In the U.S. individual annuity market, purchasers of variable annuity contracts with no guaranteed living benefits are the youngsters.
The average age of a consumer who bought a bare variable annuity in 2016 was just 57, according to analysts at LIMRA, a nonprofit life insurance research consortium.
Single-premium immediate annuities, or contracts designed to convert one big payment into a stream of income right away, attracted the oldest consumers. The average age of a 2016 SPIA purchaser was 71, according to the LIMRA analysts.
The average purchase age was 59 for deferred income annuities, 61 for indexed annuities without guaranteed withdrawal benefits, 62 for indexed annuities or variable annuities with benefits guarantees, and 65 for fixed-rate annuities.
Typical 2016 buyers of all types of annuities were in their early 60s.
The LIMRA analysts included the annuity purchaser age data in a summary of results from a survey of 50 annuity issuers conducted in 2016. The participating issuers accounted for about 80% of 2016 retail annuity sales.
In addition to looking at buyer ages, the analysts who managed the survey addressed topics such as annuity purchasers’ financial objectives and the average cost of the annuities purchased.
The analysts found, for example, that the average initial investment for all types of annuities was about $116,000.
The average initial investment for SPIAs was about $150,000.
— Read Michael Doughty to Lead LIMRA’s Parent on ThinkAdvisor.