5 Reasons ‘Non-Buyers’ May Still Be Good Annuity Prospects
April 25, 2018 by Allison Bell
Todd Giesing has come up with data suggesting that people who have actively decided against buying annuities could be pretty good annuity prospects.
Giesing, director of annuity research at the Secure Retirement Institute, talked about the data earlier this month in Chicago, at the 2018 Retirement Industry Conference.
The institute — an arm of LIMRA-LOMA — conducted an online survey, in 2017, of about 2,400 people who had at least considered buying annuities.
Click HERE to read the original story via ThinkAdvisor.
Only 18% of the non-buyers said they “hate annuities,” according to Giesing’s slidedeck for the presentation.
About 42% said their decision not to buy was a matter of being in the right place at the wrong time. In other words: Those “non-buyers” are already open to the idea of eventually buying annuities.
More than two-thirds of the non-buyers ended up using mutual funds or stocks to meet their financial needs, but 24% bought nothing. Some of those non-buyers might still have cash in search of a good home, parked in a checking account, or under a mattress.
Giesing also presented comparisons of survey answers given by annuity buyers and non-buyers. (See snippets of the data in the idea gallery above.)
Here are some highlights from the slidedeck:
Age
Giesing found that the non-buyers were more than six years younger, on average, than the survey participants who had recently bought annuities for the first time.
That implies one simple marketing strategy might to wait for the non-buyers to get older.
Finances
The non-buyers had lower levels of investable assets than the buyers, but they also had lower levels of debt.
Documents
The non-buyers were somewhat less likely to have a formal written retirement plan.
It could be that simply helping the non-buyers put their retirement plans in writing could turn some into buyers.
Advisor relationships
The non-buyers tended to be less happy than the buyers with their financial advisors, but the typical non-buyers were still happy with their advisors.
Only 2% of the annuity buyers said they were dissatisfied with their advisors.
About 10% of the non-buyers said they were dissatisfied, but far more — 66% — said they were satisfied.
