As I have discussed over last two years, Income riders charges are up, payout factors down and most products produce less than a 1% IRR at client life expectancy.  
 
Income riders are falling even harder than I expected.  
 
According to LIMRA:
“One of the factors driving VA sales declines has been a drop in sales of products with guaranteed living benefit riders,” noted Giesing in a statement. “LIMRA Secure Retirement Institute is expecting sales of variable annuities with a GLB rider to be around $50 billion in 2016. This is a decrease of nearly $20 billion from last year and a drop of over 50 percent from just 5 years ago.”
 
It’s only a matter of time before the reality of income rider payouts hits the FIA world and the public stops buying secondary account features at a high cost to their heirs and a 50% chance of earning less than 1% over the life of their annuity due to high fees and charges. 
 
What can you do now? Give your clients and prospects the same level insight that you now have available, so they can make an informed decision. 
 
Income Under Management™ which uses a mathematically sound process to calculate systematic withdrawals and provide a SPIA estimate at a later age in the event a client wishes to purchase a guaranteed income stream at that point. The net effect results in an average increase of $100,000 in saved fees for not choosing an income rider and focusing on a low or no-fee accumulation product with a strong participation rate.
 
After AnnuityCheck™ updated SPIA rates for the month, a 65-year-old male would need $3,218 less to generate a $20,000 guaranteed income at age 83. $151,103 vs. $154,321 before the 1/4 % rate hike.  
 
Are all income riders evil? Absolutely not, but without knowing the numbers and the odds, your clients and you are in the dark.