The actions by Treasury and Labor amount to a "huge endorsement" of annuities and of the message that "you, as a consumer, need to protect yourself" from the risk of outliving your assets, points out Michael Pinkans, senior vice president of marketing at Zenith Marketing Group.
The initiatives have opened up another opportunity for making a sale as well as opportunities to do some planning, Pinkans
For instance, although independent advisors could always offer workers partial and full rollover IRA annuities, now they have the government's endorsement of annuities to help them, he
They will also have the government regulations to give more support to partial annuities than previously was the case, he
thinks certain workers will indeed want to obtain independent expertise.
"People don't know where to turn when they enter retirement," he
But that will take time and money-and some agents won't want to expend either-a decision that Pinkans
says could limit their options in this market.
Know the available income solutions.
Advisors who are already dual licensed can discuss a variety of income strategies and solutions with workers.
But that means the advisor needs to keep abreast of the options as they come out.
In today's market, for instance, it may look as if rolling some of the 401(k) money into a fixed indexed annuity in a rollover IRA would be the best bet for clients with a long term horizon, Pinkans
puts it, "some government body might decide to launch new efforts to regulate indexed annuities.
Or efforts could be made to put certain annuities under the Employee Retirement Income Security Act (ERISA), and say 'now you are regulated under ERISA'."
Then again, he
says, "those things might never happen, because annuities today are more heavily regulated than even two years ago, for suitability, disclosure, product training and more.