CANNEX: Immediate Annuity Shoppers Look Younger

By Allison Bell

News May 11, 2023 at 12:08 PM

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U.S. residents who were shopping for immediate annuities in the first quarter were almost a year younger than the shoppers who were looking for immediate annuities in the first quarter of 2022

The average age of the shopper described in an immediate annuity search fell to 67.4 years in the latest quarter, from 68.5 years in the year-earlier quarter, according to Cannex Financial Exchanges, a Toronto-based company financial services data firm.

What It Means

The cooling of the labor market might be casting a harsh light on clients' hopes of staying in the workforce past age 70.

Immediate Annuities

Clients use deferred annuities to set money aside for retirement or other long-range planning purposes.

Clients typically use immediate annuities to convert a nest egg into a stream of retirement income right away, or less than 12 months in the future.

The Data

The average Cannex shopper who sought quotes in the latest quarter hoped to produce $36,891 in annual income and proposed paying an average of $346,147 in premiums for annuity income, according to Cannex.

The annual income average dropped 7.3% from the average recorded a year earlier, and the average premium entered fell 5.1%.

The average income starting date increased to 2.3 months in the future, from 1.9 months in the future.

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