More Americans appeared to take advantage of attractive savings rates on fixed annuities by investing in the products, according to a report.
The Beacon Research Fixed Annuity Premium study reported overall sales for the products climbed to $18.9 billion during the first quarter, a 6 percent rise from the previous period. It was the first quarterly increase for fixed annuities in two years, said the report, and showed more Americans were looking to take advantage of a strong rate of return on the investments at a time when many were concerned about their retirement income.
"Fixed rate annuities benefited from higher rates in first quarter," said Jeremy Alexander, CEO of Beacon Research. "They had a strong rate advantage over CDs in many banks. The steep yield curve made longer term rates particularly attractive and sales moved longer as a result."
Seniors looking to diversify their retirement savings are looking toward a number of options, including annuities. The contracts essentially ensure income paid out by a life insurance company over a period of time.