James Poer, president of NFP Advisor Services Group, remarked, "To attract and retain clients, advisors must keep up with the dynamic, ever-changing investment environment. This study clearly indicates that the appeal and practicality of guaranteed income investments is rising, and we are pleased to be able to provide additional insight on this topic."
The study which was commissioned by NFP Advisor Services Group utilized a 360 degree approach including perspectives from investors, independent advisors and leading insurance carrier executives.
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The study, which explores the gap between consumer need and advisor utilization revealed that in 2010, 48% of all US households indicated an interest in products that provide guaranteed income for life.
It was also found that investors are willing to accept a low rate of return for such protection.
Further, the consumer survey respondents were willing to pay between 4 – 6 % of assets to guarantee they wouldn’t run out of money in retirement.
Nevertheless, the financial advisors affiliated with an independent RIA only recommend guarantees 49% of the time, while financial advisors affiliated with an independent broker/dealer only recommend them 69% of the time when clients are facing longevity risks.
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By GlobalDataAdditionally, the study stated that guaranteed income solutions represented a missed opportunity which deserves serious consideration from advisors.
