I will admit this week my blogging ideas were a bit scant; this is not to say I was bereft of topics but some of them need a bit more time to percolate, if you catch my drift.

Thus, to get some inspiration, I did a random web search on the term “annuity,” and, among the results, I found an article that suggested “annuity interest rates are compelling right now.” That sort of stuck in my mind because it seems to me that nearly every kind of annuity should be looking pretty good right now, all things considered.

The fairly strong returns of the stock market (the S&P 500 is up about 9% year to date, including dividends) should be making variable annuities, RILAs and indexed annuities look good to investors who are craving growth. For the more risk-averse, MYGA crediting rates of 5% or more are available, even on shorter-duration contracts.

And that’s just the deferral side of the equation. The article said that at present, a 65-year-old can obtain an immediate annuity payout of 7% as compared to much lower rates just a few years ago. From what I gather, that percentage is arrived at by dividing a payout quote in dollars by the amount of premium paid into a SPIA. If that’s how it’s done then I have seen annual rates of 8% for men ages 70, according to the CANNEX web site.

The article had a link entitled “Get started with an annuity while rates are still high here today…” which led to a short list of preferred insurance company providers; it made think if such messaging is making its way around the industry. It’s been a thing before, let’s be honest. But somehow, I think the fire sale mentality is not prevalent at the moment. Oh, and if Federal Reserve rate cuts cause insurers to lower their deferred annuity crediting, my experience is that income annuity rates tend not to fall as much, if at all.

What else did I find in my search? An article with this headline: “Deferred annuities are better deals than immediate annuities.” That was rather provocative, if you ask me. I read the piece and found its conclusion rather murky and not entirely convincing (I didn’t think it sufficiently backed up the sentiment of the title); I’ll admit I have not yet looked through the academic study that was the basis of it. I will get to that at some point soon

Here’s a closing question: since we have such a plethora of annuities out there (not to mention a ton of benefits and features), will we eventually get to the point where there is more open competition between them? That might be a good thing, since it would suggest that advisors and agents might be showing potential buyers the pros and cons of different product types – and presenting them with more than one option – before getting them to sign on the dotted line…whether on paper or electronically.