Bank Annuity Sales Down, Annuity Sales Up?
“Bank Annuity Sales Down, Annuity Sales Up??”
What’s up with that headline?
Well, it accurately summarizes our sideways marketplace and ‘muddle-through’ economy.
It’s easy to get confused. But what’s going on is this- the economy is slightly more stable, and the sales of annuities by banks is up to $2.8B in June of 2010, which is better than the $2.2B sales in January of 2010, when there was even more trepidation in the marketplace and investors were not making any moves.
That said, the June ’10 annuity sales numbers are sharply lower than the June ’09 levels of $3.6 Billion. Why the fall-off?
The answer is Interest rates. Yields on fixed annuity products are at disappointingly low levels in recent months. These fantastic products are unfortunately not really compelling or competitive right now due to the overall low rate environment. Plus, as the economy seems to be stabilizing ** (be wary of this, however) people may be creeping back into markets and not racing for the safety and security that fixed annuities can offer.
What do you think about these annuity sales trends?
This is a challenging marketplace for any investor, and the term “Muddle Through Economy” is quite appropriate. The term comes from an analyst we greatly respect here at www.AnnuityStraightTalk.com.