By Leora Friedberg and Anthony Webb

Paper Overview

Both academic economists and financial professionals emphasize the value of annuities for households that need to manage risks during retirement. Yet, the types of annuity products that they consider, and the risks that those products help manage, are vastly different. We demonstrate how to incorporate features of real-world annuity products into economic models, with the goal of stimulating academic research, and we elucidate the economic consequences of real-world annuity products for financial professionals, with the goal of facilitating an appropriate match of product features to household needs.