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IRI: Annuity Features Appeal to Middle-Income Boomers

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Middle-income baby boomers may have less to spend on annuities than higher-income boomers, but they are more interested in guarantees and much less interested in rate of return.

The Insured Retirement Institute (IRI), Washington, has published those findings in a summary of results from a recent telephone interview of 801 U.S. adults ages 50 to 65 who are approaching retirement or have recently retired.

Only 14% of the survey participants with annual household income between $30,000 and $75,000 said they felt extremely or very knowledgeable about investing, compared with 22% of the participants with annual household income over $75,000.

For high-income participants, a high rate of return is critical: 25% of them said a high rate of return is the most important trait in a retirement investment; just 16% of the middle-income participants said rate of return is the most important trait.

For 19% of the participants, “Investment will not lose principal” is the most important trait, and for 17%, “Guaranteed income each month” is essential.

When high-income participants were asked about the value of guarantees, 14% cited protection against loss of principal as the most important trait; 13% named guaranteed monthly income.

- Allison Bell

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