Why your high-net-worth client wants annuities

As the number of years Canadians spend in retirement continues to rise, the way that retirement funds are invested is increasingly important. Developing strategies that mitigate against the financial risks associated with retirement and provide clients with financial security into their 80s and 90s is a necessity for any diligent advisor.

“There are three main financial risks that retirees can control by purchasing the appropriate products through an advisor,” explains Lowell Aronoff, CEO of CANNEX Financial Exchanges Ltd, which provides annuity and retirement income educational tools designed to enhance advisors’ financial planning processes. “These risks are longevity (outliving your savings), inflation and sequence of return risk (poor returns in the early retirement years).”

Annuities play a crucial role in helping Canadian advisors steer their clients away from these common retirement pitfalls. “Annuities mitigate against longevity risk by providing clients with guaranteed lifetime income. If purchased with an optional annual income index, which means that their payments increase every year, they can help reduce inflation risk,” Aronoff says. “The sequence of return risk is mitigated with annuities because annuity payments are predictable and known in advance.”

Designed to provide stable, long-term income, annuities allow advisors to guarantee financial security to their aging clients. Canadians can buy an annuity by depositing a lump sum from a RRSP, a RRIF or a non-registered account and then choosing an appropriate guarantee period, how long to wait before payments begin and whether they want a single life or joint life (with a spouse) policy.

Research shows that having a significant portion of assets in products that guarantee income for life, like pensions or annuities, is a good option for most retired clients with significant savings.The carbon dioxide is known low priced viagra as a natural vasodilating compound in blood. After a detailed study about the issue generico viagra on line and the approaches to manage it. Smoking and drinking are just cialis generika deeprootsmag.org bad for your sex life. With increase in blood flow to the penis, corpora cavernosa will expand further, thus http://deeprootsmag.org/2016/02/13/neon-deon/ order cialis pills creating larger and stronger erection.

An advisor who encourages their high-net-worth clients to buy annuities is also more likely to build longer, mutually beneficial relationships. “An advisor who has clients of a certain age should be focusing on retirement income planning,” Aronoff says. “Wealthy clients often work with a number of advisors by the time they’re in their 60s and at that age it’s generally a good idea to consolidate assets with one advisor. If you address retirement income planning holistically, you will have a better story for your clients when they consolidate their assets.”

As the baby boomer generation reaches retirement age, the annuities market represents a fantastic opportunity for advisors looking to expand their business in providing advice on retirement income.