Insight: ANNUITY DEMAND AT RETIREMENT: RATIONAL AND BEHAVIORAL PERSPECTIVES AND PROCRASTINATION FACTORS
By Derrick Bonyuet
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The goal of this Insight is for retirees and their financial advisors to understand what drives the demand for annuities at retirement, under what conditions annuities can serve to enhance consumers’ welfare, and what rational and behavioral factors come into play when purchasing annuities. An annuity is an insurance contract where the purchaser (the annuitant), can receive from the insurer a stream of payments in exchange for an upfront premium. The three articles covered in this Insight connect existing research on annuities and extend the findings to help understand why some people do not follow this approach. This is also known as the “annuity puzzle.”
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About the Author
Derrick Bonyuet is a Clinical Assistant Professor in the Department of Accounting in the McCombs School of Business at the University of Texas in Austin, Texas. He received his PhD in Business Administration from Oklahoma State University and holds three master’s degrees: a Master’s degree in Accountancy from Auburn University, a Master’s degree in International Management from the Thunderbird School of Global Management, and an MBA in Finance from the University of Houston. He earned his Bachelor of Science in Accounting from Universidad Católica Andrés Bello (Venezuela). He has worked for Dell Technologies since 1998 in a variety of finance roles. Earlier in his career, he spent four years in public accounting with PricewaterhouseCoopers. He holds a CPA license and the CFA and CFP designations.