Page 10 - Investment Advisor November 2022

RETIREMENT/ANNUITIES PLANNING

By John Manganaro

What the Future of Annuities Means for Advisors

The shift from accumulation to decumulation is a tough one that advisors
must help clients navigate, says Kelli Hueler.

hile many in the financial As advisors work with their clients
planning world are still on income planning, they need to keep
Wstudying up on the best in mind that there is a lot of emotion
ways to communicate about and deliver involved in these decisions. Ultimately,
annuities to retirement planning cli- building an income plan is all about going
ents, Kelli Hueler, CEO and founder of from an accumulation-based lifestyle to
Hueler Cos., has been working on the one based on decumulation, and that is a
challenge for many years and her firm difficult psychological transition to make.
offers resources for the analysis, selec- What is one common misconcep-
tion and implementation of stable value tion or issue you see when it comes
and lifetime income annuity products. to discussions about annuities? Every
Is ‘income’ finally getting the atten- day, people ask us the question: How
tion it deserves? The answer is yes, What should wealth advisors much should I annuitize? Well, it is
finally. There were a lot of days in the past know about the annuity landscape? impossible to say without a detailed anal-
when we felt like we were painfully ahead [There’s] the need to have some com- ysis of your situation. Answering that
of our time, given our focus on annuity petition and pricing transparency at the question is what a great advisor can help
distribution. For many years, it was really point of purchase. In our conversations you do. The determination of how much
hard to get people to sit down with us and with plan advisors and wealth manag- to annuitize is a critical decision and one
have discussions about lifetime income. ers, they emphasize this point, because that must be carefully considered for
Today, things are a lot different, and they are either working in a fiduciary each client. There is no simple answer to
you can see that in Fidelity’s announce- capacity for their clients or their clients the question of how much to annuitize.
ment. In the past few years, the financial are in the position of being retirement Are you optimistic about the prog-
advisor community has really helped plan fiduciaries themselves. No matter ress in this field? Yes, we are so opti-
to inform some of the retirement plan how good an annuity product manufac- mistic about what comes next and the
providers and annuity product manufac- turer is, no single provider can offer the opportunity to collaborate with advi-
turers about what their clients want and best solution in every situation, and so sors and product providers across the
need as it pertains to income solutions. choice and competition are such impor- board. The greatest part for us, now, is
Our point of view at Hueler Cos. is that tant elements to consider. to see how the marketplace has become
we need to all work together to create What do you do for advisors who so much more open minded relative
meaningful competition at the point of don’t work in the retirement plan con- to collaboration.
annuity purchase, whether we are talking text? The client needs do look different There are still a few firms that are
about annuities being purchased inside for wealth advisors. Anecdotally, I can still insular. Their point of view is that
or outside of retirement plans. We are tell you that many clients with substan- they aren’t interested in anything they
gratified to see the fact that providers like tial assets still fear their longevity risk, haven’t built themselves. They still
Fidelity are embracing the notion that pro- and so they may view annuities as that believe everything needs to be an in-
prietary, closed-architecture solutions are backstop, in case they live even lon- house, proprietary solution. Today, we
not going to solve the income challenge. ger than anticipated. This is especially have moved beyond this point of view.
In Fidelity’s case, the annuities prevalent among women who are work- The industry sees the importance of giv-
come with institutional pricing and are ing with wealth advisors. Other clients ing people standardized, clear and easily
offered by a significant variety of insur- might have market volatility as a prima- comparable annuity choices.
ers. The open architecture style is the ry concern, and so they seek to protect
future of income, and it’s very exciting portions of their assets from potential Reach Senior Retirement Reporter John Adobe Stock
from where we sit. market losses via annuitization. Manganaro at [email protected].

8 INVESTMENT ADVISOR NOVEMBER 2022 | ThinkAdvisor.com