Thank you for sharing!

Your article was successfully shared with the contacts you provided.

At times, dubious financial ideas become best-sellers. Professional financial advisors evaluate these ideas with a critical eye while helping their clients avoid costly mistakes with them. This is the case now with one of the hottest features in variable annuities – a rider called a Guaranteed Minimum Withdrawal Benefit (GMWB). The vast majority of clients who buy this feature don’t understand it, partly because it doesn’t make sense for them.

In choosing a tax-deferred variable annuity, clients participate in a long-term investment accumulation program for retirement. Yet, for the GMWB to make sense, the VA must meet a fundamentally different objective – generating steady retirement income. For purposes of producing retirement income that can preserve purchasing power over time, a VA with GMWB is more costly and less effective than alternatives, including systematic withdrawal plans and immediate variable annuities.

Complete your profile to continue reading and get FREE access to BenefitsPRO.com, part of your ALM digital membership.

Your access to unlimited BenefitsPRO.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical BenefitsPRO.com information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com

Already have an account?


BenefitsPRO Broker Expo 2022Event

The premier educational and networking event for employee benefits brokers and agents.

Get More Information


Join BenefitsPRO

Don’t miss crucial news and insights you need to navigate the shifting employee benefits industry. Join BenefitsPRO.com now!

  • Unlimited access to BenefitsPRO.com - your roadmap to thriving in a disrupted environment
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
  • Exclusive discounts on BenefitsPRO.com and ALM events.

Already have an account? Sign In Now
Join BenefitsPRO
Live Chat

Copyright © 2022 ALM Media Properties, LLC. All Rights Reserved.