According to research by BlackRock, 77% of retirees would have chosen a steady income stream over a lump sum, while 15% said they would prefer a partial lump sum and partial income stream. Given the choice between having control of their money or giving up that control for a steady, guaranteed income, 70% opted to stay in control of their assets. “If you frame annuities as income for life, Americans love annuities,” said David Laibson, an economics professor at Harvard. “If you frame it with the necessary loss of control, people head for the hills.” The Treasury rolled out a proposal to buy longevity annuities with retirement savings. Under the proposal, an annuity that costs no more than 25% of the account balance up to $100.000, and that begins by age 85, would be exempt when calculating required withdrawals.
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