To make annuities more appealing — and to bring in more money — insurance companies created more sophisticated types of variable annuities.
Most importantly it will likely make annuities even more expensive for those who do want to buy them.
It is also financing a project to make annuities more affordable and attractive so that more Americans can buy annuities after they retire.
Falling bond yields make annuities more expensive, giving new retirees much less pension income for their money, leaving them permanently poorer in retirement.
It will almost certainly have to be reversed, if it can be .Paul Johnson, the director of the IFS, said the changes could make annuities even more expensive because people who are expected to live longer would be more likely to buy them.
"It will likely make annuities even more expensive for those who do want to buy them.
Would these steps make annuities more attractive by being a better value for the money?
As a result, the new tax rules are likely to make annuities look even less attractive, in comparison to keeping savings in a pension fund.
But Paul Johnson, director of the Institute for Fiscal Studies (IFS), said: "It will likely make annuities even more expensive for those who do want to buy them".
So can we fix these problems to make annuities more attractive to individual retirees, and restore their lost investment and longevity risk protection?
