According to InvestmentNews, last year, annuity sales reached the highest level since the 2008 financial crisis, due in part because of a type of variable annuity tied to stock market indexes. To learn more about the sector’s upward trajectory, InvestmentNews turned to Sawchuk Wealth Founder and Chairman Terry Sawchuk.
Sawchuk explains that annuities are offering more consumer-friendly contracts today than they were five or more years ago, contributing to their popularity among investors looking for stable returns.
In the past, the contracts featured a variety of expensive riders, Sawchuk explained. Now new products, such as RILAs, include buffer and floor features that are sought after in volatile markets.
“The value proposition has completely reversed,” Sawchuk said. “These contracts give clients the prospect of better potential risk-adjusted returns. In this world where volatility and risk are increasing every day, that kind of value proposition is attractive to a client.”
Mitigating market volatility becomes more important as clients reach retirement age. “Where it’s appropriate, we try to use annuities contracts in lieu of bonds,” Sawchuk said.
Any information discussed in this article is for educational purposes only. It is not meant to be any kind of recommendation or financial advice. The information contained in this video is intended for informational purposes only. Any opinions are those of Terry Sawchuk and not necessarily those of JW Cole Financial, Inc. or JW Cole Advisors, Inc.
Securities offered through J.W. Cole Financial, Inc. (JWC) Member FINRA/SIPC. Advisory services offered through J.W. Cole Advisors, Inc. (JWCA). Sawchuk Wealth and JWC/JWCA are unaffiliated entities.