The number of financial planners recommending annuities to their clients increased by six per cent in 2014, up from 32 per cent in the previous year, new research has found.
In a report entitled December 2014 Retirement Planner Report – compiled off a survey of 617 planners – Investment Trends found 38 per cent of planners recommended annuities to their clients in 2014, up six per cent from 32 per cent in 2013.
This also compared with 27 per cent of planners who recommended annuities to their clients in 2012.
Commenting on the research results, Investment Trends senior analyst Recep Peker said planners are continuing to see a “greater role” for annuities as part of their retirement advice.
“In addition to already increasing usage, the intention to use annuities has also increased, with 59 per cent of planners intending to recommend annuity products in the coming year, up from 45 per cent saying so in the previous study,” Mr Peker said.
“In recommending annuities, planners are responding to client concerns such as longevity risk.
“Healthy client interest will continue to buoy planner appetite for annuities in the current low-interest environment,” he said.
The research house also found an upward trend in the use of life time annuities.
“They are the guaranteed income product of choice, according to the survey, with 39 per cent of planners saying they intend to use them in 2015, compared with 31 per cent for long-term annuities (five years or more) and 21 per cent for short-term annuities (less than five years),” a statement from Investment Trends said.
“In 2014, 19 per cent of planners used lifetime annuities, compared with 20 per cent for long-term annuities and 17 per cent for short-term annuities.”
“Among planners who recommended income guaranteed products in the last 12 months the vast majority, 86 per cent, used a Challenger product,” the statement said.
It was poised to be one of the biggest public offerings of the year, but for a second time Latitude Financial failed to list on the ASX this...
Bank of Queensland posted a 14 per cent fall in profits for the 2019 financial year as the fallout from the Hayne royal commission burdens s...
AMP’s recent changes to its wealth management business is around getting to a simpler business “led by client needs” and “not by sel...