Seeking downside protection for investors at or near retirement age

Avoiding the “downside” in general is a major part of everyday living, but especially when it comes to financial investments — and particularly as investors advance in age and need a fluffier financial cushion.

One group that’s currently seeking to ensure stability in retirement and avoid impacts of financial downturns is the Baby Boomer generation. As Baby Boomers continue to age into their retirement, the need for financial security grows, and many find themselves looking for ways to protect against possible losses.

How can you help your Baby Boomer clients fulfill their goal of establishing downside protection?

Current financial trends & concerns

AARP conducted a survey of Americans 50 years and older and found that 39% of women ages 50 to 64 say the economy is not working well for them personally, while 67% of total respondents claimed to be very or somewhat worried that prices are rising faster than income.1 Furthermore, the survey found that an unexpected expense of $1,000 would be a major setback for 42% of women ages 50 to 64 and 32% of men in the same age group.1

Another AARP survey, this time given to adults ages 30 and up, showed that 33% of adults age 30 and over indicated their financial situation was worse in July 2022 than it was 12 months earlier.2

What this means for Baby Boomers at or approaching retirement

These surveys demonstrate significant concern over financial affairs in a large swath of age groups. What could that mean for your Baby Boomer clients nearing the door to retirement?

Baby Boomers are fast approaching the reality of retirement, and must take a good look at every aspect of their finances to ensure they’ll be set for life after work. Even the most risk-tolerant Baby Boomers may need to concede that it might be time to shoot for more moderate or lower risks and growth, and settle in for something more stable — or they may risk facing a downer of a retirement.

The unpredictability of the last few years and the doubts expressed in the AARP surveys speak to a larger uncertainty those in this generation may have to take steps to avoid — especially given all the hard work they’ve put in for a rewarding and comfortable retirement. Plus, when you factor in economic anxieties like inflation, the lingering effects of the pandemic, and a generous helping of volatility and doubt, you’ll want to help your clients do everything they can to set themselves up to help protect against big losses.

To instill greater confidence in their golden years as retirement creeps closer, Baby Boomers may choose to aim for something steadier and more reliable, rather than high-risk, high-reward investment options. They’ll need to seriously consider the moves to make to allow them to spend comfortably on everyday living as well as the lifestyle endeavors they’ve been dreaming of throughout their careers.

So, what can help secure such comfortable post-work living?

Lowering risk with annuities

An annuity can help ensure reliable income for life while catering to an individual’s risk tolerances and lifestyle. Among choices that range from registered index-linked annuities (RILAs) and variable index-linked annuities to fixed annuities and income annuities, there’s likely an annuity product available that suits the needs of nearly every one of your clients from this generation.

RILAs in particular offer solutions for varying needs across different phases of life, including retirement. RILAs can offer clients downside protection, allowing them to decide how much they’re willing to risk while ensuring they won’t lose more than that.

Let’s put the spotlight on one special type of registered index-linked annuity: The CUNA Mutual Group Zone Income™ Annuity.

Learn more about the Zone Income Annuity

If ever there was a happy medium between seeking growth while limiting risk and still ensuring lifetime income, Zone Income Annuity is the place to find it. Clients can choose their guaranteed floor and even adjust their risk “comfort zone” on an annual basis. On top of that, clients receive interest linked to the performance of one or more market indexes or a declared rate amount. That adds up to personalization and flexibility fit for someone who wants to set their own limits while still achieving some growth and maintaining a steady income in retirement.

We invite you to visit our informative page and learn more about the Zone Income Annuity, which may be the answer to your Boomer clients and their desire to protect themselves from potential market downturns. Simply click the link below to learn more.



Blog Sub Logo

Get updates & insights

Enter your email below to subscribe!