‘Peak 65’ Women Show Interest in Annuities, Despite Unfamiliarity

Author: Amanda Umpierrez

Date: 8/1/2023

View article on 401k Specialist

Over 12,000 Americans will turn 65-years-old every day in 2024, as the nation reaches its Peak 65, a historic demographic milestone that will see millions of Baby Boomers retire within the year.

A new study by Alliance for Lifetime Income and CANNEX explores how future retirees, and particularly women, are using protected income to afford their retirement in the coming years. The third chapter from the multi-part 2023 Protected Retirement Income and Planning (PRIP) study, Retirement Outlooks Among Peak 65 Women, examines the challenges women ages 61 to 65 will need to navigate in retirement.

Currently, 53% of women do not think their retirement savings and sources of income will last throughout their lifetime compared to 36% of Peak 65 men, Alliance for Lifetime Income and CANNEX found.

According to the study, Peak 65 women believe adding protected income to their retirement strategy can help maintain the lifestyle they want throughout retirement. Sixty-one percent of women expressed interest in owning a financial product that provides a regular amount of lifetime income, and 48% say they are extremely interested in owning an annuity that guarantees steady lifetime income, compared to 37% of Peak 65 men.

Still, Peak 65 women are likelier to remain unfamiliar with annuities. Peak 65 men are twice as likely (20%) to be extremely familiar with the product compared to women (10%).

Furthermore, 59% of Peak 65 women who work with a financial professional say their advisor does not discuss annuities with them, or if they do, they’re unaware compared to 44% of Peak 65 men. This is despite the fact that 43% of women who work with an advisor who recommend an annuity are likelier to buy one, compared to 20% of Peak 65 men.

“Despite deep-seated obstacles and hurdles women face in saving for retirement, women recognize annuities can give them the must-have retirement income they can count on for the peace of mind and freedom to live the retirement they want,” said Jean Statler, CEO of the Alliance for Lifetime Income, in a statement.

“It’s no surprise that women are more interested in annuities than men, and yet, many advisors often overlook them during retirement planning conversations,” added Suzanne Norman, education fellow at the Retirement Income Institute, in the statement. “Advisors have a responsibility to present financial strategies that can best meet female clients’ unique needs and goals. For both women and men alike, it is always important to consider how protected income, like annuities, can help clients live out the retirement they want, especially in today’s economic climate.”

Additional insights explored how married or partnered respondents plan to access their retirement, finding that:

• Among partnered Peak 65 people (married or living with a partner), 47% of women are extremely interested in owning an annuity compared to 33% of men.
• For those who are not partnered (never married, separated, divorced or widowed) Peak 65 women and men have similar interest in owning an annuity (50% of non-partnered women and 48% of non-partnered Peak 65 men).