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Past Event

Better Financial Security in Old Age? The Promise of Longevity Annuities

Past Event

Longevity annuities—a financial innovation that provides protection against outliving your money late in life—have the potential to reshape the retirement security landscape. Typically bought at retirement, a longevity annuity offers a guaranteed stream of income beginning in ten or 20 years at a markedly lower cost than a conventional annuity that begins paying out immediately. Sales have grown rapidly and it will be even easier to purchase the annuities in the future given new Treasury regulations. While economists have touted the attractiveness of longevity annuities as a way to ensure the ability to maintain one’s living standards late in life, significant barriers to a robust market remain—including lack of consumer awareness, questions about product value, and employer concerns with taking on fiduciary responsibility by offering these products to their employees.

Can longevity annuities overcome these barriers to find widespread popularity among Americans retirees? On November 6, the Retirement Security Project hosted a panel of experts to discuss the potential for these products to contribute to the economic security of older Americans, in addition to policy reforms that could lead to greater take-up by retirement plan sponsors and consumers alike. Following a presentation by Katharine Abraham that laid out the issues, two panels of prominent experts added their insights on the promise and challenges of this burgeoning market.

Agenda

Opening Remarks

Panel One: The Economics of Longevity Insurance

Panel Two: Options for Policy Reform

D

Donald Fuerst

Distinguished Fellow - American Academy of Actuaries

Closing Remarks

Presentation: The Market for Longevity Annuities

Katharine Abraham

Director - Maryland Center for Economics and Policy

Professor, Survey Methodology and Economics - University of Maryland

Chair - Commission on Evidence-Based Policymaking

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