` 

May 3, 2010

The Need to Insure Retirement with

Fixed Deferred and Immediate Annuities

Fixed annuities are an important tool for retirement 

planning. The need to be exposed to and 

understand the value of fixed annuities and their 

insured guarantees is important to individuals who 

participate in employer-sponsored retirement plans, 

as well as the 78 million working Americans who lack 

access to a workplace retirement plan.

A fixed annuity is the only product that allows 

individuals to accumulate retirement savings, 

protect those savings from declining markets and 

receive guaranteed income for life.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 2 of 31 

Contents 

I. About NAFA, the National Association for Fixed Annuities

II. Factors Impacting Retirement Savings 

III. Understanding Retirement Income Needs 

IV. Advantages of Fixed Annuities in Retirement Planning

A. About Fixed Annuities

B. Income Provided by Fixed Annuities 

C. Tradeoffs of Income Choices

V. Consumer Education & Disclosure 

A. The Historical Media and Framing as Investment versus Insurance Guarantees 

B. The Need for Insured, Guaranteed Retirement Choices 

C. What Consumers Need to Make Decisions

VI. Product Neutrality and Accessibility 

A. IRAs and Consumer Choice

B. Fixed Annuities Decrease the Chance of Retirees Running Out of Money
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 3 of 31 

I. About NAFA

NAFA, the National Association for Fixed Annuities, is a national trade association exclusively 

dedicated to promoting the awareness and understanding of fixed annuities – including income, declared 

rate, market value adjusted and indexed. NAFA is the only association whose sole purpose is advocating 

for the fixed annuity product and educating regulators, legislators, consumers, members of the media, 

industry personnel, and distributors about fixed annuities and their benefits to retirees and those planning 

retirement. NAFA’s membership of fixed annuity carriers and independent marketing organizations (or 

field organizations) represents over 200,000 agents and registered representatives selling fixed annuities. 

NAFA is grateful to its membership for their efforts and contributions to these comments. NAFA was 

founded in 1998 and is located in Milwaukee, Wisconsin.

A fixed annuity is the only product that allows individuals to accumulate retirement savings, 

protect those savings from market losses and guarantee income for life. Other financial products 

and financial strategies don't offer such guarantees and in fact, consumers who rely on those strategies 

are subject to market risk that may seriously erode their ability to have sufficient retirement income. 

Unfortunately, outside of the fixed insurance marketplace, there is little understanding of or exposure to 

the variety of income planning choices available utilizing both immediate and deferred fixed annuities. 

NAFA commends the Employee Benefits Security Administration, Department of Labor, and the 

Internal Revenue Service, Department of the Treasury (Agencies), for their interest in securing the 

retirement interests of American citizens. In the wake of the worst economic crisis since the Great 

Depression, at a time when the largest population is beginning retirement or about to retire, now more 

than ever, consumers must be encouraged to plan for retirement. As the Agencies note, unlike previous 

generations who enjoyed access to defined benefit pension plans, most members of the baby boom 

generation—and those younger—are unable to rely on an employer-provided DB pension as a means to 

secure retirement income. This means that individuals must be prepared to manage their savings to last 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 4 of 31 

throughout retirement. Consequently, Americans are being faced with the difficult task of managing 

market, inflation and longevity risks. 

Unfortunately, there has been a lack of understanding and knowledge about the variety of 

guaranteed income insurance solutions offered by fixed annuities and frankly, consumers nearing 

retirement or in retirement have not been given the information or tools to consider fixed annuities in 

making retirement planning decisions. 

The need to be exposed to and understand the value of fixed annuities and their insured 

guarantees is important to individuals who participate in employer-sponsored retirement plans, as well as 

the 78 million working Americans who lack access to a workplace retirement plan. Accordingly, NAFA 

hopes that any action taken by the Agencies will not only encourage the use of fixed annuities in 401(k) 

and other defined contribution plans, but they will also encourage their use generally for retirement 

planning.

NAFA’s submission will address the importance of enhancing retirement security for consumers 

and discuss existing consumer trends and rationale. We discuss the need to change the retirement 

discussion from one of asset allocation and wealth accumulation to one of protecting savings and the 

managed distribution of income. Past psychological tendencies for investment professionals and 

consumers to frame the retirement planning discussion in purely investment (asset growth and returns) 

strategies will no longer suffice to meet the challenges of retirement shortfalls and longevity that face 

today’s and tomorrow’s retirees. Recent studies demonstrating that a discussion framed around 

consumption and income to ensure funds will be available throughout retirement and insure retirement 

security strongly suggest that will lead consumers to more diversified product and retirement strategies. 

With that end in mind, NAFA’s comments will expose the variety of income options with fixed annuities, 

the advantages and tradeoffs to those choices, and how to better educate and expose the consumer so 

that they may consider them. 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 5 of 31 

II. Factors Impacting Retirement Savings 

From the many publications on retirement planning published in the past five years, there is little dispute 

that a variety of distinct forces are converging to create a retirement income revolution. This convergence 

has been called “A Perfect Storm” and a “Time Bomb.”1

 Some have called it a “Gray Tsunami,” 2

1. The decreasing levels of Social Security benefits 

but 

whatever the title, experts agree the following factors combined could create retirement ruin for millions of 

retirees if they are not addressed. 

2. The increase in the payroll tax and decrease in workers 

3. The death of defined benefit plans

4. The aging of baby boomers 

5. The increase in life expectancy rates. 

The decreasing levels of Social Security benefits over time can best be described as the “cliff 

effect.” According to the Social Security Administration, individuals born in 1880 might have enjoyed an 

“implicit” rate of return of nearly 25%. From there it dropped to almost 12% percent for individuals born in 

the early 1900’s, to just an inflation-adjusted rate of slightly over 1% for today’s baby boomers and their 

children. 

The increase in the payroll tax and decrease in workers contributing to Social Security has a 

negative impact on retirement savings. As the payroll tax increases to address the continued solvency 

issues of Social Security, individuals have less after-tax savings to contribute to alternative financial 

products with a likely higher return. That means today’s workers nearing retirement face significant 

retirement funding issues. 

 

1 Philip J. Scrofani, “Perfect Storms and Ticking Time Bombs.” Sage Advice, October 2005.

2 Linda M. Springer, director of the U.S. Office of Personnel Management (OPM), January 31, 2006, The Public 

Manager, Spring 2006. 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 6 of 31 

The death of defined benefit plans. The Agencies’ Request for Information did an excellent job of 

outlining the current climate of defined benefit and contribution plans in today’s workplace. Not only has 

the number of active participants in defined benefit plans fallen dramatically, but a number of other factors 

have impacted Americans.

A recent report by Babbel and Merrill3

The aging of boomers means that more and more Americans enter retirement each year. 

Beginning in 2006, the first members of the largest generation in American history turned 60 and will be 

leaving jobs and entering retirement. According to the Babbel and Merrill

states that the last fifteen years has seen only one new

pension program initiated. The number of pension plans in the U.S. peaked at 175,000 in 1983 and has 

since declined to less than 25,000. Meanwhile, 30% of the remaining programs will close within the next 

two years. At the same time, defined contribution plans (401(k), 403(b), etc.) have increased from 17,000 

to over 650,000 plans in place today. With more and more retirement savings accumulating in these 

defined contribution plans, the demand for a pre-planned, guaranteed income stream will continue to 

grow. However, as a result of the recent economic crisis, the amount of money invested in these plans 

and available for retirement has taken a significant hit. Not only did the crisis severely reduce the amount 

of money in defined contribution plans, but many employers cut off their matching programs to curtail 

company expenses and improve profit and loss forecasts. 

4

The increase in life expectancy rates is seriously contributing to Americans’ retirement 

vulnerability. The probability that an individual retiring at age 65 will reach age 80 is over 70% for females, 

and over 62% for males. Married individuals have increased probabilities, as the chance that at least one 

report, this group represents 

27% of the U.S. population and 47% of all households. 

 

3

David F. Babbel and Craig B. Merrill, Policy Brief: Personal Finance, Investing your Lump Sum at Retirement,

(Wharton Financial Institutions Center, August 14, 2007) 2. 

4 David F. Babbel and Craig B. Merrill, Page 3.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 7 of 31 

spouse will reach age 80 is nearly 90% and the chance that one spouse will live to age 85 is more than 

85%. (Ibbotson Associates, Inc., January 2003). 

Ernst & Young’s 2009 report5 produced for Americans for a Secure Retirement showed that 

the economic crisis of 2008 and 2009 significantly increased the retirement vulnerability of both near and 

recent retirees. Without making serious reductions to expenses, three-fifths of new retirees could expect 

to outlive their financial resources. A startling 95% of middle-income married couples without defined 

benefit plans would outlive their income 6

 and those without a guaranteed source of income beyond 

Social Security would have to reduce their standard of living by an average of 32 percent to avoid 

outliving their financial assets. Near retirees, those seven years out from retirement, without a guaranteed 

source of income would have to reduce their standard of living by 45 percent to minimize the likelihood of 

outliving their financial assets. 

 

5

Ernst & Young LLP, Updated Retirement Vulnerability Analysis: The Likelihood of Outliving their Financial Assets

(June 2009) 2. 

6 Ernst & Young LLP 2. 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 8 of 31 

III. Understanding Retirement Income Needs 

The Agencies requested input on how to best educate the consumer to help them understand 

retirement income options and opportunities. However, before we can address consumer education 

(which is equally essential and addressed later) we must first address the importance for professional 

retirement planners to understand retirement income needs and planning for those needs. Americans 

face three fundamental risks in planning for their retirement income: 

1. Market Risk – the risk that you will make money and lose money based on the 

performance of your portfolio and you won’t have time to recover those losses; 

2. Inflation Risk - the risk that your pre-determined retirement income will be eroded by 

inflation and you will not be able to sustain your retirement lifestyle; and, 

3. Longevity Risk – the risk that unexpected health or financial needs will deplete your 

savings or, even without those budget strains, you will simply outlive your savings. 

Unfortunately part of the primary focus of the investment community has been in managing client 

assets with the goal of maximizing wealth accumulation and asset growth NOT income sustainability. 

Most investment advisors are biased toward a standard balanced (diversified) investment portfolio with a 

systematic withdrawal of a fixed income stream during the retirement period. Individuals relying on these 

types of retirement plans are headed toward retirement ruin because of the high likelihood they will 

exhaust savings while they are still alive. 

The Retirement Income Insurance Association7 (RIIA) outlines in its “How to Benefit from the 

View Across the Silos”8

 

7 NAFA and RIIA share affiliate memberships in each association.

 the need to build a portfolio for retirement income and not simply one for asset 

accumulation. But to do so, advisor must understand the need to “build a floor” (also called in the 

8 Francois Gadenne and Michael Zwecher, How to Benefit from “The View Across the Silos”: From Investment 

Management to Retirement Income and Retirement Management, (RIIA’s Advisory Process, June 2009).
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 9 of 31 

insurance industry “the guaranteed level of income”) for the retiree that will sustain a lifecycle plan even 

though the end date is unknown. 

To build the floor and manage the growth, the paper proposes a “Hub and Spoke Model” with the 

client at the center of the planning process or hub. The Spokes consist of five analytical processes that 

are connected to and interact continuously with the client. 

Spoke 1 consists of an analysis of the household finances which starts the planning process and 

is used to analyze current income and expenses, assets versus liabilities and a snapshot of the cash 

inflows and outflows. Spoke 2 uses the cash flow analysis to match the client’s anticipated “social capital” 

(essentially Social Security and pension income), their human capital (income from any jobs held during 

retirement), and their financial capital (investments and other cash assets). This information along with 

the information from Spoke 1 is used to determine the client’s minimum income which will come from the 

social and human capital and how much will be needed from financial capital to establish their desired 

income floor. 

Spokes 3 and 4 take the results of the three sources of capital from the life cycle plan, matching it 

to the potential cost associated with retirement risks (e.g., inflation, longevity and market) and creates a 

RIIA’s Retirement Management and Retirement 

Income Advisory Process

Specific

Products

Risk 

Management

Allocations

Retirement

Risk Profile

Cash Flows

and

Life-Cycle

Profile

Balance

Sheet

Client

Relationship

Graphic: Francois Gadenne and 

Michael Zwecher, Page 19
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 10 of 31 

risk management allocation model that creates the income floor with growth potential in line with the 

client’s risk profile (modest or medium growth potential and preservation for the moderate and low risk 

tolerance and higher growth potential for the high risk individual or some combination). Spoke 5 

proceeds to identify specific products and providers to implement the plan and meet the plan’s objectives. 

This Hub and Spoke process is extremely relevant to the discussion of retirement income 

planning because to fully understand a client’s needs, advisors must have the tools to help them 

anticipate how much will be needed for a guaranteed income stream. Once that income need is solved, 

the appropriate product or products to provide for the guaranteed income can be selected. The process 

is product neutral because it does not assume the use of a particular income product or products. As a 

result of process, neutrality the planner will look into a variety of products and perhaps multiple product 

solutions that will ultimately benefit the retiree. 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 11 of 31 

VI. The Advantages of Fixed Annuities in Retirement Planning

About Fixed Annuities 

All fixed annuity insurance products provide the insurance coverage of traditional insurance 

products, including death benefits, withdrawal options, payout options and benefits triggered by disability 

or incapacitation. These insurance guarantees mean that only life insurance companies can issue fixed 

deferred insurance products. Life insurance companies are subject to strict regulation by the states. 

State regulation is designed to assure that life insurance companies will have sufficient assets to make 

good on their guarantees, even if the general economy and the business fortunes of an individual life 

insurance company fall. Moreover, only fixed insurance products are backed by their state guaranty 

fund. 

For almost 40 years, America’s life, annuity and health insurance guaranty 

associations have protected policyholders. State guaranty associations are located in

every state as well as the District of Columbia and Puerto Rico. Guaranty 

associations provide a financial safety net for consumers if their insurance company 

fails. America’s insurance safety net is time-tested, experienced—and little known, 

despite its proud history of helping millions of policyholders. Guaranty associations 

help keep the promises of the insurance industry and provide additional security to 

policyholders in troubled times. These funds provide the money to compensate 

owners if a life insurance company defaults. 

(Source: The Life and Health Guaranty Association System consumer brochure.)
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 12 of 31 

Outside this basic insurance contract, fixed annuities differ in three specific ways9

1. How many payments are made into the annuity - Single and Flexible Annuities 

; 

2. When the company makes income payments - Deferred or Immediate Annuities

3. How and when interest is credited - Declared and guaranteed for a stated period, multiple interest 

rates or indexed rate annuities

How many payments you make

When only one payment is made to fund an annuity it is called a single premium annuity. When a 

series of payments are made it is called a flexible premium annuity. How many payments you may make 

and how often you make them will be prescribed by the annuity purchased. 

When the company makes income payments 

An owner of an immediate (also called a lifetime income or payout) annuity can begin receiving 

income payments from the insurance company right after purchase or at some point during the first year. 

Generally, immediate annuities are purchased with sizeable initial or single premium payments, and 

frequently as a rollover from another source or retirement product.

An owner of a deferred annuity does not begin receiving income payments right away. Instead, 

the owner of a deferred annuity accumulates monies for a period of time and postpones or “defers” 

choosing whether to begin receiving income payments from the insurance company.

Deferred annuities offer accumulation benefits during a pay-in period and retirement income 

benefits during a pay-out period. 

 

9 The National Association of Insurance Commissioners Disclosure Working Group, The NAIC Consumer’s Buyers 

Guide to Fixed Annuities (draft March 2009).
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 13 of 31 

During the pay-in period, owners make purchase payments to an insurance company. Owners 

generally have the option of making purchase payments when and in amounts they choose. Owners 

earn a rate of interest on their purchase payments and do not pay taxes on the interests until the owner 

withdraws money. 

At retirement, the owner can take the accumulated money in either a lump-sum or a system of 

periodic payments for life or some other period of time.

During the pay-out period, the owner receives income payments from the insurance company. 

As under other fixed annuities, the dollar amount of the payments are specified and, unlike variable 

annuities, do not vary up and down in dollar amount. As under other annuities, owners have the flexibility 

of receiving these income payments for various periods, such as life, life of the owner and spouse and a 

specified number of years.

How interest is credited

You may be familiar with variable annuities, in which the owner earns a rate of return that the 

insurance company derives from the investment performance of a pool of assets invested by the 

company and managed by an investment adviser. The dollar amount of annuity payments also varies up 

and down with the performance of a pool of assets. The owner bears all of the investment risk that the 

pool will earn less than the owner could earn elsewhere and that the owner’s accumulated value or dollar 

amount of annuity payments will drop.

By contrast, under all forms of fixed annuities – income, declared rate, market value adjusted and 

indexed – the owner bears no investment risk whatsoever. This protection from investment risk is a major 

reason that fixed annuities should and do appeal to those consumers saving for retirement.

Under fixed annuities with declared rates of interest, the insurance company credits the owner 

with a rate of interest that the company declares in advance and guarantees the rate for a specified 

period. The owner bears no investment risk that the insurance company will fail to credit the declared 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 14 of 31 

interest rate. The dollar amount of annuity payments (annuitization) that may be selected in the future is 

set in advance and remains the same during the pay-out period. The owner bears no investment risk that 

the insurance company will fail to continue making annuity payments in that dollar amount. 

Rates that are guaranteed in advance and the period of time for which they are guaranteed is the 

same period as the period over which surrender charges apply (e.g., three or five years) are called MultiYear Guaranteed Annuities (MYGAs). 

Other declared rate (often referred to as “traditional” annuities) guarantee the interest for the first 

year and subsequent declared rates may be reduced or increased depending on the insurance 

company’s investment returns, but never below the minimum guaranteed rate. 

Some annuity contracts apply different interest rates to each premium you pay or to premiums 

you pay during different time periods. Other annuity contracts may have two or more accumulated values 

that fund different benefit options. These accumulated values may use different interest rates. You get 

only one of the accumulated values depending on which benefit you choose. 

Under fixed annuities with indexed rates of interest, the insurance company credits the owners a 

rate of interest that the company calculates by reference to a formula that includes a factor for changes in 

an independent index specified by the company. As under other fixed annuities, the owner bears no

investment risk that the life insurance company will fail to pay the interest rate calculated with reference to 

the index. Subsequent indexed calculation formulas may be reduced, but never below the minimum 

guaranteed formula, and the annuity owner will always be credited with the minimum guaranteed interest 

rate if that is higher than the interest rate calculated with reference to the index. Also, as under other 

fixed annuities, the dollar amount of annuity payments purchased by each dollar of contract value is set in 

advance and remains the same during the pay-out period. The owner bears no investment risk that the 

insurance company will fail to continue making annuity payments in that dollar amount.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 15 of 31 

Fixed indexed insurance products are increasingly popular with the public. As with all cash value 

insurance products, fixed indexed insurance products offer a combination of insurance and interest-rate 

features.

Fixed indexed insurance products are a natural evolution of the traditional fixed insurance product 

which offers one method of crediting interest. Fixed indexed insurance products are nothing more than a 

traditional fixed insurance product that offers owners an opportunity to receive interest based on positive 

changes in a financial markets index coupled with insurance guarantees of purchase payments and 

minimum rates of interest. All fixed indexed annuities offer multiple indices from which to choose for 

additional interest calculation during the calculation period as well as the ability to forego the indexed 

calculation and earn a declared guaranteed interest rate over the same period. Most fixed indexed 

annuities allow you to allocate your annuity value over various indices or between indices and the 

declared rate. In other words, fixed indexed insurance products offer guaranteed preservation of 

premiums coupled with guaranteed growth in value, even when indexed-based interest is small or nonexistent.

The added benefits under fixed indexed insurance products can increase in amount depending 

on the changes in financial market indexes. At the same time, benefits have guaranteed floors that 

protect against loss of principal if the performance of financial market indexes is not favorable. The 

result is that an owner has limited downside risk while potentially realizing a greater (or lesser) amount of 

credited interest than a life insurance company could declare and guarantee in advance as a fixed rate.

These insurance guarantees mean that only life insurance companies can issue fixed indexed 

insurance products. Life insurance companies are subject to strict regulation by the states. State 

regulation is designed to assure that life insurance companies will have sufficient assets to make good on 

their guarantees, even if the general economy and the business fortunes of an individual life insurance 

company fall. Moreover, fixed indexed insurance products are backed by state guaranty association 

funds. These funds provide the money to compensate owners if a life insurance company defaults.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 16 of 31 

Income Provided by Fixed Annuities 

Annuity product innovations include a wide variety of ways to provide guaranteed income through 

annuitization choices, income riders called guaranteed lifetime withdrawal benefits (GLWB) or guaranteed 

lifetime income benefits (GLIB) and withdrawal benefits. These provide retirees options as to the amount 

of guaranteed income and flexibility and control over retirement savings. 

Annuitization

Traditional income options from annuities include guaranteed income for life, for a specified 

period, or a combination of a lifetime payout with a guaranteed period. These options are typically 

referred to by the industry as “annuitization.” Annuitization is available in both immediate (also called 

payout or income annuities) and deferred annuities. The selected income stream is guaranteed. Also, 

many products offer inflation adjustment features and more innovation is currently underway that will 

provide guaranteed inflation protection using the consumer price index and other inflation measurement 

index. Here is a typical list of annuitization options available on fixed deferred and lifetime income 

(immediate) annuities:

Life Option 

The life option typically provides an income stream for life, which is an effective hedge against 

outliving retirement income. 

Joint-Life Option 

This common option allows the spouse to continue to receive payments when the annuity 

recipient dies. The monthly payment is lower than that of the life option because the calculation is 

based on the life expectancy of both the husband and wife. 

Period Certain 

With this option the value of the annuity is paid out over a defined period of time that the owner 

chooses such as 10, 15 or 20 years. If a 15-year period certain payout is selected and the 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 17 of 31 

annuitant dies within the first 10 years, the contract is guaranteed to pay your beneficiary for the 

remaining five years. 

Life with Guaranteed Term 

Many people like the idea of guaranteed income for life (which they get with the life option), but 

they are afraid to choose that option in case they die in the near future. The life-with-guaranteedterm option provides an income stream for life (like the life option), so it pays you for as long as 

you live. But this option also allows the payout recipient to select a guaranteed period, such as a 

10-year guaranteed term, for which the annuity must pay to the estate or beneficiaries even if 

death occurs before that guaranteed period is over. 

Systematic Withdrawal Schedule 

This method allows the recipient to select the amount of payment that is desired each month 

and how many payments are needed. However, the insurance company will not guarantee that 

the recipient will not outlive income payments. How much is received and how many months 

payments are received depends on the annuity cash value at payout. The risk of outliving the 

income is born by the recipient. 

Lump-Sum Payment 

Taking out all of the cash value is the least efficient payout method from a tax minimization 

perspective. Ordinary income taxes are due on the entire portion of the annuity (for IRAs and 

annuities in employer-sponsored plans) rather than spread out over time when the tax bracket 

may be lower in retirement. 

Electing Not to Take Payments 

With deferred fixed annuities you are not required to take the payments unless you choose to. 

This is beneficial in that the retiree doesn’t need to make any payout decision until and if income 

is needed. 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 18 of 31 

Income Riders

Income riders which have become one of the most popular benefits ever added to fixed deferred 

annuities. NAFA members are reporting that over 50 percent of people who purchase fixed deferred 

annuities also elect to add an income rider. These income riders are called by names such as 

guaranteed lifetime withdrawal benefits (GLWB) or guaranteed lifetime income benefits (GLIB).

The first income riders were introduced on variable annuity products in 2003, and they became 

available on fixed and fixed indexed annuity products a few years later. Income riders provide consumers 

with a guaranteed income for life (similar to what can annuitization provide), but without giving up access 

to remaining principal – a feature that caused many consumers to shy away from annuitization. By 

purchasing an income rider on a fixed rather than a variable annuity, a consumer get the benefits of the 

income rider while also being protected from investment risk.

An income rider on a fixed or fixed indexed annuity allows a retiree to build a secure retirement 

income. The payout provided by the income rider is guaranteed by the issuing insurance carrier for the 

life of the annuity owner. The issuing insurance carrier bears all of the investment and longevity risk on 

the guaranteed payout, which means that the consumer is completely protected from these risks. Some 

annuity carriers even provide for the income to substantially increase in the event that the annuity owner 

becomes confined to a nursing home, further sheltering the annuity owner from risk. In addition, the 

annuity owner retains access to the annuity’s remaining value and also continues to reap the benefits of 

interest credits to the annuity’s value.

How Income Riders Work

As previously noted, a guaranteed lifetime income or withdrawal benefit is typically optional on a 

fixed annuity, and it is added to the annuity by a rider. Whereas the annuity has an accumulation value to 

determine the death benefit or annuitization, the rider adds a second value, the income value.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 19 of 31 

The accumulation value works just as it always does on a fixed annuity. The annuity owner’s 

premium earns additional interest that is declared and guaranteed in advance or guaranteed through a 

calculation of an index (or indices) performance while at all times promising a minimum guaranteed 

interest. The unique benefit of a fixed indexed annuity (FIA) is that it has a built-in inflation hedge 

because additional interest is calculated based on a formula tied to the designated index (e.g., S&P 500). 

With income riders, the income value is completely separate from the accumulation value. It 

typically grows at a fixed rate of interest and when the retiree elects to start taking lifetime withdrawals, a 

payout factor is applied to the income value to determine the guaranteed annual withdrawal. If the 

accumulation value is higher than the income value when the income is desired, then the accumulation 

value is used in the payout calculation instead. Once the amount of guaranteed withdrawal is calculated, 

the retiree may withdraw that amount from the annuity every year for life. While taking these withdrawals, 

the retiree is provided with two very valuable guarantees. First, although the annual withdrawals are 

deducted from the accumulation value, the additional interest (declared or indexed) continues to be 

credited to the accumulation value, and the retiree retains access to the remaining accumulation value at 

all times. Second, even if the annual withdrawals ultimately deplete the accumulation value, the issuing 

carrier must continue making the annual payments as long as the retiree lives.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 20 of 31 

How Income Riders Work – At a Glance

Value Accumulation Value Income Value

How it is used It is the basis for most benefit 

calculations, including the value to be 

paid upon death, surrender, or maturity

It has one purpose – it is the value 

that is used to determine the lifetime 

payments that can be taken from the 

annuity

How it grows Interest is credited to this value using a 

choice of fixed and/or index-based 

methods

A separate fixed, guaranteed interest 

rate (usually in the 5% - 8% range) is 

credited to this value

Withdrawal Benefits

Most fixed annuities contain a provision to withdraw a portion of the annuity value without any surrender 

charge, usually after the first policy year. Many fixed annuities which are qualified contracts (IRAs) allow 

the stated withdrawal amount or the required minimum distribution (RMD), whichever is greater. 

However, this benefit is not guaranteed and if you withdraw more than the amount specified by the benefit 

you may incur a withdrawal charge. The withdrawal benefit allows access to funds in an emergency or 

planned withdrawal for income or required distribution under qualified retirement fund rules. The amount 

usually allowed is 10% of the annuity’s account once per year. Some policies let you accumulate the 

percentage allowed if you do not take a withdrawal in a given year with a maximum total accumulated 

percentage that is typically 50% of the account value. A few products limit penalty-free withdrawals to the 

interest earned during a year. 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 21 of 31 

Liquidity Available under an Annuity 

Nursing Care Rider

This feature is a special form of penalty-free withdrawal. To qualify, you usually must be admitted 

to a qualified care facility (or receive home health care) after the first policy year, for a specified period of 

time (often 90 days). When you qualify you may usually elect a penalty free withdrawal of up to 75% or 

100% of your account value.

Terminal Illness Rider

This feature is a special form of penalty-free partial withdrawal. To qualify you must be 

diagnosed by a doctor as terminally ill (death expected within one year) after the first policy year. When 

you qualify you may usually elect a penalty free withdrawal of up to 75% or 100% of your account value.

Tradeoffs of Income Choices

Annuitization or Lifetime Income Annuities

As we have discussed, the fixed immediate or lifetime annuity’s most significant (and understood) 

benefit is that the customer is guaranteed a steady stream of income for the rest of their lives, a specific 

period or a combination of lifetime and period guarantees. Economists have suggested that individuals 

can achieve substantial gains to their welfare if they eliminate the uncertainty related to their lifespan by 

purchasing annuities.10

 

10 Julie R. Agnew, Lisa R. Anderson, Jeffrey R. Gerlach, and Lisa R. Szykman, The Annuity Puzzle And Negative 

Framing, (Center for Retirement Research at Boston College, July 2008), Page 1.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 22 of 31 

The first tradeoff for the guarantee that you cannot outlive your savings is that the customer may 

not change their election. Therefore, if the customer needs more money for unexpected expenses, they 

may not access the money they have chosen to annuitize. But note: the insurance industry has 

recognized and solved for this need with GLWB income riders mentioned previously. 

In addition, many annuities do not owe the beneficiary any remaining value when the customer 

dies. Retires who would like a payout of the remaining value need only select from the products that offer 

this benefit and, in exchange for the benefit, accept a lower income stream than he or she would have 

received otherwise. 

Charges for Income Riders 

Income riders attached to a deferred annuity provide consumers with more flexibility to access their 

remaining annuity value if the consumer needs money for unexpected expenses. However, that flexibility 

comes at a cost. While the income riders guarantee lifetime income or withdrawal amounts that add a 

valuable benefit to the fixed annuity for retirees interested in a reliable retirement income, the riders are 

not free. Some carriers build the rider into the annuity product, so the cost is reflected in a lower interest 

rate on the accumulation value, the income value, or both. Other carriers charge directly by deducting a 

fee from the accumulation value of the annuity, usually based on the income benefit base. This charge 

may cause the accumulation value to fall in years in which no indexed interest is credited. Rider charges 

normally continue until the accumulation value of the annuity is depleted or the rider is removed from the 

contract.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 23 of 31 

V. Consumer Education & Disclosure 

We have discussed how the fixed annuity – deferred or lifetime payout - offers individuals 

insurance guarantees of minimum interest and the elimination of the risk of outliving income. Yet despite 

these benefits the actual size of the fixed annuity marketplace is actually quite small compared to the 

amount of money in mutual funds, stocks, bonds and other financial products (e.g., certificates of 

deposit). Over the years, there have been many studies by industry professionals, academics and 

economists to understand why the fixed lifetime annuity market is so much smaller than would be 

expected given the product’s benefits and the demographics of the last five years. The recent stream of 

new research has focused on possible psychological reasons and the Center for Retirement Research 

recently addressed how a marketing technique called negative framing11

The report not surprisingly concluded that people who are financially conservative or risk 

intolerant are more likely to choose annuities and that financial literacy affects choice. Individuals scoring 

above average on a financial literacy quiz chose the investment option more often than the annuity. 

However, a significant finding of the report was that negative framing matters. The study concluded 

that individuals were influenced by the investment-biased presentation and women were 16 percent less 

likely to choose the annuity option if they saw the presentation that negatively framed the annuity choice

while men were 14 percent less likely to choose an annuity after the investment-biased presentation. 

can influence people away from 

fixed lifetime annuities. 

The study concluded that, “the sizeable and significant influence of the biased presentations demonstrates that, even with factual statements, consumers can be swayed to purchase one financial product 

over another.”12

 

11 Julie R. Agnew, et. al., Page 2.

 Whether the presentation bias is unintentional or is intentionally used as a sales 

12 Julie R. Agnew, et. al., Page 4.
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 24 of 31 

technique to lead the customer to the product preference of the salesperson is really secondary to the 

most significant problem. The most significant problem is not matching consumers’ needs and financial 

requirements to the product or products best able to meet those needs following a complete retirement 

needs analysis. Consumers need to be made aware of and cautious about the potential influence of 

negative framing when making important financial decisions and need to be provided unbiased and 

product neutral information about all their options. 

Another study titled “Why Don’t People Insure Late Life Consumption?”13

The need for insured, guaranteed retirement choices which can only be provided through fixed 

annuities could not have been any more viscerally demonstrated than in the fall of 2008 and through 

2009. Both a fixed and a fixed indexed annuity guarantee (insure) the purchaser’s initial premium 

payment and prior credited interest. Fixed annuities with interest declared in advance never fall in value 

described the 

importance of framing in economic decisions to shed light on the “under-annuitization puzzle.” Put 

simply, the paper explains, experimental findings suggest that choices are not based solely on material 

consequences, but are filtered through the particular frame that individuals use to view and interpret the 

choices. The study describes them as either an investment frame - how to invest to maximize return and 

minimize risk - or a consumption frame which places the focus on the end result of what can be spent 

(consumed) over time. Stated another way, consumers effectively isolate one choice (how to invest) 

and focus on the specific features of that choice (e.g., risk, return) while ignoring other choices (how to 

consume) so that they miss the broader, integrated set of choices which can be utilized together and 

leveraged for the best possible outcome to meet all outcomes. The study concludes that “framing matters 

in annuitization decisions: in a consumption frame annuities are viewed as valuable insurance, whereas 

in an investment frame the annuity is a risky asset because the payout depends on an uncertain date of 

death.” 

 

13 Jeffrey R. Brown, Jeffrey R. Kling, Sendhil Mullainathan, Marian V. Wrobel, Why Don’t People Insure Late Life 

Consumption? A Framing Explantion of the Under-Annuitization Puzzle, (TIAA-CREF Institute, January 2008)
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 25 of 31 

despite the underlying investment portfolio performance of the insurer and always the required minimum 

interest must be paid. 

Fixed annuities with indexed interest also never fall in value even if the market index drops. So if, 

for example, the indexing formula used the S&P Index and it fell 20% (like it did in 2008), the only 

negative consequence is that no new additional interest would be credited that year above the required 

minimum interest the contract must provide. With all fixed annuities there is never a reduction of the 

account value unless the customer surrenders the annuity prior to the end of the contract period. 

The benefit of including fixed annuities in a retirement income strategy was emphasized in a 

recent article in the Journal of Financial Planning. The article compared wealth management strategies 

for retirees and focused on the trade-offs of wealth accumulation and longevity risk comparing a number 

of distribution strategies that utilized three financial products: mutual funds, fixed lifetime income 

annuities, or variable annuities alongside strategies that utilized various combinations of the three. The 

authors concluded that since none of the strategies dominated, the consumer is best advised to “segment 

wealth to minimize necessary consumption and hedge against longevity risk” rather than focusing on 

growth opportunities. The fact that it did not utilize any of the income opportunities mentioned earlier in 

fixed deferred annuities (such as the very attractive income riders) demonstrates the product bias of the 

securities industry. 

Fortunately for those with a thorough understanding of the guaranteed floor and income elements 

of the fixed deferred annuities, an even stronger conclusion may be made about the potential for both: 

• Insured retirement protection and guaranteed lifetime income for a designated portion of 

retirement funds in the event of investment losses in other areas of the retirement 

portfolio; 

• Income shortfalls from unexpected health or lifestyle events; or, 

• Significant and unplanned increase in inflationary pressures on income. 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 26 of 31 

VI. Product Neutrality and Accessibility 

Today’s American retiree has a disparate assortment of needs, lifestyle choices, lifetime 

expectations and consequences as well as a varied understanding of economic, financial and insurance 

considerations and solutions. The American retiree doesn’t fit into any one category, financial industry, 

product solution or portfolio no matter how “diversified” or “fluid” any of these are. 

There is no magic bullet to meet every retiree’s need but there is a smoking gun that will kill the 

sustainability of retirement income and enjoyment – putting limitations on retirement planning and the 

makeup of a retirement portfolio by mandating product or plan options, or developing rules and regulation 

that will limit plan options to save costs or compliance. 

CHOICE

An open and competitive plan that provides choice of product (both retail and institutional), 

professional planners, and product providers will benefit all involved but most importantly the retiree. It is 

also important that plan participation is voluntary and not mandated by converting 401(k) funds or through 

enrollment in new government programs. NAFA also recommends the integration of Individual 

Retirement Accounts (IRAs) along-side employer-sponsored plans to provide more opportunity for 

retirement fund growth and security. IRAs can be a strong complement to a 401 (k) or other employersponsored plans. They provide the opportunity to diversity product by selecting investment-oriented IRA 

product or a savings protector and insured fixed annuity. In addition, they offer the flexibility to move 

retirement funds among various product alternatives to meet changing goals and market conditions.

EDUCATION 

But choice is nothing if you don’t understand the choices or haven’t had enough information to 

help you make decisions or ask the right questions. To ensure that consumers have all the tools at their 

disposal, NAFA encourages education about the retirement planning process, how to find a planning 

professional, product considerations, common planning mistakes and retirement pitfalls etc. The 

information should be available through internet-based, interactive financial planning calculators, public 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 27 of 31 

forums and Wikipedia information as well as through written brochures and literature. In addition both 

online and telephone chat capabilities should be available for informal discussion and research. 

To ensure that participants are informed and knowledgeable about their retirement needs and 

requirement, the Agencies must require that Plan Administrators or Sponsors ensure participant 

education about retirement planning and planning options with educational tools and calculators and that 

all product providers and advisors develop product-neutral information through all available and 

accessible media – the internet, print and physical or web classroom offering a retirement curriculum. 

EARLY INTRODUCTION 

Early education and starting the retirement planning process could have the most significant 

influence on a successful retirement. The power of tax deferral and time makes a huge difference in the 

amount available for retirement. And, the sooner the planning and savings begin, the more time that 

consumers have to learn more about the process, potential pitfalls, and retirement possibilities. 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 28 of 31 

FIXED ANNUITIES GUARANTEE THAT RETIREES WILL NOT RUN OUT OF MONEY! 

The fundamental challenge facing retirees is how to ensure that they can use their retirement 

savings to sustain their desired lifestyle given that they do not know what future investment returns they 

will generate, nor what future inflation rates will be, nor how long they will live.

An article in the Journal of the Financial Planning Association14

clicking here

explored this issue in depth. The 

authors explored the sustainability of a 4.5% withdrawal rate using various asset allocations. (Obtain a 

copy by ). 

Let’s start with an explanation of a 4.5% withdrawal rate. The authors assumed that the retiree 

has, say, $1 million in retirement savings. If the retiree withdraws $45,000 in the first year (4.5% of the $1 

million), and takes out a higher amount each subsequent year equal to the $45,000 plus inflation, what is 

the chance of the retiree running out of retirement savings before death?

Investment-based Asset Allocations

The answer depends upon the asset allocation used by the retiree. Let’s suppose that the retiree 

uses a balanced asset allocation of 40% stock, 40% bonds, and 20% cash equivalents. The article 

showed (in its Table 6) that using a set of historical returns, there was nearly a 65% chance of the retiree 

running out of money by 30 years later. Even the most optimistic scenario – which assumed use of 85% 

stock and 15% bonds – showed over a 33% chance of the retiree running out of money by 30 years later.

 

14 John Ameriks, Ph.D., Robert Veres and Mark J. Warshawsky, Ph.D., “Making Retirement Income Last a Lifetime”, 

Journal of Financial Planning (December 2001).

Yearly Income Comparison

Year 3 6 9 12 15 18 21

Taxable $678 $765 $864 $976 $1,103 $1,245 $1,406

Tax-Deferred $715 $851 $1,014 $1,207 $1,438 $1,713 $2,040

Additional Income

due to tax deferral 5% 11% 17% 24% 30% 38% 45% 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 29 of 31 

Obviously, results like that demand a better solution. A key conclusion of this article was that 

annuitization – the use of immediate annuities for a portion of the asset allocation – improved the results 

by decreasing the chance of running out of money. But to be fair, at the time of the article, fixed annuities 

had not sufficiently evolved to provide an inflation hedge and to fully eliminate the risk of ruin. Now they 

have.

Inflation-Indexed Lifetime Income Annuity

Some companies offer an inflation-indexed lifetime income annuity. It rates change from time-totime, but using the rates in effect on May 1, 2010 a 65-year-old single male could pay the carrier 

$1,000,000 and receive in return a monthly payment of $4,593, adding up to $55,116 annually, increase 

every year with the Consumer Price Index (the CPI-U).

Notice that this immediate lifetime income annuity supports a 5.5% withdrawal rate and 

completely eliminates the chance of financial ruin. Payments are guaranteed to keep pace with inflation. 

Payments are guaranteed to continue for the rest of the purchaser’s life, no matter how long he lives. 

And the purchaser is completely protected from investment risk.

Suppose that our 65-year-old is married, so he desires payments to continue as long as either he 

or his spouse is alive. The same style of annuity provides a 4.4% withdrawal rate, again with no risk of 

financial ruin whatsoever.

Deferred Annuity with an Income Rider

Purchase of an immediate lifetime income annuity requires the consumer to turn over 

management of the purchase price to the insurance carrier. Some clients would rather retain access to 

their retirement savings. The fixed annuity industry created income riders to satisfy this consumer desire 

and provide guaranteed income for life.

As previously described above, by selecting an income rider, the consumer is provided an income 

that is guaranteed to continue for the rest of his, her, or their lives. Additionally, the amount of the 

payment is guaranteed never to decrease, and for fixed indexed annuities, it increases from time-to-time 
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 30 of 31 

based in part on the growth of a stock market index so long as the withdrawals do not exceed the 

specified amount. Thus, these riders held consumers keep pace with inflation.

At the same time that the consumer has full access to the annuity's value, the income rider pays 

a withdrawal rate of generally of 4% for a single life or 3.5% for joint lives. These payments are 

guaranteed to continue for the rest of the purchaser’s life, no matter how long he lives. And the 

purchaser is completely protected from investment risk.

The conclusion is obvious. Fixed annuity products provide an unparalleled level of safety for 

consumers by providing for a reliable retirement income and a transfer of investment and longevity risks 

to issuing insurers.

________________________________________________________________

NAFA is grateful for the opportunity to participate in this very important and impacting process, and the 

association looks forward to continual dialogue and discussion. We are available at your convenience 

and upon your request.

Respectfully submitted,

Kim O’Brien

Executive Director, NAFA
NAFA: Insuring Retirement with Fixed Annuities May 5, 2010

RIN 1210-AB33 For information contact Kim O’Brien, Executive Director, NAFA at 414-332-9306 or kimobrien@nafa.com

NAFA, the National Association for Fixed Annuities Page 31 of 31 

References

David F. Babbel and Craig B. Merrill, August 14, 2007

“Investing your Lump Sum at Retirement” 

Wharton Financial Institutions Center and New York Life Insurance Company: 1-3.

Dick Duff, JD, CLU, 2010

“Retirement Breakthrough” Green Leaf Book Group Press: 127-155.

Bill Harris, 2010

“75 Secrets: An Insiders Guide to Bank CDs, Annuities, & Retirement Planning”

W.V.H., Inc.,: 175-183, www.75secrets.com.

NAFA, January 2007

“White Paper on Fixed Indexed Insurance Products including “Fixed Indexed Annuities” 

and other Fixed Indexed Insurance Products”© 

NAFA, the National Association for Fixed Annuities, www.nafa.com

Randy Timm, Brokers International, November 2009

“Income Riders a Tutorial” ProducersWeb

Ibbotson Associates, Inc., January 21, 2003

“Why Should Investors Consider Lifetime Payout Annuities in Retirement?”