Annuities: A Game-Changer for Client Risk Management
In today’s financial landscape, annuities are making a comeback - and for good reason. As market volatility grows and clients become increasingly concerned about long-term financial security, annuities are stepping up to provide solutions that truly deliver peace of mind. If you’ve been wondering how to keep your clients secure and satisfied, it’s time to take a closer look at how annuities can transform your practice.
The Growing Importance of Annuities
Why are annuities becoming such a hot topic? It’s simple: they meet one of your clients’ biggest concerns - running out of money.
Annuities aren’t one-size-fits-all, and that’s where their strength lies. Here’s a quick breakdown of the types you can work with:
- Life Annuity: Perfect for clients who want guaranteed income for life. It’s the ultimate safety net against outliving their savings.
- Joint and Survivor Annuity: A great choice for couples, ensuring income continues for a spouse or partner after one person passes away.
- Term Certain Annuity: Ideal for clients looking for income during a specific phase of their retirement, such as in the years before a pension kicks in.
When you match the right annuity to your client’s needs, you’re not just offering a product - you’re offering security.
Why Annuities Belong in Your Clients’ Portfolios
Let’s face it: today’s retirees are navigating uncharted waters. Markets are unpredictable, lifespans are increasing, and traditional retirement strategies may not always provide enough assurance. That’s where annuities come in.
Guaranteed Income for Life
This is the big one. Annuities provide a dependable income stream, no matter what happens in the markets. When your clients know they’ll always have money coming in, they can enjoy retirement with less worry.
Protection from Market Volatility
Unlike other investments, annuities don’t rise and fall with the market. This makes them a fantastic option for clients who need added stability, whether it’s due to their financial capacity or their risk tolerance.
Tax Efficiency
Annuities can also play a key role in tax planning. With options for tax-deferred growth, they’re a smart way to help clients minimize taxes while maximizing income.
Annuities are not for everyone, but clients who place a high value on risk management may be attracted to these benefits.
Tailoring Annuities to Your Clients’ Needs
One of the great things about annuities is their flexibility. Whether you’re working with a conservative saver or a high-net-worth investor, there’s an annuity that fits.
Here are a few examples to guide your conversations:
- Risk-Averse Clients: For clients who want certainty above all else, life annuities or term certain annuities can be a great fit.
- Clients Nearing Retirement: Deferred annuities can provide a bridge, allowing them to grow their savings and lock in future income.
- Couples: A joint and survivor annuity ensures both partners feel secure, no matter what happens.
- High-Net-Worth Individuals: Use annuities to cover essential expenses and free up other assets for luxury spending, growth or legacy planning.
The key is personalization. When you tailor your annuity recommendations for each client, you can build trust and make wise choices together.
What’s New in Annuities?
If you think annuities are outdated, think again. The industry has been evolving to meet the needs of today’s retirees. Here’s what’s new:
Customizable Features
Modern annuities offer inflation protection, income adjustment options, and even early withdrawal features. These enhancements make annuities more adaptable to your clients’ lives.
Technology Tools
Managing annuities has never been easier. Digital platforms let clients and advisors track, manage, and adjust annuity plans seamlessly.
Transparency
Today’s annuities are simpler and easier to understand, making them more appealing to clients who value clarity.
Talk to your Beneva support team to make sure you have the tools you need to offer cutting-edge solutions to your clients.
Making Annuities Work for Your Clients
Integrating annuities into your practice doesn’t have to be complicated. Here are some tips to get started:
Ask the Right Questions
Start by understanding your client’s fears, goals, and financial situation. Questions like, “How would guaranteed income change your mindset?” can open the door to meaningful conversations about annuities.
Educate Your Clients
Many clients are unfamiliar with how annuities work. A clear, jargon-free explanation can go a long way in helping them see the value.
Avoid Common Mistakes
Don’t forget about liquidity - make sure your clients have access to funds for unexpected expenses. Annuities should be part of a broader financial strategy, and plans should be revisited regularly to make sure they’re working.
When you take the time to understand your client’s situation and guide them through their options, you reinforce your role as a trusted advisor.
Ready to Change The Game?
In an unpredictable world, annuities empower you to provide your clients with resilience, stability, and peace of mind. By incorporating annuities into your practice, you’re not just selling a product - you’re building financial security for the people who trust you with their future.
Annuities could be the risk management game-changer your clients have been looking for, and the differentiator that sets you apart as their advisor. When you’re ready, Beneva will be here to train and support you with the high-quality annuity solutions you need.