Longevity has emerged as the new retirement goal for baby boomers and senior generations who are hoping to outlive their savings and pass wealth onto their heirs. This is in stark contrast with the pre-recession years when wealth building and asset appreciation were the primary motivations of most retirement planners. However, many boomers lost a great deal of wealth when the market collapsed, and others faced medical issues, job losses and housing problems that may have also depleted their hard-earned savings. In response, most turned to conservative retirement products that provided reasonable interest rates and guaranteed income.

A recent seminar sponsored by LifeHealthPro and Bankers Annuity Brokerage, entitled “Selling Annuities in a Volatile Market,” found that annuities are expected to take on a larger market share and emerge as a stronger source of finance lead generation for advisory services and insurance companies. Moderator Daniel Williams, who serves as editor of Senior Market Advisor, noted that while senior generations were inherently more conservative and maintained a low tolerance for risky investments, baby boomers are now taking their cue from older demographics and also shunning more volatile products, ProducersWeb.com reports. Williams also pointed out this shift in the boomer generation is important because this group historically gravitated toward riskier investments with greater potential for high returns prior to the Great Recession.

Protection against money loss is main concern of today’s retirees

Most retirees cite their fear of seeing their nest eggs dry up as their primary concern when they enter their golden years. Given the state of the economy and job market, many people are being forced to delay retirement and work longer. For those who are already retired, however, finding a job when their finances are stretched thin may no longer be a viable option.

Faced with these realities, annuities have emerged as the safest and most reliable product because it provides a guaranteed income stream.

In addition, most annuities offer higher rates than other safe investments, such as certificates of deposit, and also keep up with inflation. Therefore, it’s not difficult to understand why these products may become a more attractive resource for retirees than investments that fluctuate with the volatile market.

Although annuities serve an important purpose during retirement, many professionals would discourage retirees from focusing solely on this product during their golden years. Maintaining a greater level of diversification is still the least risky and most popular strategy for continuing to build wealth and protect assets during retirement.

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