Funding Longevity

Income Planning: Like Child’s Play?

Tail in hand, clients need help finding the donkey

by Lori Seaton

Ms. Seaton is Director of Business Strategic Development at Sammons Financial Group. Visit

Keep your eye on the prize. This saying has a rich history, gaining influence as a folk song during the American Civil Rights Movement1. From there, it solidified its place in our everyday culture, with motivational speakers, writers, and bloggers advocating to remain focused on an end goal – do not get distracted by difficulty or setback.

I appreciate this saying; it’s been on my mind many times over the course of my own life. It’s a reminder to persevere during difficult times – those times when it is just darn difficult to stay the course. (I sheepishly have lost count of the many exercise programs I’ve quit after a mere three days). And when it comes to retirement income planning, it is often our own fault when our plan doesn’t come together in the end. Those times we lose sight of the prize.

You know the drill: investors that withdrew their savings during their fragile decade – those critical five years before retirement and the first five years after. It’s fragile because they let their emotions get the best of them during times of volatility. Or those that experienced FOMO – fear of missing out – and choose to invest in more risky financial vehicles that just didn’t pan out. Or, like my failure to maintain an exercise program, those that just didn’t have the discipline to save. When we lose sight of where we’re going, it’s hard to know what path to take.

What’s Really At Play Here?

Is taking the eye off the prize truly the major reason retirement income goals get missed? With nearly 73% of retirement savers interested in independently purchasing a guaranteed lifetime income product that pays out a like a pension,2 it seems another possible reason is at play – it’s not that many failed to stay focused on the prize, it’s that they didn’t know how to attain it.

This tracks with another recent survey, which notes 62% of financial do-it-yourselfers (DIYers) would work with a financial advisor because the advisor could point out risks and opportunities DIYers may have overlooked.3 Understanding the risks and opportunities can ultimately make or break reaching the goals of those facing retirement.

Consider the classic children’s game “Pin the Tail on the Donkey.” Tail in hand, it seems so simple. With a full and close-up view of the target taped to the wall, you can envision where to pin that tail. All you have to do is walk a straight line and pin it to that donkey’s backside – simple. But then you’re blindfolded and perhaps someone spins you around a couple of times. Now go accomplish that simple task. Walking one step in front of the other, you are certain you can find success. It was previously in sight and just a few steps forward in a straight line. You pin your tail with confidence, yanking off the blindfold in anticipation. But your heart immediately sinks as you realize you have gone off course. Your tail is instead pinned to the donkey’s left eye. Ugh, failure.

Keep The Blindfold In Your Pocket

To help pre-retirees reach their prize retirement dream, we need to lose the blindfold and keep them from navigating in the dark. We need to continue to educate clients on retirement-income risks, and the solutions available to help overcome them.

There could be no better time than the present. Insurance companies are innovating solutions to help meet today’s challenges – solutions that are more flexible, richer with consumer value, and better positioned to help solve for today’s financial risks. And with solutions designed to fit within a broader range of advisor practices, these solutions are now more available than ever to financial professionals and their clients. It’s an exciting time to be in this industry.

Annuities: Steady Hand During Times Of Volatility

Last year will be hard to forget. In 2022, the S&P 500 experienced intraday moves of at least 1% (up or down) 122 times, meaning it moved nearly half of all trading days for the year. To put this into perspective, it was more than double the average since 19504. It seemed the market in 2022 was an extra-caffeinated monkey with a yo-yo. Chaos was an understatement, and many of us just wanted to clip the string of that yo-yo, and send the monkey home.

Significant market loss is a risk for investors, no matter the time, but especially during the fragile decade. However, fixed and fixed index annuity owners lost no account value due to any 2022 market loss. None. Most likely no images of monkeys with yo-yos haunting their dreams at night.

That’s due to a feature called annual reset, in which any interest credits are locked in and cannot be lost due to market decreases. The annuity account value visually can appear as a staircase over time, staying flat in market downturns, but increasing in positive years. This can provide that conservative growth potential that can be critical in laying a foundation of strong retirement income for the future.

Annuities: Unparalleled Independent Access To Guaranteed Income

It wasn’t that long ago that consumers could rely on a combination of an employer-sponsored defined benefit plan – or pension – and Social Security to live comfortably in retirement. As access to pension plans continue to dwindle to record lows, and the mounting possibility of a Social Security trust fund depletion in 20335, it’s no surprise that so many savers are interested in a guaranteed lifetime income product that pays out a like a pension.

To help pre-retirees reach their prize retirement dream, we need to lose the blindfold and keep them from navigating in the dark. We need to continue to educate clients on retirement-income risks, and the solutions available to help overcome them...

Enter the annuity. We know an annuity is the ONLY independently purchased financial vehicle on the market today that can guarantee a steady stream of income for life. The ONLY option for those wanting to create their own “personal pension” in retirement. And it’s simple. In exchange for a premium payment to an insurance company, a consumer can purchase an annuity that has three primary powers:

1) Accumulate interest on top of their premium payment over time

2) Stay with them no matter how many job changes they make during their career

3) Carry the option to convert to guaranteed retirement income “paychecks” when they’re ready (or if not, many offer legacy options to leave to beneficiaries)

Much like you insure your home or your car, an insurance-issued annuity is a guaranteed contract that’s there when you need it: in retirement. And for those that add an annuity to their retirement income plan, a whopping 97% say having that guaranteed lifetime income in addition to Social Security is valuable.6

Annuities can also offer many additional lifetime income features, some requiring additional fees, and some that do not. Features that can provide inflation protection, prepare for the rising costs of goods and services, or features to help face the costs of an unexpected health event. With rising health care costs a nagging concern for many, having the ability to access additional funds when you need them could be crucial.

But How Much Is Enough?

How much guaranteed retirement income to plan for is a personal decision, and one that should be done in close collaboration between an advisor and their client. Every retirement plan is unique. However, the process typically starts with a transparent conversation about expected expenses in retirement to uncover any income gaps. Whether that’s done by taking pen to paper or through a financial calculator tool, it’s important for the consumer to have a clear picture of their monthly expenses in retirement, so that they can adequately plan for the income “paycheck” they’ll need.

Let’s Help Them Reach The Retirement Prize Together

Is your client’s eye on the prize? If that prize is that they want to retire comfortably, then yes. I believe most pre-retirees are dialed in on what they want their retirement to look like. Why do you think we see so many retirement advertisements featuring couples walking hand in hand on the beach, enjoying their retirement bliss? That’s why I perpetually catch my own husband watching YouTube videos on the “4% rule” and ideal Social Security withdrawal strategies. Consumers know what they want, they just need help and confidence to get there.

So where do we go from here? Let’s return to our childhood days of pinning that tail on the donkey. We in the insurance and financial services industry must help pre-retirees remove the blindfold, so they can navigate their way. Insurance companies must innovate their products for even greater customer value, industry trade organizations must educate on guaranteed lifetime annuity products, and advisors ultimately must put them in front of their clients. It will take all of us to light the path to their prize and build retirement confidence.




For more education on the value and benefits of annuities, check out industry trade organization’s websites, such as National Association for Fixed Annuities ( or Indexed Annuity Leadership Council (
The views and opinions expressed are Lori’s views and opinions as an individual and do not reflect the views and opinions of Sammons® Financial Group, Inc.
1. Source: Wikipedia,Progressive%20Club%20on%20Johns%20Island
2. Source: Survey conducted by the American Council of Life Insurers (ACIL),have%20a%20pension%20(68%25)
3. Source: The Wild Cards of Retirement, Wealth Management IQ, 2023
4. Source: NPR,part%20to%20slower%20economic%20growth.
5. Source: Plante Moran blog,double%20the%20average%20since%201950.
6. Source: Alliance for Lifetime Income study


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