An easy income recipe from Financial Engines: Put 15% of your savings in a triple- leveraged stock ETF and the rest in something safe, like a TIPS ladder.
Many factors are driving the increase in indexed annuity sales: More manufacturers, better products, more distributors, competitive commissions, aging boomers, and relaxed regulation. But does the bubble contain the seeds of its own deflation?
Israel has found that even a mandatory defined contribution system can’t resolve all of the behavioral, economic, or administrative issues that prevent low-income and minority workers from saving for retirement. (Photo: Mahane Yehuda market in Jerusalem.)
This week, RIJ received a press copy of “What Advisors Want from Annuity and Insurer Providers-2019,” a study by Practical Perspectives, a Boxford, MA-based financial services market research firm.
Today, insurers are invoking fiduciary duty to justify the offering of lifetime income products in 401(k) plans. If the fiduciary standard were applied to the management of money in rollover IRAs, they might use it to persuade advisers to put part of their clients’ savings in annuities.
Forbes reporter Ted Siedle alleges that asset managers are using the financial crisis to gain greater control over the billions in troubled public pensions—in this case, Rhode Island’s.
“The company is approaching the upper range for calendar year 2013 for total premium from variable annuities (VAs) that offer optional guaranteed benefits,” said a Jackson National release.
“We do not want to set down a law that says ‘there are three ways you can do pension, and here’s what they are,’” said Steve Webb, Britain's pensions minister, “but to say ‘here’s a set of models, you can choose.’”
“The story of book yields on investable assets, as with invested assets, has been one of decline. Gross book yields for the life insurance industry decreased 18 bps in 2012 to reach a low of 5.24% of average investable assets. This is not as large as the 38 bps decrease seen between 2008 and 2009, but the pull of decreasing interest rates has obviously overpowered moves that insurers made to increase yield in the post-crisis period.”-- from Conning's 'Life Insurance Investments' study, October 2013.
Brief or late-breaking items from Financial Engines, Prudential, Guardian Insurance and BNY Mellon.