Women in Their Early 60s Want Annuities More Than Men Do: Study

Fifty-three percent of American women ages 61 to 65 do not think their retirement savings and sources of income will last their lifetime, compared with 36% of men of similar age, the Alliance for Lifetime Income reported this week.

This finding appeared in the third chapter of ALI's ongoing 2023 Protected Retirement Income and Planning study, which examines the rapidly changing retirement planning landscape.

Sixty-one percent of Peak 65 women (the term ALI applies to women between 61 and 65) report that they are extremely interested in a financial product that guarantees lifetime income, compared to 53% of Peak 65 men. At the same time, these women are much less familiar with annuities than their male counterparts.

"Today, women control a third of total household assets, estimated at more than $10 trillion," Jean Statler, ALI chief executive, said in a statement.

Statler said financial professionals had better find ways to protect female clients' income in retirement. "Speaking from personal experience, if they don't, those women will most likely go to another advisor who does."

The PRIP study was conducted online by Artemis Strategy Group in February and March among 2,507 American consumers, of whom 507 were an oversample of Peak 65 consumers for a total of 845 Peak 65 consumers. The study also included 519 financial professionals who conduct retirement planning for individual clients.

Advisors, Take Note

Forty-eight percent of Peak 65 women in the survey expressed great interest in owning an annuity that guarantees steady lifetime income, compared with 37% of Peak 65 men.

Fifty-nine percent of Peak 65 women who work with financial professionals reported that their advisors do not discuss annuities with them, or if they do, they are unaware, versus 44% of Peak 65 men.

Among Peak 65 women with a financial professional, 43% said that when their advisor recommended an annuity, they bought one, whereas only 20% of Peak 65 men who received a recommendation did so.

Among Peak 65 people who are married or living with a partner, nearly half of women but only a third of men said they were extremely interested in owning an annuity. For those who are not partnered, Peak 65 women and men expressed similar interest in owning an annuity.

"It's no surprise that women are more interested in annuities than men, and yet, many advisors often overlook them during retirement planning conversations," Suzanne Norman, an education fellow at the Retirement Income Institute, said in the statement. "Advisors have a responsibility to present financial strategies that can best meet female clients' unique needs and goals."

The ALI report, citing a recent Pew Charitable Trusts study, noted that Americans' insufficient retirement savings could create a combined $1.3 trillion burden for state and federal governments over 20 years because of increased public assistance costs and decreased tax revenue and household spending.

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