Seven questions that reveal financial biases
'Understanding clients' underlying biases and mitigating suboptimal investment decisions is critical for advisors in a digitally pervasive environment,” a Cerulli Associates report said.
Behavioral Finance
Research Roundup
Here's new research on tax avoidance among the very rich, the logic that millionaires use when buying equities, considerations for plan sponsors when estimating income from 401(k) balances, and...
How the pandemic affected indexed annuity owner behavior
'Given record low interest rates, and disruptions to sales channels, there was no way to know whether past patterns would continue. We’re intrigued by how some changed—and others didn’t,'...
Modeling Variable Annuity Owner Behavior
Americans own almost $900 billion worth of variable annuities with lifetime income guarantees. Uncertainty over the way policyholders and their advisers might use the contracts can keep life insurer...
Teach Your Brain to Handle Crises
How can you model calm in the midst of organization crisis? Kamila Sip and Jay Dixit of the Neuroleadership Institute explain how the brain processes stress.
‘Survival pessimism’ dulls the appetite for annuities
Those in their early 60s underestimate the chance of survival to 75 by more than 25 percentage points, on average, and those in their early 70s underestimate survival to...
At These Rates, Why Bother to Save?
Negative real interest rates have become a disincentive to personal savings, especially among lower-income Americans who will rely heavily on Social Security and Medicaid anyway, this team of economists...
Some investors ‘bet the farm’
Most respondents overestimate the probability of rare events, and underestimate the likelihood of more certain, but lower-value, payouts, according to a new paper from the National Bureau of Economic...
Playing the ‘Newlywed Game’ with near-retirement couples
Couples on the brink of retirement often have different ideas about retirement but not know it, according to a new research paper from academics in Canada and the Netherlands....
A ‘SideCar’ Account for UK Plan Participants
NEST, Britain's public-option defined contribution plan wants to let participants people access some of their retirement money for emergencies more easily.
Consumer debt undermines personal retirement savings: LIMRA
LIMRA finds that six in 10 American workers with non-mortgage debt say paying down debt negatively impacts their efforts to save for retirement.
Behavior risk is rising for FIA living benefit issuers: Ruark
The amount of client assets protected by a GLIB outside the surrender charge period—a measure of the rising behavioral risk exposure for FIA issuers—increased 82% from 2017 to 2018,...
