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2022 Annual Conference

May 19–21, 2022

Sheraton Sand Key, Clearwater Beach, FL, US

Proposal authors can use this tool to see where they have been placed in the program agenda for an Oral or Poster Session.

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Confirm your place in the schedule by going to the ACCI Presenter Confirm Google Sheet and marking your session with the name and email address of the author who will be attending and presenting. Each presentation must have a separate paid registraint. Contact the ACCI Office immedicately by email at admin@consumerinterests.org to report a conflict or if you have questions. Please be sure to reference the session title(s), date(s), and time(s) if you contact us.

A3a Annuity Satisfaction

Thursday, May 19, 2022 at 3:30 PM–5:00 PM EDT
Room 3
Key Words

Annuity puzzle, annuity income product(s), variable annuity (self-annuitization), immediate life annuity (annuitization), annuity decision-making, investment risk, longevity risk, retirement satisfaction

Short Description

Reticence among retirees to protect themselves against longevity risk is an annuity puzzle that has been the subject of vigorous academic debate. As a standard practice, retirement capital is converted into either an immediate life annuity (annuitization), affording significant protection against longevity risk, or a variable annuity (self-annuitization), exposing capital to volatile investment returns. This work presents a number of exploratory factors (based on annuity puzzle literature) that associate with retirees’ satisfaction levels, with respect to the eventual outcome of their annuity choice. The most interesting conclusion is that, although one would expect active involvement in managing retirement capital among variable annuitants to contribute to satisfaction levels, according to the multiple regression results the desire to control and manage variable annuity capital in the pursuance of capital growth, actually significantly contributes to retiree discontentment/dissatisfaction. Financial education and counseling with respect to optimal annuity decision-making could restore the promise of retirement income security.

Submitter

Jeannie de Villiers-Strijdom, Stellenbosch University

Authors

Jeannie de Villiers-Strijdom, Stellenbosch University
Niel Krige, Stellenbosch University
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