In partnership with CANNEX, North America’s leading provider of pricing, data,
and annuities product research, the Alliance released the second installment of the Protected Retirement Income and Planning Study (PRIP 2.0), a joint research effort focused on both investors and financial professionals, designed to better understand and forecast retirement income trends.

Investors Choose annuities and protection over the traditional 60/40 allocation

With Peak 65 in sight, many investors are interested in annuities as a reliable source of protected lifetime income. With increasing volatility and uncertainty in the markets, it’s not surprising that Americans are increasingly looking for ways to protect their retirement portfolios.

According to the newly released PRIP 2.0, investors who were asked to build their own hypothetical $1 million retirement portfolio, said annuities and other income-producing assets were the most favored.

Some of the study’s key takeaways include:

  • The findings run counter to the long standing 60/40 strategy in which 60% of a retirement portfolio’s assets are invested in stocks, while the remaining 40% are invested in bonds—an approach originally designed to simultaneously grow assets and provide income.
  • An overwhelming majority of investors (85%) are interested in owning an annuity that guarantees lifetime income, or already own one.
  • However, the corollary study of financial professionals found just 18% believe their clients are extremely interested in annuities with lifetime income, indicating that there is a huge gap in what investors want and what advisors think they want.
  • The study also found that, when presented with an investment opportunity, many investors fall victim to behavioral biases such as familiarity bias (81%), emotional gap (81%) and herd mentality (66%).
  • In investor’s hypothetical portfolios, “trending” investment opportunities such as SPACs and cryptocurrency fell to the bottom of their list, with only 3-4% of assets allocated to each.

“Our research continues to show growing interest and significant demand from consumers for protected income, as more Americans become educated about the lifetime income, asset protection and other benefits of annuities.”

Jean Statler, CEO of the Alliance for Lifetime Income

This second installment comes after the inaugural study published in June 2021, which found investors eager for financial protection amid a challenging fixed-income environment and the declining prevalence of private sector pensions. The PRIP studies are an outgrowth of the Protected Lifetime Income Study, an annual, Census-balanced survey of U.S. adults the Alliance sponsored in 2018 and 2020 to gauge consumers’ attitudes and behaviors around retirement-income planning.

To view the full findings, visit the links below:

To learn more about the findings from the first Protected Retirement and Income Planning study, visit the links below:

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