Psst! Hey, buddy. Wanna know a sure-fire way to sell an annuity?It's been scientifically proven to work. All you need to do isre-frame the perspective of the buyer and—WHAMMO!—the sale ismade.
If this sounds too good to be true, it probably is. But researchshows if you shift the perspective of retirement investors fromthinking “lump sum” to thinking “monthly payout,” you have a betterchance at selling that annuity—with two important caveats.
In a paper, “The Illusion of Wealth and Its Reversal,”researchers Daniel Goldstein, Hal Hershfield and Shlomo Benartziattempt to answer the question, “Why do people more often choosethe lump sum option instead of the annuity?” What they discoveredmay shed some light on, and help, annuity sales. It may also showthere's a brick wall out there through which no annuity canpass.
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