“We’re at a pivotal time with the economy,” said Mike Reidy, National Sales Manager, RIA Channel at Security Benefit. “With the 2024 U.S. presidential election ahead, many RIAs are not concerned about a major equity market downturn over the next 12 months. However, they do anticipate that the market will experience a higher level of volatility than experienced in 2023.” With volatility comes uncertainty. “We will likely see rates remain the same over the next few months, with a potential decrease late in the year, though conditions like geopolitical developments and other political uncertainty are worrying advisors and their clients.”

Inflation woes remain

With the Personal Consumption Expenditures (PCE) inflation standing at 2.6%, four in ten advisors noted being extremely or very concerned about inflation and international conflicts negatively impacting the equity markets. RIAs have a much higher level of concern about inflation and international conflicts affecting investments in comparison to their clients. In fact, only 47% of RIAs surveyed believe inflation will be in the 2-2.9% range in the second half of the year, compared to 57% last quarter.

RIAs fear the effect that the political climate will have on the investment climate

Eighty percent of RIAs reported that their clients are concerned that the political environment over the next 12 months will impact their investments. Additionally, 32% of advisors expect the political climate to have a negative impact on the investment climate, though, in contrast, one in six (15%) expect it to have a positive impact.

Advisors agree that downside protection is important to clients

With concern growing over volatility for the second half of the year, it’s no surprise that RIAs believe their clients are very concerned about investment loss and value protection—in fact, 80% of RIAs agree that protection against loss is “highly” valued by clients. However, only 50% of RIAs state that downside protection products can play a valuable role in many clients’ portfolios. “This is where annuity products can fill the gap for financial professionals,” noted Reidy. “The more risk-sensitive the client, the more guaranteed principal products make sense as part of their portfolio mix.”

Nearly half (49%) of RIAs agree that a client’s age is important to determine the necessary level of downside protection. A similar amount, (46%) believe investment allocation is an important factor in determining the necessary level.

Methodology

In May 2024, Greenwald Research surveyed 100 registered investment advisors from across the United States, each managing significant assets and directly interacting with clients. The online questionnaire collected crucial data on RIAs’ business practices, economic outlook, financial product usage, and client demographics. This method blended quantitative and qualitative insights, capturing key trends within the financial advisory industry.

About Security Benefit

Security Benefit Life Holdings (“Security Benefit”), through its subsidiary Security Benefit Life Insurance Company (SBLIC), a Kansas-domiciled insurance company that has been in business for more than 132 years, is a leader in the U.S. retirement market. Security Benefit together with its affiliates offers products in a full range of retirement markets and wealth segments for employers and individuals and held $51.6 billion in assets under management as of December 31, 2023. Security Benefit, an Eldridge business, continues its mission of helping Americans To and Through Retirement^®. Learn more at www.securitybenefit.com and follow us on LinkedIn, Facebook, or X (formerly Twitter).

About Greenwald Research

Greenwald Research is a leading independent research and consulting partner to the health and wealth industries that applies quantitative and qualitative research methods to produce insights that help companies stay competitive and navigate industry change. Leveraging deep subject matter expertise and a trusted consultative approach since 1985, Greenwald offers comprehensive services to answer strategic business questions.

SB-10052-55

FINANCIAL PROFESSIONAL USE ONLY – NOT FOR USE WITH CONSUMERS
Annuities are issued by SBLIC in all states except New York.