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Gallup
Poll: Annuities Provide Greater Retirement
Security for Middle-Class
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Copyright: |
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PR Newswire US |
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download the 2009 Gallup Survey, go
to:
http://annuity-insurers.org/annuities.aspx
WASHINGTON,
Sept. 17 /PRNewswire-USNewswire/ -- Results from
a Gallup survey released today demonstrate that
non-qualified annuities contribute significantly
to the retirement security of middle-class
Americans, and that those who own annuities have
great confidence in their financial future even
amidst the recent recession and market
downturns.
The survey of 1003
annuity owners nationwide, conducted by The
Gallup Organization (Gallup) and Mathew
Greenwald & Associates (Greenwald) in
conjunction with the Committee of Annuity
Insurers (CAI), paints an interesting picture of
who purchases non-qualified annuities and
why:
-- Purchased by Middle-Class
Americans. Eight out of 10 non-qualified annuity
owners (80%) have annual household incomes below
$100,000. Only 4% have annual incomes greater
than $200,000. Almost half (42%) have annual
household incomes below $50,000. -- Improve
Retirement Security. Over 90% of non-qualified
annuity owners agree that the statement "you
have done a very good job of saving for
retirement" describes them well. Further, they
view their annuities as contributing greatly to
this preparedness - -- Almost 8 in 10 (79%)
think that annuities are an important source of
retirement security and make them feel more
comfortable in times of financial uncertainty.
-- More than 8 in 10 (83%) intend to use their
annuities to provide a financial cushion in case
they or their spouses live well beyond their
life expectancy. -- More than 8 in 10 (81%) also
intend to use their annuities to avoid being a
financial burden on their children in their
later years. -- Owners are most likely to be
older, retired, women. The survey also shows
that most non-qualified annuity owners are
female (58%) and that the average owner is a
retired 70-year-old woman with a moderate
income. Most owners (69%) also are retired,
which is up from 58% in 2005. Owners' average
age also increased from 66 to 70 between 2005
and 2009. -- Happy with annuity purchase. Owners
demonstrate a unique loyalty and commitment to
their annuity purchases, with almost all (93%)
reporting that they still own their first
annuity. -- The survey also reflects a striking
dichotomy between the American population at
large and those who invest in an annuity as part
of their retirement planning. While most
national polls show a decline in consumer
confidence about retirement, more than half of
annuity owners (55%) believe that they have
enough or more than enough money to cover their
financial needs in retirement. This is the tenth
survey conducted by Gallup and Greenwald for the
CAI since 1992, and the first since 2005.
"This survey demonstrates
that these Americans consider their annuities
the answer to both sides of the fundamental
retirement challenge, a method to accumulate
retirement savings and a vehicle to turn their
savings into a steady retirement income stream
that cannot be outlived," said Deborah Winston
of the CAI.
The Gallup survey
reinforces what many policymakers already know -
that annuities play a critical role in
addressing America's retirement security
problems. In fact, legislation currently being
considered in Congress would create tax
advantages for the conversion of a portion of an
individual's savings into a lifetime retirement
income stream provided through an
annuity.
The Retirement Security
Needs Lifetime Pay Act, H.R. 2748, in the U.S.
House of Representatives, and the Retirement
Security for Life Act, S. 1297, in the U.S.
Senate, would increase accessibility to lifetime
annuities by creating a federal income tax
exclusion for a portion of annual annuity
income, creating significant tax savings for
middle-income Americans.
"These
legislative proposals are specific solutions to
help middle-income Americans obtain the
financial security in retirement that they
deserve. The time for Congress to act is now.
All Americans should enjoy the same confidence
in their retirement future that current annuity
owners enjoy," said Bill Waldie, Chairman of the
retirement issues advocacy coalition, Americans
for Secure Retirement.
About
the Committee of Annuity
Insurers
The Committee of
Annuity Insurers is a coalition of life
insurance companies that was formed in 1982 to
address federal legislative and regulatory
issues relevant to the annuity industry and to
participate in the development of federal tax
and securities policies related to annuities.
The Committee's current 30 members include the
nation's largest and most prominent issuers of
annuities, representing over two-thirds of the
annuity business in the United
States.
2009 Gallup Survey of
Owners of Non-Qualified
Annuities
The Committee of
Annuity Insurers has partnered with The Gallup
Organization and Mathew Greenwald &
Associates to conduct 10 comprehensive surveys
of non-qualified annuity owners between 1992 and
2009. The surveys create a unique profile of
non-qualified annuity owners and their attitudes
toward saving for retirement. The 2009 survey,
conducted among 1003 annuity owners across the
country, found that non-qualified annuities
contribute greatly to the retirement security of
middle-class
Americans.
Annuity Owners Are
Overwhelmingly Middle-Class
-- Eight
out of 10 non-qualified annuity owners (80%)
have annual household incomes below $100,000,
and only 4% have annual incomes greater than
$200,000. -- In fact, almost half (42%) have
annual household incomes below $50,000.
Majority of Annuity Owners Are
Women
-- Non-qualified annuity
owners are more likely to be female (58%) than
male (42%). With the exception of the 2001
survey, females have outnumbered males in every
survey since 1997. -- The average owner is
retired, 70 years old, a woman, and has a
moderate income.
Annuity
Owners Are an Older and Loyal Group
-- Almost all non-qualified annuity
owners (93%) report that they still own their
first annuity. -- Seven in 10 (69%) are retired,
which is up from 58% in 2005. -- The average age
of annuity owners increased in 2009 to 70,
compared to 66 in 2005.
Annuity Owners View
Themselves as Financially Prepared for
Retirement
-- While many Americans believe that
they are not financially prepared for
retirement, 91% of non-qualified annuity owners
say that the statement "you have done a very
good job of saving for retirement" describes
them well. -- In that regard, almost 3 in 4
(73%) say that they have set aside more money
for retirement than they would have if the tax
advantages of annuities were not available.
Almost 9 in 10 (88%) say that keeping those
advantages is a good way of encouraging
long-term savings, and more than 9 in 10 (91%)
say that the prospect of paying tax on money
withdrawn from their annuities makes them try
not to do so before they retire. The latter
suggests that the current tax rules successfully
encourage them to retain their savings until
needed in retirement.
A Safe
and Secure Way to Save for Retirement
-- Despite the recent market
turmoil, which led to a decline in consumer
confidence about preparedness for retirement,
almost 8 in 10 annuity owners (79%) say that
annuities are secure and safe, an important
source of retirement security, and make them
feel more secure in times of financial
uncertainty. -- The vast majority of annuity
owners say that annuities are an effective way
to save for retirement (86%) and that their
annuity was a safe purchase (89%). -- More than
3 in 4 (76%) say that they intend to use their
annuities for retirement income. Other intended
uses include a financial cushion in case they or
their spouses live well beyond their life
expectancy (83%) or to avoid being a financial
burden on their children (81%). -- Almost 9 in
10 (85%) agree that investment and insurance
guarantees available in annuities are a very
important benefit of the product.
Gallup and Greenwald indicated
that they are confident that the survey results
represent the characteristics of non-qualified
annuity owners with a sampling error of plus or
minus three percentage points at the 95%
confidence
level.
SOURCE
Committee of Annuity
Insurers
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