Rethinking whether annuities are too late for older retirees

Some of the most meaningful cases I've closed began with a prospect saying "No." Typically not a firm rejection, but a quiet assumption that their opportunity had passed.

"I'm too old for an annuity" ranks among the most common self-disqualifications I encounter, and it represents one of your greatest untapped opportunities.

These prospects aren't uninterested in guaranteed income. They're misinformed about how annuities work, when they're most effective and who benefits most. Your ability to correct this misconception can transform the retirement security of those who need your knowledge most. Let me show you how to turn age-based objections into compelling reasons to act immediately.

Empower prospects with data-driven confidence

Just last month, a 72-year-old prospect told me she was "past the point" of considering guaranteed income. I showed her the numbers: roughly 16% of SPIA contracts are purchased by buyers aged 70-74, and 23% by those aged 75-84. Purchases continue well past age 85 (13%), demonstrating sustained market demand and carrier confidence in late-age buyers. She signed the application three days later.

Age doesn't disqualify prospects from annuity benefits. In many scenarios, their age provides distinct financial advantages that younger buyers cannot access.

Demonstrate the payout premium advantage of annuities

Here's what most prospects don't understand: Insurance carriers use age-adjusted mortality tables to price contracts, rewarding older purchasers with superior monthly income. A $100,000 immediate annuity at age 70 pays roughly $675-$708 monthly for males and $642-$675 for females—significantly higher than what younger buyers receive. Payouts increase between ages 65 and 75 based purely on actuarial mathematics.

The "sweet spot" for starting a guaranteed income commonly falls between ages 70 and 75. Delaying purchase isn't missing the opportunity — it's maximizing the payout.

Harness the market momentum of Peak 65

Peak 65 isn't slowing down — it's accelerating. LIMRA projects 2026 annuity sales will remain above $450 billion, marking sustained momentum from four consecutive record years. What's driving this surge? More than four million Americans turn 65 each year— creating the largest retirement wave in history.

The U.S. population aged 65+ is expected to grow by 7.5 million between 2023 and 2027. These retirees face a reality that previous generations didn't: Only one in five Americans under 50 has a defined benefit pension. Annuities fill the guaranteed-income gap that their parents took for granted. It’s our role to help bridge the gap between what employer pensions once provided and what modern retirees must now secure independently.

How to deploy annuities for older clients

Late-age annuities solve three timing problems you're already hearing in client conversations: bridging the Social Security gap, reducing required minimum distribution tax burdens and guaranteeing legacy income when traditional tools fall short. Each application addresses a specific pain point that positions you as the strategic advisor who delivers solutions, not just products.

1. Social Security optimization. Period-certain annuities bridge ages 62-70, allowing clients to delay Social Security while maintaining cash flow. A 65-year-old who defers taking a deferred income annuity until age 75 could receive $1,401 per month, rather than immediate payouts. Present this during initial discovery when prospects mention concerns about retirement timing.
2. RMD reduction. Qualified longevity annuity contracts allow investors to exclude up to $210,000 from RMD calculations (as of 2025) while deferring payments to age 85. This strategy lowers clients' taxable income in their 70s while guaranteeing cash flow as other sources naturally decline. Introduce QLAC strategies during year-end planning conversations with affluent prospects managing substantial IRA balances.
3. Legacy certainty. Period-certain payout annuities work effectively for clients into their 90s, creating contractual guarantees for both owners and beneficiaries. This addresses both income security and estate planning objectives in a single, streamlined solution.

Address the objection head-on

The clients who need guaranteed income most are precisely those who assume they no longer qualify. Prospects expressing age concerns aren't necessarily objecting—they may need some education.

When a client claims they're "too old" for annuities, I reframe the conversation around certainty. Research shows 88% of annuity owners say their contracts ease worries about market downturns, while 92% report annuities make finances easier to manage in older age when decision-making becomes harder.

The question isn't "Am I too old?" They should ask, "How can guaranteed income protect the retirement I've spent decades building?"

Age brings higher payouts, not disqualification. Remember, your older prospects aren't too late —they're right on time.

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Lucas Vandenberg is CEO of PSM Brokerage, an AmeriLife company. Contact him at [email protected].