Wealth management clients increasingly express interest in downside protection features and guaranteed retirement income, and they are seeking out advisors with deeper expertise in these areas.
This is according to the latest research brief published by the Insured Retirement Institute, based on a survey of nearly 200 financial advisors who are active in the business development process and who have utilized annuities on behalf of clients in the past year.
As the survey shows, financial advisors who leverage annuities feel they are well-poised to align their services effectively with their clients' evolving needs. These advisors report that clients more commonly view annuities as one of the few products available in the marketplace that are capable of providing protection against market losses and ensuring long-term income security.
"The implications of these findings are far-reaching," argues Frank O'Connor, vice president of research at IRI.
"As the market landscape evolves, advisors equipped with these insights are better positioned to navigate market disruptions and deliver tailored solutions that resonate with clients," O'Connor says. "These findings reinforce the value annuities can provide to investors and the importance of annuities to financial advisors as a tool that can uniquely address the goals and concerns clients express most frequently."
Key Findings
In response to the IRI's questions, advisors reported that clients' top concerns revolve around inflation, market volatility and the possibility of a recession.
As noted, the survey results suggest that clients express heightened interest in downside protection features and guaranteed income, and the priority placed on these aspects suggests that clients are not solely focused on maximizing growth. Instead, they are equally concerned about safeguarding their investments and securing a reliable income stream, according to the IRI data.
Specifically, some 82% of advisors say their clients see "secure income" as a top goal, whereas only 53% of advisors say the same for "asset growth."
