Jun 20, 2024
Corporate
Annuity Myths and Truths
By Dale Uthoff, Chief Product Officer, Group 1001 Life and Annuity
June is National Annuity Awareness Month. Annuities can offer flexibility both in how you save for and receive money in retirement. It comes down to knowing that there are different types of annuities, each designed to address a specific need or life stage.
According to LIMRA, U.S. annuity sales were $113.5 billion during the first quarter of 2024, 21% higher than the first quarter of 2023. Yet I often hear from people who are confused by annuities or overwhelmed by the many product offerings. As Chief Product Officer at Group 1001 Life and Annuity, here are some of the most common misconceptions I hear and the reality.
Myth: Annuities are expensive with high fees.
Reality: Many annuities have no fees whatsoever. Products like multi-year guaranteed annuities and many fixed indexed annuities do not charge fees to the policyholder. There are annuities with fees, and those fees are generally used to cover additional benefits such as lifetime income offerings. The fee is used by the insurer to help cover the cost of insuring the lifetime income benefit.
Myth: Annuities are complicated.
Reality: Some annuities are complicated, but many are relatively straightforward. Annuities such as multi-year guaranteed annuities are quite simple. These products offer a guaranteed interest for the term of the annuity. These offer similar benefits and use cases to certificates of deposits but offer the additional advantage of tax deferral. In other words, the interest isn’t taxable until withdrawn from the contract.
Myth: Annuities are only for retirees.
Reality: Annuities can help savers, too. Annuities can be an extremely useful part of building a retirement portfolio. Whether you are accumulating savings or trying to establish a stream of guaranteed lifetime income, annuities can be helpful. Additionally, the tax-deferred growth accumulation of annuities can provide a faster accumulation of retirement savings and defer taxes until retirement.
Myth: I can easily create lifetime income from my retirement accounts.
Reality: We don’t know how long we are going to live or how well retirement account assets are going to perform in the future. Therefore, it’s very difficult to predict how much you can safely withdraw from your retirement accounts on an annual basis. Some historical rules of thumb like 4% per year are designed to cover most scenarios including those that combine poor market performance and a lengthy retirement. Annuities can often deliver a higher level of retirement income than these rules of thumb because the insurance company is taking the risk and pooling large numbers of policyholders.
Myth: The insurance company keeps my remaining money when I die.
Reality: With most types of annuities, there are specific death benefits. Some of these annuities even provide options for beneficiaries to select a lump sum or ongoing payments. When planning estates, people most often think about life insurance, but annuities can have features useful for this as well. There are, however, specific types of annuities (life contingent single premium immediate annuities) that can be structured to make payments only as long as you live. The benefit of this is to achieve the highest possible income payment while you are alive, but the tradeoff can be reduced or non-existent death benefits. As with anything, there are tradeoffs with different options.
Myth: Once I invest in an annuity, my money is locked up and can’t be touched.
Reality: Nearly all annuities allow you to withdraw some of the money – usually up to 10% of the amount or the earnings on the contract (whichever is greater) without any penalty. You also generally can withdraw amounts in excess of that amount but will incur surrender or early withdrawal penalties. An annuity is a longer term commitment than some other savings vehicles which allows the insurance company to provide attractive rates of return compared to other options. While you have some ability to get your money back early from an annuity, it is best to be confident that you can invest for the full term of the contract.
As you can see, there are many myths and realities around annuities. Annuities have evolved and continue to evolve. Today’s annuity marketplace is more diverse than ever before. Today’s products include many combinations of benefits, elements of flexibility, and ways for policyholders to save money, invest for retirement, and convert retirement savings into a guaranteed lifetime income stream. Because of all the benefits and uses, it’s important to do your research and speak with a financial professional you trust to determine whether a specific financial product is right for you.
Dale Uthoff is the Chief Product Officer for Group 1001 Life and Annuity. Dale oversees all product efforts for the Group 1001 Life and Annuity Business Unit. This includes product development and product management for fixed, indexed, and variable annuity products sold by Group 1001 companies. The opinions expressed herein are his own and not necessarily those of my employer.
Nov 15, 2024
Corporate
Employees Participate in Nasdaq Closing Bell
This week, employees attended the Nasdaq Closing Bell to celebrate the recent launch of Delaware Life's select Fixed Indexed Annuity products featuring the innovative Nasdaq-100 Volatility Control 12%™ Index. We are proud to be a Nasdaq partner. Learn more about how our annuities can help you power your retirement...
Nov 7, 2024
Corporate
Group 1001 Welcomes Tony Marichal as Vice President of Annuity Operations
Group 1001, a leading financial services company, announces Tony Marichal as Vice President of Annuity Operations of Group 1001 Life & Annuity.
Reporting to Chief Operating Officer Martin Woll, Marichal oversees the annuity operations for two Group 1001 companies, Delaware Life Insurance Company and Clear Spring Lif...
Oct 31, 2024
Corporate
Group 1001 Leverages Apprenticeships to Attract Tech Talent
Group 1001 and Franklin Skills Partnership
One year ago, Group 1001 and Franklin Skills (formerly Franklin Apprenticeship) partnered to launch Group 1001’s first apprenticeship program. This program provides employees with on-the-job tech training under the supervision of skilled IT managers and mentors and customized i...
Oct 21, 2024
Corporate
Gainbridge® and RetireOne® Partner to Offer Innovative Annuity Products to Registered Investment Advisors
Gainbridge®, through its Group 1001 affiliate, announced today a partnership with RetireOne, the leading independent platform in the annuity marketplace for registered investment advisors (RIAs). RetireOne, an outsourced insurance desk, provides RIAs and their customers valuable solutions that are simple to use, easy t...
Oct 7, 2024
Corporate
Group 1001 Announces Chief Risk Officer and Chief Internal Audit Officer Appointments
Group 1001 announces that Dan Healy has been appointed the Chief Risk Officer, Group 1001, and Mark McCallister has been promoted and will succeed Dan as Chief Internal Audit Officer.
Healy has been with Group 1001 for more than nine years and has been acting as the interim Chief Risk Officer for the Life & Annuity...
Aug 16, 2024
Corporate
Delaware Life Accelerator Prime® Variable Annuity Named to Barron’s 2024 List of Top 100 Annuities for Fifth Consecutive Year
Delaware Life Insurance Company, a Group 1001 company, announces its inclusion in the annual Barron’s list of “Top 100 Best Annuities.” This is the fifth consecutive year that Barron's has ranked Delaware Life Insurance Company annuities in the top 100.
Delaware Life Accelerator Prime® Variable Annuity was recogni...
Jul 24, 2024
Corporate
Group 1001 Wins Business Insurance Community Outreach Project of the Year
Group 1001 has won the 2024 U.S. Insurance Award for Community Outreach Project of the Year – Pro Bono and Volunteer for 1001 Hours of Impact.
This award from Business Insurance recognizes a community outreach project in 2023 by an organization operating in the commercial insurance and risk management sector that invol...
Jul 11, 2024
Corporate
Delaware Life Insurance Company Recognized as a 2024 Ward’s Top 50® Life-Health Company
Delaware Life Insurance Company, a Group 1001 company, has been named a Ward’s 50® top-performing life-health company for 2024. This placement positions Delaware Life Insurance Company in the top 50 of more than 700 life-health insurance companies for outstanding financial results in the areas of safety, consistency, a...
Jun 25, 2024
Corporate
Group 1001 Names Martin Woll as Chief Operating Officer
Group 1001, a leading financial services company, announces Martin Woll as Chief Operating Officer of Group 1001 Life & Annuity. A member of the executive leadership team and reporting to Group 1001’s President and CEO, Woll will lead the operations team, including the client experience, facilities, and corporate r...
May 21, 2024
Corporate
Delaware Life Announces Enhancements to Fixed Index Annuities, Bringing Innovation and Diversification Including the Invesco QQQ ETF
To give consumers a simple, tailored way to diversify returns and guarantee higher minimum growth, Delaware Life Insurance Company (Delaware Life), a Group 1001 company, announces the addition of two diversified, multi-strategy Precision Portfolios as part of the Growth Pathway fixed index annuity (FIA). As an addition...
Apr 15, 2024
Corporate
New Savings Program Offers Higher APY by Combining Market Returns with a Guaranteed Yield
Gainbridge®, a Group 1001 company, and Save®Advisers, LLC, a technology and wealth management company, announced the launch of Market+ to address the needs of savers who want market participation with a minimum guaranteed return.
Market+ offers a hybrid yield structure, featuring a 3% guaranteed annual yield (returned i...
Apr 11, 2024
Sponsorship
Corporate
DUPR and Delaware Life Team Up to Fuel Growth of Pickleball
Delaware Life Insurance Company (“Delaware Life”), a Group 1001 company and a leader in annuity and life insurance products, and DUPR (Dynamic Universal Pickleball Rating), today announced a long-term partnership dedicated to driving growth and innovation in pickleball.
Under the agreement, Delaware Life is the exclusi...
Mar 25, 2024
Corporate
Delaware Life Insurance Company Launches Innovative Fixed Index Annuity with Premium Bonus: PrimeStart Bonus 10SM
WALTHAM, Mass., March 25, 2024 - Delaware Life Insurance Company ("Delaware Life") has launched an innovative, flexible-premium fixed index annuity featuring a premium bonus. PrimeStart Bonus 10SM offers an exclusive trifecta of features combining the power of a 10% premium bonus, interest crediting that’s ba...
Mar 11, 2024
Corporate
Group 1001 Names Boaknin as Chief Information Officer
Zionsville, Ind. (March 11, 2024) – Group 1001, a leading financial services company, announces Nick Boaknin as Chief Information Officer. Boaknin previously held the role of Technology Transformation Leader.
As Chief Information Officer, Boaknin will assist Group 1001’s Technology team in building and delivering high-...
Mar 7, 2024
Corporate
Sponsorship
Group 1001 Includes Women Employees’ Names on Race Cars in Honor of Women’s History Month
Group 1001, a leading financial services company, is off to the races to recognize and honor women employees and financial advisors during Women’s History Month in March.
To celebrate women working for Group 1001, more than 450 woman employees’ names will be included Sunday, March 10 on two Group 1001 company race cars...
Mar 5, 2024
Corporate
Sponsorship
Gainbridge® Signs College Basketball Star Caitlin Clark as Brand Ambassador
Gainbridge®, a Group 1001 company, announced today a multi-year partnership with Iowa women’s basketball star Caitlin Clark to serve as brand ambassador for the company. The company also announced a new product now available on the Gainbridge® platform, ParityFlex™, a multi-year guaranteed annuity product created for w...
Feb 27, 2024
Corporate
Group 1001 Announces Two Vice President Technology Hires
Zionsville, IN (February 27, 2024) - Group 1001, a leading financial services company, announced the addition of Tricia Borcherding as Vice President, Technology Governance and Walter Hjelmar as Vice President, Platforms and Cloud.
In the role of Vice President, Technology Governance, Borcherding will shape and oversee...
Feb 8, 2024
Work Life
Corporate
Celebrating Black History Month
Every February, the United States honors the contributions, sacrifices, and achievements of Black Americans who have helped shape the nation. We’ve asked several Group 1001 employees how they celebrate Black History Month and what it means to them.
Black History Month originally started as National Negro History Week in...
