Coinciding with June being annuity awareness month, LIMRA released its first-quarter report, showing a 1% increase in annuity sales compared with the same period in 2025. They reached $107.4 billion, according to its Individual Annuity Sales Survey.
Yet, while sales also represent a 9% decrease from the previous quarter, they have now recorded 10 consecutive quarters above $100 billion, showing sustained strong demand for annuities.
“Consumers continue to prioritize solutions like annuities that provide financial protection and guaranteed income because they directly address some of the biggest risks facing retirees,” said Kush Kotecha, president of Nationwide Annuity.
For example, uncertain economic conditions such as inflation, interest rate changes, and stock market fluctuations can be balanced through annuity solutions that reduce exposure to volatility and provide predictability through guaranteed income, Kotecha added.
How Economic Uncertainty Is Driving Annuity Sales
The current economic landscape can be tricky for retirees. The direction of interest rates remains uncertain under Kevin Warsh, the new Federal Reserve chair, as inflation is still sticky. In May, the Consumer Price Index stood at 4.2%, the highest in three years.
What’s more, the increase in healthcare premiums since the start of the year has also strained savings. And of course, increased lifespans sometimes mean stretching budgets.
Kotecha said that annuities can remove the risk of outliving retirement savings.
According to research from the Nationwide Retirement Institute and the American College of Financial Services, extending a retirement by just five years from 30 to 35 years increases the risk of exhausting savings by 41% based on historical market returns, he said.
“That risk intensifies as lifespans lengthen, making annuities offering guaranteed income even more crucial,” Kotecha added.
Annuities are also among the few investment products that can help navigate challenging economic environments, and consumers are hearing this message loud and clear.
“The annuity industry has been focused on creating guaranteed solutions that meet customer investment objectives throughout the investment lifecycle. Through product innovation, there are annuity solutions that can address various risk tolerances, time horizons, legacy, long-term care, or income needs, while also providing guarantees,” according to Kotecha.
Why Annuities Remain a Strong Retirement Strategy in 2026
Simply put, because uncertainty is exactly what sends people looking for certainty, as Michael Hess, vice president, WestPac Wealth Partners, put it.
“When the headlines are noisy, inflation that won’t fully cooperate, a Fed that keeps everyone guessing, geopolitical flare-ups, the average person nearing retirement doesn’t get excited about chasing an extra point of return,” Hess said.
The few years right before and after you stop working are the “retirement red zone,” and a big loss in that window is very hard to recover from because you no longer have a paycheck refilling the account, and you’re now pulling money out instead of putting it in, he said.
In turn, guaranteed income solves the scariest unknown in retirement, which isn’t “what will the market do this year,” it’s “will my money outlast me.”
“An annuity converts a pile of savings into a known monthly number a retiree can count on, no matter what the market does, the same way a pension used to. And since most people retiring today don’t have a pension, they’re essentially being asked to build their own,” he said, adding that’s why protection and guaranteed income keep rising to the top of the list even when, especially when, the rest of the picture feels shaky.
Of course, all eyes will remain on interest rates.
Kotecha said that Nationwide’s Office of Economics believes the Fed will hold rates steady in 2026. If rates do move lower, however, fixed annuities could become less popular, although the heightened equity market volatility we’ve seen could continue to drive demand for principal protection and buoy fixed annuity sales.
How Advisors Can Differentiate When Selling Annuities
“Stop selling and start teaching,” said Hess, adding that most clients walk in with some skepticism about annuities, “often based on something they half-remember from a decade ago,”
Another piece of advice: lead with the plan, not the product.
He said that an annuity shouldn’t be a standalone pitch; it should be the piece that solves one specific problem, usually creating a reliable income floor that covers the essentials.
“Advisors who understand a client’s whole financial picture, and can show exactly where an annuity fits inside it, win against the person down the street who’s just quoting a rate,” he said.
He also noted that the conversation around annuities has fundamentally changed: for years, annuities carried a stigma, and a lot of that was fair; the old products could be expensive and inflexible.
“But the industry has done real work, and today’s products, registered index-linked annuities (RILAs) especially, are far more flexible and transparent,” he said. “The result is that annuities have moved from a niche product to a mainstream retirement tool, and the discussion has shifted from “what rate of return can I get” to “how reliable is my income.”
