A major opportunity is on the horizon for financial advisors: a significant wave of fixed-rate annuity maturities. According to Morgan Stanley analysts, an estimated $70 billion in fixed-rate annuities are set to mature between 2025 and 2027. For advisors, this presents a prime moment to engage clients, review their portfolios, and provide guidance on reinvestment strategies.
Understanding the Fixed-Rate Annuity Boom
Over the past few years, high interest rates have driven a surge in fixed annuity purchases. As those contracts reach their maturity dates, clients will be looking for guidance on what to do next. Many may not be aware of their options, making it essential for advisors to proactively reach out.
Client Engagement Strategies
Here’s how you can position yourself as a trusted resource and help your clients navigate these upcoming maturities:
1. Proactively Identify Affected Clients
Review your book of business to determine which clients hold fixed-rate annuities nearing maturity. Segment them by renewal timelines so you can schedule timely outreach.
2. Initiate Conversations Early
Don’t wait until a contract is about to mature. Start discussions at least six months in advance. Explain potential options, such as:
- Renewing into another fixed annuity (considering current rates and terms)
- Exploring income-generating alternatives like income annuities or bond ladders
- Incorporating tax-efficient strategies for reinvestment
3. Educate Clients on Market Conditions
Interest rates and economic conditions will influence clients’ reinvestment decisions. Provide insights on market trends and how they may impact their choices. Offering regular updates through emails, webinars, or one-on-one meetings can establish you as a go-to expert.
4. Present Tailored Solutions
Each client’s situation is unique. Some may prioritize guaranteed income, while others seek growth opportunities. Assess their risk tolerance, income needs, and overall financial goals before recommending a strategy.
5. Strengthen Client Relationships
This wave of maturities isn’t just about business—it’s an opportunity to reinforce long-term client relationships. Demonstrating proactive service can increase retention and encourage referrals.
Leverage Top-of-Mind Awareness
With billions of dollars in annuity assets soon to be in motion, financial advisors who take a strategic approach will be well-positioned to serve their clients effectively. Start planning now, engage early, and provide well-informed solutions to help clients make the most of their annuity maturities.
One powerful tool that can help advisors capitalize on this opportunity is the IAMS CD Replacement Kit. This kit is designed to equip advisors with marketing materials and sales strategies that highlight the benefits of annuities over traditional CDs. With interest rates hovering in a state of unpredictability and many clients searching for stable, income-generating alternatives, the CD Replacement Kit can help you clearly communicate the value of annuities, making client conversations more effective and impactful.
This free kit includes:
- A 2025 Taxable Equivalent Yield chart to compare returns
- A Split-Annuity strategy guide and checklist to optimize tax efficiency
- Comparisons and calculators for CDs vs. annuities and CDs vs. SPL
- Prospecting emails, a fillable fact finder, social cards, and post copy
- Going Broke Safely and Market Loss Recovery concept pages
Request your IAMS CD Replacement Kit today by calling (800)255-5055 or clicking the link below.
