Did you know the roots of modern annuities trace back to the Civil War era? These early innovations paved the way for today’s retirement solutions.
The Birth of Annuities in America
In the 1860s, the Union government stopped giving land to injured soldiers. Instead, it started providing annuities. This marked a significant shift in how the nation assisted its veterans. President Abraham Lincoln felt it was the nation’s responsibility to provide financial security to those who served the Union.
President Ulysses S. Grant tried to reduce annuities for Civil War veterans. He wanted to extend financial aid to a broader population. But the Supreme Court ruled against Grant maintaining the veteran’s annuities.
From Battlefield to Retirement Plans
As the years past, annuities expanded from supporting veterans to assisting all people planning for retirement. At first, annuities gave injured soldiers and veterans guaranteed income. Then they began providing money for the families of soldiers who had died too.
As the government realized how useful annuities were for providing financial security, Congress finally approved expanding these plans to civilians, not just military members. More people started to see the appeal of annuities and getting guaranteed income for life. This led to annuities being used by a much wider population looking to have a stable retirement.
The primary purpose of annuities remains unchanged since Lincoln’s time: to offer dependable income for those who need it. As pensions from employers became more common, annuities served as a means for workers to save extra funds for retirement alongside their pensions. By investing in an annuity, individuals could grow their money until retirement and receive a consistent monthly income to complement Social Security and pension benefits.
Technology Changes Everything
Over time, annuities evolved from a government-only offering to a product sold by insurance companies to assist people in saving for retirement. This shift led to the rise of annuity advisors.
Today, annuities are more complex than they were in the 1860s. They have many more features and options. Because of this, advisors play an even bigger role today than they did in the 19th century. But annuities continue to evolve and in this current economic environment, demand remains strong. To keep pace with these changes, advisors must leverage technology.
While the goal of annuities remains the same —providing guaranteed retirement income— technology is also changing and expanding how consumers buy annuities. If you’re not up to date on your sales automation technology, you’re missing opportunities to be more efficient and have a better process.
Advisors can digitally collect data at the beginning of the sale, making it faster and more efficient. Advisors can efficiently compare multiple annuity products and identify the most suitable option for each client’s specific requirements. Online order entry systems have simplified the process of submitting applications and buying that retirement security. Consumers can get their annuity delivered electronically within minutes instead of weeks.
These technological advancements have streamlined the process of buying and owning annuities. It’s faster, easier, and more accessible to the average person. The digital revolution has brought these products a long way from their origins in the Civil War era. Now they can help more people achieve a secure retirement.
Looking Ahead
The annuities of the 1860s laid the foundation for today’s retirement planning landscape. Today’s advisors can continue the financial security promise made to Civil War veterans. With the help of modern technology, they can drive annuity growth so that future generations know that security as well.
Are you ready to switch to a digital sales process? Discover how our innovative solution can make life easier for your advisors and clients and boost your bottom line.
Request a consultation here or contact sales at 719.442.6400.
