weeks ago, when Prudential plc's CEO told analysts that he envisioned unspecified risk reductions in Jackson National's VA by end of year, he clearly didn’t realize that his statement could muddy Jackson's well-honed "story."
Reading the Minds of the Affluent
Wed, May 25, 2011
Cogent Research has tapped into the attitudes of wealthy retirees and pre-retirees toward retirement income products.
Do VA ‘Roll-Ups’ Have the Desired Effect?
Tue, Aug 02, 2011
Deferral bonuses, a key feature of many VAs, may not prevent contract owners from taking withdrawals, according to Milliman’s latest survey of issuers of VA guaranteed living benefits. Photo courtesy of Whimsicalwhisk.com.
Who’s Afraid of the Big Bad Debt?
Tue, May 31, 2011
Not Warren Mosler, bond trader, racecar dabbler, Senatorial candidate and recent author of “The Seven Deadly Innocent Frauds.”
A Hub Named RICC
Tue, May 31, 2011
DST Systems’ Larry Kiefer says his firm’s new “middleware” simplifies the distribution of lifetime income products to plan participants, IRA owners and others.
Heritage Foundation Suggests Means-Testing for Social Security, Medicare
Wed, Jun 01, 2011
Under the conservative think-tank's proposal, a new optional, auto-enrolled savings plan would start in 2014. Under this plan, 6% of each worker’s income would go in a retirement savings plan that the worker owns and controls.
At Your Service: Courting the Affluent Tennis Fan
Tue, Jun 07, 2011
Prudential Financial, Raymond James, ING, Fidelity Investments and E*Trade all advertised during the French Open final between Rafael Nadal (above) and Roger Federer on NBC TV last Sunday--all vying for the "elite demographic" that follows tennis.
Let's Not Panic Over the Deficit
Wed, Jun 08, 2011
“The current weak state of many economies argues against implementing budget cuts in the next couple of years,” says a new pamphlet from the Peterson Institute for International Economics.
At SPARK conference, a Plug for In-Plan Annuities
Wed, Jun 15, 2011
In touting his firm's LifePath TDF-based deferred income option, Chip Castille of BlackRock emphasized that insurers should position in-plan annuities as retirement income enhancers rather than longevity risk mitigators. (I.e., appeal to greed, not fear.)
Annuities, Sudden Darlings of the Media
Mon, Jun 20, 2011
Positive articles about annuities are certainly welcome—especially at a time when a relentless interest-rate drought is desiccating their value—but recent pieces in Barron's and the New York Times didn't advance the annuity dialogue very far.
SPIA Flow at Fidelity: $70M-a-Month
Tue, Jun 21, 2011
Sales began going up after Fidelity incorporated SPIAs into its online retirement planning tools: the Income Strategy Evaluator and the Guaranteed Income Estimator.
Putnam, A Work in Progress
Wed, Jun 29, 2011
With the announcement of a retirement research center, Putnam Investments joins the "thought-leadership" game. It's all part of CEO Bob Reynolds' campaign to rebuild a tarnished brand--and to change the way America saves.
Things Heard and Overheard
Wed, Jun 29, 2011
Here's a follow-up on our earlier report on the recent SPARK conference, with more news and comment about DoL enforcement strategy, the threat to the tax deferral for savings, and what might happen when participants see how much their plans cost.
VAs: In Search of a Winning Formula
Tue, Jul 05, 2011
VA issuers should take a cue from Michael Jordan, and realize that team players win more championships than individual stars, advises Bing Waldert of Cerulli Associates.
It’s July, So We Must Be in VA-VA-Land
Tue, Jul 05, 2011
Welcome to Retirement Income Journal’s Variable Annuity Month. We’re devoting all four of our weekly issues in July to the promise and the problems of variable annuities.
An Actuary’s View of the VA Market
Wed, Jul 06, 2011
Consulting actuary Tim Pfeifer, a self-professed fan of the guaranteed lifetime withdrawal benefit, spoke with RIJ about the evolving variable annuity market.
The Stag Brings Back GLWBs
Tue, Jul 12, 2011
In an about-face on VAs, The Hartford has gone back to the GLWB, tempering its risks with a CPPI fund. The arrival of Steve Kluever from Jackson National in March reflects the new thinking.
A Modest Proposal
Tue, Aug 02, 2011
Americans used to help their government by buying government bonds. I think we can solve our current debt problem by tearing up our government bonds!
The Journal Plays Gotcha! with EBRI
Tue, Jul 12, 2011
In a July 7 article, the Wall Street Journal reported that auto-enrollment in 401(k) plans has backfired, sticking some people at a lower contribution rate than they might have elected. In its desire for a man-bites-dog story, the Journal overreached.
NYLife Targets VA Buyers with New DIA
Wed, Jul 13, 2011
The new multi-premium contract allows a person to build a personal pension with a series of contributions leading to lifetime income beginning at a pre-determined but flexible start date.
Dark Horse Candidate
Tue, Jul 19, 2011
How did upstart Jackson National Life get near the top of the VA heap? And why are so many advisors nervous that it may 'de-risk' its popular Perspective contract? JNL EVP Clifford Jack tells RIJ all that he can...
Mutual Satisfaction
Wed, Jul 20, 2011
What "story" helps you sell VAs? Mark Caner of Western & Southern describes his firm's contract as a safe, nimble, fuel-efficient vehicle for cruising through retirement.
A Pair of VA Contenders
Tue, Jul 26, 2011
Big deferral bonuses and safer investment options characterize the income riders of Nationwide and Sun Life, both of which aim to be among the leading sellers of VAs.
A New Arm for a New VA Arms Race
Wed, Jul 27, 2011
AllianceBernstein's DAA fund, which aims for 60/40 performance without the tails, has been adopted as a risk-reduced investment option in AXA, MetLife, Ohio National, Sun Life, and Transamerica variable annuities. AB's Mark Hamilton explains.
A New Arm for a New VA Arms Race
Fri, Aug 05, 2011
AllianceBernstein's DAA fund, which aims for 60/40 performance without the tails, has been adopted as a risk-reduced investment option in AXA, MetLife, Ohio National, Sun Life, and Transamerica variable annuities. AB's Mark Hamilton (below) explains.
Breakthroughs in Behavioral Finance
Mon, Aug 08, 2011
As an advisor, you can actually put clients in an annuity 'frame of mind.' These and other findings from behavioral finance research were presented at the 2011 Boulder Summer Conference on Consumer Financial Decision-Making last June.
Happy Ants, Struggling Grasshoppers
Tue, Aug 09, 2011
SunAmerica's 'Retirement Re-Set' study showed why some retirees are happier than others. Jana Greer, president and CEO of SunAmerica Retirement Markets, explains. The company was the sixth biggest VA-seller in 1Q 2011.
They Know Not What They Do
Tue, Aug 09, 2011
The equity sell-off and rush to Treasuries didn't happen because Congress failed to cut the deficit or the debt aggressively enough. In my humble opinion, it happened for the opposite reason.
A Reference Work Built for You
Fri, Aug 12, 2011
The Society of Actuaries' recent book (available here in pdf form) puts the reader at the center of a web of hundreds of articles, research studies, other resources relevant to the risks and opportunities of Boomer retirement.
East and West Approach Retirement from Opposite Directions
Mon, Aug 15, 2011
Starting from a level of great wealth, North Americans and Europeans feel a sense of decline, while Asians, starting from a level of deep poverty, feel a sense of upward mobility and optimism, according to a recent global survey by HSBC.
Micro-Pensions in Central America
Tue, Aug 23, 2011
You've heard of micro-credit: those mini-loans to female entrepreneurs in emerging markets. Now a micro-pension movement is underway, and one of the first pilot projects starts next month in Guatemala, Honduras and Nicaragua. Part I of a two-part article.
Does Decumulation Spell Doom?
Tue, Aug 23, 2011
Economists at the San Francisco Fed suggest that P/E ratios are bound to suffer as the Boomer cohort gets older and liquidates its assets.
Actuaries Without Borders... Why Not?
Tue, Aug 30, 2011
Experts from Aegon Global Pensions, De Nederlandsche Bank and other Dutch pension and financial consulting firms are helping the Amsterdam-based P&D Network plant the seeds for "micropension" programs in the developing world. The final part of a two-part series.
The Secret to MetLife's VA Success
Wed, Aug 31, 2011
MetLife was able to knock off Prudential as the top seller of variable annuities in the second quarter because it de-risked its income benefit in a way that actually improved its marketing story.
Fishing for Trout, and for the Perfect Retirement
Tue, Sep 13, 2011
While vacationing in the upper Rio Grande Valley this summer, I caught two good-sized trout and a glimpse of my fantasy retirement. (Photo of the author by Lisa Higgins).
Advisor Survey Provides Mixed News for Annuity Providers
Tue, Sep 13, 2011
Cogent Research's 2011 Advisor Brandscape survey shows that many advisors sell annuities and are highly loyal to certain variable annuity providers. But on average they don't devote much of their clients' assets to annuities--and don't plan to in the future. At left, Cogent principal John Meunier.
Political Football
Tue, Sep 20, 2011
The Dept. of Labor's bid to strengthen the fiduciary standard for advisers to retirement plans and IRAs became a political football. Now the DoL has agreed to revise and "re-propose" its proposal. Was the football fumbled... or stripped?
No-Shows at the Trade Show
Tue, Sep 20, 2011
At the Financial Planning Association Experience 2011 meeting in San Diego last week, a couple of thousand financial advisors were on hand. So why the dearth of exhibits by annuity issuers?
Investment Myths Debunked
Wed, Sep 21, 2011
Rod Greenshields of Russell Investments questioned the value of conventional financial wisdom in a lively presentation at the FPA Experience 2011 conference.
Introducing the Virtual RIA
Tue, Sep 27, 2011
Internet start-up Personal Capital is out to prove that mutual funds and face-to-face financial advice are obsolete. (At center, CEO Bill Harris, with Jim Del Favero, VP, product management (seated) and Ehsan Lavassani, engineering director.
401(k) Reforms: More Enviable Than Viable
Wed, Sep 28, 2011
Proponents of 401(k) reform met defenders of the status quo in a Senate Finance Committee hearing on Sept. 15. The reforms have some justification, but they could hurt the very people who decide whether to sponsor a plan or not.
'Boom Time' for Variable Annuities?
Wed, Oct 05, 2011
Guest speakers Fareed Zakaria (pictured) urged more fiscal stimulus for the economy while Andrew Friedman warned of looming tax hikes at the Insured Retirement Institute's conference in Boston. "Boom Time" was the conference theme this year.
Our Debt Won’t Bankrupt Our Grandkids
Wed, Oct 05, 2011
Deficit hawks say that federal debts and deficits put our progeny in a hole. Indeed, they've said it for decades. But some economists, starting as far back as 75 years ago, have said that's poppycock. The latter may be right.
United Technologies Adopts In-Plan Annuity
Wed, Oct 05, 2011
After overhauling its huge retirement plans, this Fortune 50 firm selected AllianceBernstein's stand-alone living benefit as its in-plan 401(k) income option. AXA Equitable, Nationwide, and Lincoln Financial were expected to support the lifetime guarantee.
RSQ-y Business at John Hancock B/D
Wed, Oct 12, 2011
John Hancock Financial Network will offer its advisors the Retirement Sustainability Quotient, an income planning tool that Moshe Milevsky (pictured) developed for ManuLife Financial, JHFN's Canadian parent.
The Scoop on Pre-Owned Annuities
Wed, Oct 12, 2011
When buying a secondary-market annuity that offers a 7% or 8% effective rate of return, make sure you deal with honest brokers.
In Denim or in Suits, New Yorkers Want Market Reform
Sun, Oct 16, 2011
An 'Occupy Wall Street' protester at New York's Zuccotti Park expresses her opinion. The same day, at the NY Athletic Club, Wall Streeters themselves criticized their own industry.
It’s Back: The Hartford’s In-Plan Income Annuity
Wed, Oct 19, 2011
With United Technologies' recent adoption of an in-plan annuity, it now appears more likely that guaranteed income will eventually become commonplace in the defined contribution space. The Hartford, after a false start, has jumped back in that game.
‘Decumulation is Like a Rubik’s Cube’
Tue, Oct 25, 2011
The Money Management Institute has identified 34 financial services firms that have created what it calls Personal Retirement Income Solution Management (PRISM) tools or programs.
“Income” Funds with High Price Tags
Wed, Oct 26, 2011
Unless I’ve missed something, the three Putnam Retirement Income Lifestyle Funds, as “income funds,” seem long on promises and short on delivery—particularly in light of the costs.
Money trumps sports in the hearts of men, survey shows
Wed, Oct 26, 2011
A plurality of men (40%) preferred to deposit an extra $1,000 into the emergency fund instead of contributing to their retirement fund or spending it on themselves or a significant other, according to a survey by ING DIRECT USA and Men's Health magazine.
Three Steps to Annuity-Free Income
Wed, Nov 02, 2011
For retirees who say, 'Don't sell me a product!', Thornburg Investment Management recommends a retirement income strategy built on 'endowment' spending, three buckets and its own dividend fund.
The Plot to Kill Social Security
Wed, Nov 02, 2011
Is it paranoid to believe that the assault on Social Security is orchestrated? Or is Halloween getting to me?
It’s a Twister, Auntie 'Ben'
Tue, Nov 08, 2011
U.S. life insurers can weather the impact of 'Operation Twist' for a few years, Moody’s Investors Service says. But another five-plus years of rock-bottom interest rates could damage profits and ratings.
Six Ways Insurers Can Fight Low Interest Rates
Tue, Nov 08, 2011
While forecasting a 10% decline in investment yields for life insurers due to Fed interest rate policy, Ernst & Young proposes six strategies firms can use to combat the impact of low rates. E&Y's Doug French (pictured) spoke with RIJ.
$10 million a week in sales for New York Life's deferred income annuity
Tue, Nov 08, 2011
Low CD rates and equity volatility may be helping sales of the Guaranteed Future Income Annuity, which has collected $100 million in premia since July to become NY Life's hottest launch ever.
MetLife Dominates 3Q VA Sales
Wed, Nov 30, 2011
Another “very bright spot in the third quarter data was the significant increase in net cash flow, to $8.9 billion from $5.7 billion in the second quarter and $6.4 billion in the third quarter of 2010,” wrote Frank O’Connor, product manager of the VA database at Morningstar.
Unlikely Rescuer
Sun, Nov 13, 2011
At least three proposals have been floated to open state pensions to private sector workers who have no retirement plan. Given the troubles of many state plans, that's counterintuitive. Artwork by Zaza Khabuliani.
Our Half-Full, Half-Empty Retirement Glass
Tue, Nov 15, 2011
The private DC system covers only about half of American workers at any given time. Proposals to open state pension plans to uncovered workers have been made, and the threat of competition may actually be healthy for the 401(k) system.
Airbag-Equipped Annuities
Tue, Nov 22, 2011
VA issuers may be able to offer rich living benefits safely and inexpensively by embedding a futures-based hedging strategy inside their investment options. That's what Ohio National seems to have done. (Image by Spectrumphotofile.)
Signature of the Times
Tue, Nov 22, 2011
After the report of a $900 million charge in the third quarter, Manulife’s decision to limit distribution of John Hancock annuities can’t have shocked many people.
The "Evolution of the Annuity Industry"
Tue, Nov 29, 2011
Like the Ford Mustang in 1965, the variable annuity with a lifetime income rider seemed like the right Boomer product at the right time in 2006. Then came the Crisis. A new survey by Cogent Research and the Insured Retirement Institute looks at where the VA is today and where it's headed.
What Income Planning Software Do You Use?
Wed, Nov 30, 2011
Calling all investment advisers and financial planners: RIJ wants to hear from you about the tools you use to help your clients create retirement income.
Do Motley Fool stock recommendations beat the market?
Wed, Dec 07, 2011
“A strategy of shorting stocks with a disproportionate number of negative picks on the site and buying stocks with a disproportionate number of positive picks produces a return of over 9 percent per annum over the sample period,” a National Bureau of Economic Research paper said.
Running Lapse around Variable Annuities
Wed, Dec 07, 2011
As the living benefits of variable annuities became more valuable during the financial crisis, contract owners astutely held on to them, according to a presentation by Ruark Consulting at a recent Society of Actuaries meeting in Chicago.
The Fees Ate My Savings
Wed, Dec 07, 2011
A gerontology professor argues in a new article that Americans’ 401(k) holdings are coming up trillions of dollars short, thanks to high investment management fees.
Sun Sets on Sun Life's U.S. Annuity Business
Wed, Dec 14, 2011
New CEO Dean Connor decided to cut Sun Life's losses in the U.S. annuity business after a third quarter that negatively impacted many U.S. annuity issuers. The Canadian firm will focus on its employee benefit and MFS Investment Management businesses in the U.S.
See you in the new year!
Mon, Dec 19, 2011
Retirement Income Journal will not appear on December 28, 2011, in observance of the Christmas holidays. The next issue will appear on January 4, 2012. To all our subscribers and readers, thank you for making 2011 our best year yet!
About those Embedded Derivatives
Tue, Dec 20, 2011
The variable annuity with a lifetime income benefit--sometimes known as an exotic put option or an embedded derivative--was a product that has come back to bite many of the companies that sold it. Was this product ever the best solution for the Boomer retirement challenge?
Searching for the Right Decumulation Tool
Tue, Jan 03, 2012
This month we'll be dedicating a fair amount of space to retirement income planning software tools.
The ‘Safety First’ Income Planner
Tue, Jan 10, 2012
Maryland advisor Antoine Orr couldn’t find an income planning tool that matched his low-risk, low-debt philosophy. So he created the Plancorr Planner.
The Missing Sockdolager
Tue, Jan 10, 2012
An article appeared yesterday under the headline, "Variable-annuity guarantees disappoint over time." I think the jury is still out on that.
Ohio National launches ‘Low-Vol’ VA options
Wed, Jan 11, 2012
"Going forward, I think the only sustainable product designs will be in the context of risk-levered funds,” said Steve Murphy, FSA, a senior vice president at the Cincinnati-based mutual insurer.
Lion's Share
Wed, Jan 18, 2012
ING U.S. Retirement will combine its own target date funds with the AllianceBernstein three-insurer annuity platform to offer a lifetime income option to its 52,000 small and mid-sized plans.
The Abandonment of an Ideal
Thu, Jan 19, 2012
The gulf between the reality of wealth distribution in America and our ideal wealth distribution is what the “one-percent” controversy is really about.
Sounds Like a Plan
Wed, Jan 25, 2012
A directory of 27 software tools accompanies this overview of the rapidly evolving financial planning technology industry.
Halfway Back to Prosperity?
Wed, Feb 01, 2012
Carmen Reinhart, co-author with Kenneth Rogoff of the best-selling "This Time Is Different," spoke at the IMCA conference in New York this week. We're five years into a 10-year recovery from the credit binge, she said.
The World of Retirement Research
Thu, Feb 02, 2012
We’re making retirement income research RIJ’s main topic for February.
The Best Retirement Research of 2011
Tue, Feb 07, 2012
What were the most significant decumulation research papers published last year? These ten articles can certainly claim to be among them.
Vocal reactions to the New 401(k) Rules
Wed, Feb 08, 2012
Professionals from across the retirement income industry express their views of the DoL/Treasury announcement last week on fee disclosure and annuities.
An Interview with David Wray
Wed, Feb 08, 2012
Don't expect participants to revolt when they see how high their 401k fees are, and don't expect 12b-1 fees to disappear, said the president of the PSCA. But the problem of 'fee bracket creep' should be fixed by new federal rules.
It's Conference Season
Wed, Feb 15, 2012
The approach of spring brings Grapefruit League baseball, income tax forms and a new parade of retirement industry-related conferences. We've updated our Events calendar just in time for the new season.
Patently Controversial
Tue, Feb 21, 2012
Lincoln National Life has received a new patent on its GLWB process, raising concerns that it might once again seek royalties from other VA issuers.
‘Field Research’ in Behavioral Finance
Mon, Feb 20, 2012
Real scientists scoff at the value of "anecdotal evidence." But you can learn a lot about the psychology of money at a garage sale, or when you're buying clothes.
The Income Expert
Wed, Feb 29, 2012
In this video, Mark J. Warshawsky, director of Retirement Research at Towers Watson, discusses his new book, Retirement Income (MIT Press, 2012) with RIJ editor Kerry Pechter. Their conversation focuses on the author's recommended strategy of buying a series of immediate annuities during retirement.
What Are Sales Trends Telling VA Issuers?
Wed, Feb 29, 2012
Investors were running scared after 3Q equity market turmoil. But they didn’t flock to variable annuity guarantees for protection.
The Financial World Is Round
Tue, Apr 17, 2012
I don’t necessarily agree with all the policy recommendations of Modern Monetary Theory proponents. But, for me, MMT helps explain much of what was previously inexplicable about our financial system.
Jackson Hits the Alt-Option Key
Tue, Mar 06, 2012
Jackson National Life's newest variable annuity contract, Elite Access, offers a variety of high-turnover alternative investment options inside a tax-deferred wrapper--and no living benefits.
Six Annuities for the Wealthy
Wed, Mar 07, 2012
Contrary to conventional wisdom, high net worth individuals can benefit from owning annuities. It just has to be the right kind of annuity.
Will RIAs Sing This ARIA?
Tue, Mar 13, 2012
ARIA Retirement Solutions and AEGON/Transamerica have created a stand-alone living benefit (SALB) for the $1.3 trillion managed account market.
Politicized Economist
Tue, Mar 13, 2012
Laurence Kotlikoff of Boston University, a member of the RIJ community, is running for president of the United States on a "purple" platform. But he's hardly middle-of-the-road.
Getting into the Heads of RIAs
Wed, Mar 14, 2012
Data on the views and practices of RIAs are included in a recent study co-authored by Howard Schneider (left), of Practical Perspectives and Dennis Gallant of GDC Research.
The Weird Math of Charitable Gift Annuities
Wed, Mar 21, 2012
Here's how the wealthy buy lifetime income while giving zip to insurance companies, a pittance to the IRS and--unless they live a very long time--a sizable gift to charity.
In Case You Missed the RIIA Conference
Wed, Mar 21, 2012
This year’s spring conference, held again at Morningstar headquarters in downtown Chicago, may have been RIIA's most substantive, timely and productive to date.
Will RIAs Sing This ARIA?
Thu, Mar 22, 2012
ARIA Retirement Solutions and AEGON/Transamerica have created a stand-alone living benefit (SALB) for the $1.3 trillion managed account market.
Mad Men
Tue, Mar 27, 2012
The leitmotif of the Retirement/Pension track of the Society of Actuaries Investment Symposium in New York on Monday was that risky assets and pensions mix like, say, metallic sodium and water. Explosively, that is.
Act V of the VA Drama
Wed, Mar 28, 2012
In an effort to de-risk its book of GMIB business, Transamerica Life is offering to buy back the benefit. And one firm, Achaean Financial, wants to help insurers convert some of their living benefits to immediate variable annuities. Is this the start of a trend?
Is This Any Way to Sell SPIAs? You Bet./
Wed, May 09, 2012
Kelli Hueler, creator of the Income Solutions online income annuity sales platform, delivered an academic paper at the Pension Research Council's annual conference at the Wharton School last week, and provided insight into her "out of plan" income option for rollovers from 401(k) plans.
Heat from the Street
Tue, Apr 03, 2012
At a vulnerable juncture in the evolution of their products, publicly-held VA issuers are feeling unprecedented pressure from Wall Street. That was made clear by speakers at the IRI Marketing Conference in New York this week.
A Reader Comments on the ARIA CDA
Tue, Apr 03, 2012
CFP Mark Cortazzo of MACRO Consulting Group says that the fee-assessment mechanism of the ARIA contingent deferred annuity taketh away even as the product's living benefit giveth.
Springtime is for SPIAs, Etc.
Tue, May 01, 2012
Here at RIJ, May is the month when we focus on income annuities. Expect to hear a lot about SPIAs, SPIVAs, DIAs, and/or ALDAs over the next several weeks.
The Crisis Behind the Crisis
Mon, Apr 09, 2012
A new report from Oliver Wyman examines the dysfunctional state of the global financial services industry. It blames asset-liability mismatching for a lot of the trouble, and suggests a return to simpler 'Volkswagen' banking.
The "Stacking" Strategy
Tue, Apr 17, 2012
Are bond yields awful? Are investors terrified of equities? Then it’s perfect weather for indexed annuities, the unpredictable but often effective knuckleballs of the annuity world. Check out these new "stacked" offerings from Security Benefit Life and Aviva.
The Bucketing Brigade
Tue, Apr 24, 2012
Pershing LLC, Sovereign Bank, and Securities America have all made Income for Life Model (IFLM) software available to advisors. That represents growth for IFLM, and progress for the income paradigm. (Sculpture by Stephane Cauchy.)
Macchia, the Man and the Machine
Tue, Apr 24, 2012
David Macchia, the president of Wealth2k and developer of Income for Life Model, keeps going and going and going... and thinking a lot about the Boomer retirement income opportunity.
Lounging by the (Mortality) Pool
Tue, May 01, 2012
The climate was ideal, but annuities upstaged sunbathing at the 2012 Retirement Industry Conference at Walt Disney World Resort in Orlando last week.
New Allianz Life VA income rider enhances withdrawal rate, not benefit base
Wed, May 02, 2012
Instead of tempting the client with a guaranteed rollup in the benefit base every year, Income Focus enhances the withdrawal rate. And, instead of guaranteeing that enhancement, Allianz Life makes it contingent on market gains.
Is This Any Way to Sell SPIAs? You Bet.
Wed, May 09, 2012
Kelli Hueler, creator of the Income Solutions online income annuity sales platform, delivered an academic paper at the Pension Research Council's annual conference at the Wharton School last week, and provided insight into her "out of plan" income option for rollovers from 401(k) plans.
Dept. of Ruffled Feathers
Tue, May 08, 2012
I suggested to Kelli Hueler that she has "ruffled some feathers" in the annuity business. The creator of Income Solutions was both surprised and not surprised to hear that.
Talking DIAs with Matt Grove of NY Life
Tue, May 15, 2012
NY Life launched its Guaranteed Future Income Annuity, a deferred income product, in mid-2011 and has found traction among pre-retirees who want income about 10 years later. We spoke about it with Matthew Grove, vice president of Guaranteed Lifetime Income at the mutual insurer.
No Tower of Babel, or Babble, from Babbel
Wed, May 16, 2012
If you're engaged in selling or marketing income annuities, you must read this 2007 white paper by Wharton professor David Babbel. It's an enduring classic.
