“Verb sales” in retirement income, or in liability minimization, needs regulatory support immediately. By “verbs,” I mean selling services – such as financial planning – rather than “nouns” – such as investment products like annuities.
I examine the benefits of the contingent deferred annuity (CDA), and whether it’s poised to become the next big thing in retirement.
With the growth in 401(k) plans and the contraction of private pensions over the last 30 years, risks in retirement have slowly and almost imperceptibly transferred from institutions to individuals. Institutions staffed with actuaries and analysts are well suited to manage those risks. Individual investors may need some help.
This session introduces a relatively new kind of portfolio income insurance: a Contingent Deferred Annuity. It unbundles the insurance from underlying investments so that advisors may “wrap” the risk in client portfolios by covering investments in retail ETFs and mutual funds with lifetime income protections.
In the current unstable economic environment, producing safe, reliable income over the course of an unknown retirement is a daunting goal for any financial professional. As a result, many Americans sub-optimize their retirement experience.
FINRA interprets “financial advisor” as being usable (on business cards and elsewhere) by any financial professional who holds an RIA affiliation, whether or not the relationship with the client is in fact an advisory one.
Holistic tools are sorely needed to give fiduciary advisors a bridge between investment-oriented income generation and annuity-oriented approaches to retirement income.