Putnam Investments is Positioning Itself at the Forefront of the Retirement Income Industry
Both the Obama Administration and Congress are considering ways in which Americans can become more aware of the need for guaranteed lifetime income .
Annuity News
Demand for Talent is Strong in the Retirement Income Market
A recent study by IbisWorld estimates that the cumulative revenue growth in the retirement planning industry over the next decade will be 134%. Demand for skills in and around retirement income products and distribution is very high at the moment, and this will likely continue to be the case.
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Federal Government Requests Advice on Use of Annuities in Retirement Plans
A handfull of federal agencies have posted a request in the Federal Register. The agencies are requesting information and advice on the use of annuities and other lifetime income products in employer sponsored retirement plans such as 401ks. Comments are due May 3. The interest stems from the prevalence of defined contribution retirement plans such as 401ks and the fact that most participants in these retirement plans distribute their savings in the form of a lump sum rather than a stream of...
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Longevity Market Leaps Ahead with Launch of Life and Longevity Markets Association
A group of banks and insurance companies recently formed a London-based trade group called the Life and Longevity Markets Association (LLMA). The LLMA aims to develop a liquid market for longevity risk that taps into broader capital markets rather than just the balance sheets of certain insurers and reinsurers. A core focus will be on longevity swaps and making the longevity swap transaction process more efficient. Longevity swaps serve as a risk transfer alternative to pension buyouts. The...
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Variable Annuity Related FINRA Arbitration Cases Triple in 2009
The Financial Industry Regulatory Authority (" FINRA ") has reported that the number of arbitration cases related to the sale of variable annuity products increased from 47 cases in 2008 to 123 cases in 2009. Overall, the number of arbitration cases surged 43% to 7,137. This increase in investor grievances is not surprising given what a difficult year 2009 was for many. Investment News reports that many of the variable annuity cases involve "products with risky subaccounts and clients over age...
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Senate Bill 2832 Could Transform Retirement Income Market
While an initial step, Senate bill 2832 could set the course for significant changes in the retirement income industry. The bill would amend the Employee Retirement Income Security Act (ERISA) which governs defined contribution plans such as the 401k . Plan sponsors would be required to provide plan participants with an annual statement that shows what the value of their retirement account would be in terms of guaranteed monthly payments--in other words, annuity payments . The bill is intended...
Majority of Wealthy Americans Concerned about Longevity Risk
A recent survey conducted by Bank of America indicates that the majority of wealthy Americans are concerned about outliving their savings in retirement. The BofA survey results reveal that 53 percent of respondents are concerned about making their savings last through retirement, and 59 percent cite healthcare costs as a major concern. A surprising 67 percent of BofA survey respondents said that they did not work with a financial advisor for retirement planning . The survey focuses on...
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Annuitization Continues to be a Focus of Obama Administration
The Obama Administration continues to make annuities and other potential sources a guaranteed income a policy priority. As described in a recent Bloomberg article, much of the concern seems to be related to the retirement plan damage caused by the financial crisis. While recently recovered, average 401k balances took a major hit in 2008 and early 2009. Bloomberg reports that the U.S. Treasury and Labor Departments will ask for public comment as soon as next week on ways to promote the...
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BofA Merrill Seeking More Retirement Plan Business
BofA Merrill is focused on recruiting more of its existing corporate customers to its retirement planning business. Reuters reports that the brokerage firm has recently formed three new teams of advisors what will focus on serving the retirement plans of Bank of America's current corporate and investment banking clients. The cross-referrals from the brokerage division to Bank of America have been strong thus far within the newly merged company, with the wealth management division referring 3,...
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AXA Equitable Releases Innovative Variable Annuity
AXA Equitable Life Insurance Company has been an innovator in the variable annuity industry. The company was a pioneer in the area of guaranteed living benefits with the launch of the first guaranteed minimum income benefit . AXA has recently launched a new variable annuity product named "Retirement Cornerstone." Retirement Cornerstone features a "dual account platform" that provides the potential for long-term asset accumulation and growth as well as downside protection through a guaranteed...
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