More than 85 percent of investors age 55 to 70 who work with independent RIAs want guaranteed monthly income for life while still allowing for stock market gains, according to Fidelity Investments. Well who wouldn't?
But when asked to define annuity -- a product that has potential to provide such benefits -- only one in five could do so accurately. There were certain points about annuities most investors could not explain.
Only an average of 30 percent of investors knew what the costs and fees are and how annuity guarantees can protect against stock market losses. Less than 20 percent knew about the ability to exchange one annuity for another. Forty-one percent said they aren't interested in annuities because they simply don't know enough about them and 35 percent said it's because their advisor never recommended it.
