This white paper explores the relationship between interest rates and annuities for a household approaching retirement. The analysis makes clear that the potential role of deferred fixed annuities may be underappreciated when interest rates are low, even assuming interest rates do rise in the future.
If you are looking for a well-researched approach to help your retirement clients, download Why Purchase a Deferred Fixed Annuity in a Rising Interest-Rate Environment?, written by Wade D. Pfau.
Wade D. Pfau, Ph.D., CFA®
Professor of Retirement Income, The American College of Financial Services
Wade D. Pfau, Ph.D., CFA, is a professor of retirement income in the Ph.D. program for Financial and Retirement Planning at The American College in Bryn Mawr, Pennsylvania. He also serves as a principal and director for McLean Asset Management and chief planning strategist of software provider inStream Solutions. He holds a doctorate in economics from Princeton University and publishes frequently in a wide variety of academic and practitioner research journals on topics related to retirement income. He hosts the Retirement Researcher website, and is a contributor to Forbes, Advisor Perspectives, Journal of Financial Planning, and an expert panelist for the Wall Street Journal. His research has been discussed in outlets including the print editions of The Economist, New York Times, Wall Street Journal, Time, Kiplinger’s, and Money Magazine. He is the author of the books, How Much Can I Spend in Retirement? A Guide to Investment-Based Retirement Income Strategies, and Reverse Mortgages: How to Use Reverse Mortgages to Secure Your Retirement.
The author of this article is not an employee or affiliated with Pacific Life Insurance Company.
Pacific Life, its distributors, and respective representatives do not provide tax, accounting, or legal advice. Any taxpayer should seek advice based on the taxpayer's particular circumstances from an independent tax advisor or attorney.
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Pacific Life refers to Pacific Life Insurance Company and its affiliates, including Pacific Life & Annuity Company. Insurance products are issued by Pacific Life Insurance Company in all states except New York and in New York by Pacific Life & Annuity Company. Product availability and features may vary by state. Each insurance company is solely responsible for the financial obligations accruing under the products it issues.
Variable insurance products are distributed by Pacific Select Distributors, LLC (member FINRA & SIPC), a subsidiary of Pacific Life Insurance Company (Newport Beach, CA) and an affiliate of Pacific Life & Annuity Company. Variable and fixed annuity products are available through licensed third parties.
No bank guarantee • Not a deposit • Not FDIC/NCUA insured • May lose value • Not insured by any federal government agency