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  • Matthew Woodard

An Unknown Desire for Annuities?

Updated: Sep 20, 2018

As advisors face a more generally educated consumer, hesitancy still exists in the purchasing decision of annuity products.


Clients are inundated when accessing information about these instruments; What to look for, how to buy them, and the list of considerations goes on. The historical reputation isn’t exactly great either. What was formerly a lack of knowledge about the products however, has given way to not knowing who or what to believe. It can absolutely kill an advisor’s suggestion to use an annuity in a client’s financial planning process. If you take a moment, type into any search engine the term, “Annuity,” and look at what comes up. Words like, “Myth,” or phrases such as, “8 Facts about Annuities..,” and myriad other expressions display immediately. Everyone has an opinion but more importantly, how does your client develop hers or his?


As an advisor, the education provided to each client is generally the crux of that client’s decision making. More importantly, HOW that advice is positioned to a client, has a huge effect in the purchase decision. Have you ever thought about how you position these types of instruments if asked about it?

A thought to consider; It’s a common notion that many consumers feel that the purchase of an annuity is an investment decision rather than an insurance decision. Compare the phrases, “Earnings” vs. “Payment” and ask yourself, “have I ever positioned an annuity with a client as a purchase of insurance, rather than as an investment?”

With the loose outlier of Variable Annuities, most annuities perform as insurance products. Why would you want your client walking away from your meeting with a focus on the evaluation of an investment rather than a consumption of insurance perspective? You’re doing your advising business a disservice if you are.


Clients have shown a great interest in what annuities can accomplish yet they don’t know that these are the instruments that can help get them there. With approximately 10,000 Baby Boomers turning 65 everyday, this isn’t a surprise. I think it’s safe to assume that a lot of consumers do consider lifetime income or guaranteed principal protection, valuable. The peace of mind that accompanies these products are important factors of what advisors provide to their clients. Yet while advisors explain guaranteed options/strategies, a focus on HOW these benefits are positioned, is as nearly important as what they provide.