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Americans care about their financial futures, and many are taking a more active role in turning years of hard-earned savings into retirement income. But even with constant access to financial information, building a dependable plan for the future feels out of reach for many.
For example, our research shows 60% of Gen Z and Millennials feel unsure about how to prepare for their retirement years. (YouGov, Financial Confidence & Independence, Jan 17, 2025)
This uncertainty isn't limited to younger adults. Workers across all generations feel far less confident about making their savings last throughout retirement. Only one in four workers feels very confident their money will last. This highlights a major gap between saving for retirement and knowing how to turn those savings intoregular income. (EBRI/Greenwald, Retirement Confidence Survey, April 24, 2025)
In the middle of this challenge are annuities. They're widely recognized but not as well understood as other savings tools like certificates of deposit (CDs). Only 14% of Americans own an annuity. While nearly half of those surveyed say they understand what an annuity is, only 23% have ever considered buying one. This gap shows awareness doesn't translate
When asked to explain how they work, many describe them as confusing or meant only for the wealthy. Even consumers with strong financial literacy say they require heavy research. These insights show people are interested in learning about annuities. But they're not finding the resources that make them easy to understand and compare. This disconnect — between recognition and real understanding — is the heart of the annuity gap. (YouGov, Financial Confidence & Independence, Jan 17, 2025)
Closing the gap means changing how people learn about and purchase annuities. Gainbridge℠ is leading this shift by providing digital-first educational resources about annuity products.
The knowledge gap: Where misunderstanding begins
The annuity gap becomes clearer when you look at how people learn about financial products. Many Americans recognize the term "annuity," but far fewer understand how these products work. This disconnect spans every generation.
Self-directed learning has become the norm. Young investors (38%) prefer to research on their own, and there's plenty of knowledge to be gained by listening to podcasts and watching YouTube videos. This approach gives people control and lets them explore financial topics on their own terms. (YouGov, Financial Confidence & Independence, Jan 17, 2025)
And they're not alone. Workers across all generations increasingly rely on online tools and research when evaluating financial products. These resources give people control over how and when they learn. (EBRI/Greenwald, Retirement Confidence Survey, April 24, 2025)
But while people want to learn, they're not getting the right information. Even with more resources available, the financial landscape isn't easy to navigate. Many personal finance topics, especially those focused on retirement, can be difficult to interpret. That complexity can lead to confusion. (CBS News, Personal finance advice doesn't work for most Americans, economists say, December 2, 2025)
Without that clarity, misconceptions take hold. Around 40% of Americans say annuities feel complex, and 25% believe they're only for high-net-worth individuals. These perceptions may discourage consumers from evaluating whether an annuity is appropriate for their individual circumstances. (YouGov, Financial Confidence & Independence, Jan 17, 2025)
Even Americans with expert-level knowledge report similar challenges. People (65%) who consider themselves highly informed still describe annuities as research-heavy and time-intensive. This shows that more knowledge doesn't automatically translate to more confidence. (YouGov, Financial Confidence & Independence, Jan 17, 2025)
These factors combine to create a high barrier to entry that keeps many people — young and old — from considering annuities. And it's not because they lack interest, but because they lack accessible, trustworthy guidance.
A generational divide in retirement readiness
Retirement confidence varies across generations, and it's especially noticeable when annuities enter the conversation. Younger adults feel the most uncertain about long-term planning. Nearly 60% say they don't know how to prepare for their retirement years. And annuities rarely come up when thinking about how to save for retirement. (YouGov, Financial Confidence & Independence, Jan 17, 2025)
Older adults face a different challenge. They understand the value of predictable income, but many still lack confidence in choosing the right product. And only 24% of workers, including those close to retirement, feel very confident their savings will last. (EBRI/Greenwald, Retirement Confidence Survey, April 24, 2025)
Meanwhile, older Americans who've purchased annuities use them to convert savings into a a predictable income stream. Depending on the annuity type and the payout option elected, these payments may be for a set period or for life; lifetime income generally requires annuitization or election of a lifetime income rider.
This contrast highlights the role of exposure to the right knowledge and advice. People who understand how annuities work are more likely to see their value. This becomes clearest during major life changes. Many people boost their retirement savings after a career change or family shift. But only 23% consider annuities despite stating their goal is retirement security. (YouGov, Financial Confidence & Independence, Jan 17, 2025)
Across all generations, this hesitation is a missed opportunity. Limited awareness of annuities means people are overlooking a tool that supports long-term planning. Whether someone is early in their career or nearing retirement, limited familiarity with annuities makes it harder to see how they fit into a long-term plan. Whether an annuity fits a particular retirement plan depends on age, tax situation, existing retirement assets, liquidity needs, risk tolerance, and other factors.
Bridging this gap means providing clear guidance that helps consumers understand annuity features, costs, and risks so they can decide whether an annuity is appropriate for their situation.
What annuities can and cannot do
Annuities are insurance contracts issued by an insurance company. Depending on the type of annuity and the options elected, they may complement other retirement savings vehicles such as a 401(k) or IRA. Whether an annuity is appropriate depends on individual circumstances.
Here's what an annuity may offer, depending on the type of annuity and the contract terms:
• Provide a guaranteed income stream: Annuities turn a portion of your savings into a steady paycheck, helping to cover daily expenses throughout retirement. Certain annuity types (immediate annuities, deferred income annuities, or contracts with a lifetime income rider) can provide periodic payments for a set period or, if a lifetime option is elected, for life.
• Protect against market volatility: Other investments rise and fall with the stock market. But fixed annuities offer a buffer, protecting your portfolio from sudden downturns. Fixed annuities and income annuities do not participate in stock or bond market returns, so the account value of these products is not directly reduced by market declines. Variable annuities and registered index-linked annuities (RILAs) involve investment risk, including possible loss of principal.
• Support long-term planning: Knowing how much income you can expect makes it easier to budget and plan for the future without the guesswork. Fixed and income annuities specify payment amounts under the contract terms. Fixed annuity payments generally do not adjust for inflation unless an inflation rider is elected (at additional cost); the purchasing power of level payments may decline over time.
• Fill the gaps in your portfolio: Annuities work alongside your other investments, providing a layer of protection that IRAs and 401(k)s alone may not offer. Annuities held outside of a qualified retirement account offer tax-deferred growth on earnings. Annuities are about peace of mind and reliability. They help everyday people build a solid foundation, reduce anxiety about the future, and strategically map out their retirement.
Transparency, trust, and the modern consumer
Nobody likes a pushy sales pitch. Modern investors, especially those under 40, want clarity and control. Around 38% of young adults are now using digital tools and self-guided lessons to research on their own terms. They aren't looking for a third-party intermediary to tell them what to invest in. Instead, they want the freedom to learn, and they're seeking out educational content on their own.
And that expectation for clearer, more trustworthy information isn't limited to younger adults. People across all age groups don't want to feel pressured into buying products. Instead, they want their trust restored through transparency and relevance. (Accenture, Banking Consumer Study, 2025)
When retirement planning resources are easier to navigate, consumers may be better equipped to evaluate annuity products alongside other options. An annuity is one of several tools that may or may not be appropriate for a retirement plan.
Closing the gap: What consumers need most
Today's investors want clarity and control. When designing a retirement plan, they generally benefit from:
• Simple explanations. Understanding how an annuity works is the first step toward evaluating whether it is appropriate for their retirement plan.
• Real-life examples showing how annuities may fit alongside an IRA or 401(k).
• Side-by-side comparisons that help consumers independently evaluate options.
• Transparent fees. Upfront pricing showing all applicable contract charges (surrender charges, market value adjustments, rider fees) helps consumers make informed decisions.
• Digital-first experience for research and purchase.
How Gainbridge℠ approaches the annuity gap
Gainbridge℠ meets these needs head-on. We don't just sell annuities. We help you understand, compare, and confidently integrate them into your retirement plans. Gainbridge℠ offers straightforward, no-commission annuities and interactive calculators that put you in the driver's seat.
What's ahead
At Gainbridge℠, we believe consumer education helps investors evaluate annuity products alongside their other retirement options. 61% say they're more likely to work with a firm that prioritizes teaching over selling. (YouGov, Financial Confidence & Independence, Jan 17, 2025)
Among investors who say they understand annuities well, only 14% actually own one. That gap may reflect a lack of practical information — or, for some, a considered decision that an annuity is not appropriate for their situation.
Our approach is:
• Transparent: Straightforward products with no hidden fees or confusing jargon and with disclosure of applicable contract charges.
• Modern: Digital-first tools and self-serve resources.
• Empowering: Education-driven content.
• Inclusive: A platform designed for every age group.
Discover digital-first annuities from Gainbridge℠
Gainbridge℠ works to simplify annuities and deliver modern, education-driven tools. Explore Gainbridge℠'s new generation of annuity products and take charge of your retirement planning. Learn more about the features, costs, and risks of these products to evaluate whether an annuity may be appropriate for your retirement plan.
Disclosures
This article is for informational purposes only. It is not intended to provide, and should not be interpreted as, individualized investment, legal, or tax advice.
Annuities and CDs are fundamentally different products: CDs are bank deposits insured by the FDIC up to applicable limits; annuities are insurance contracts, are not FDIC-insured, and rely on the claims-paying ability of the issuing insurer.
Withdrawals of taxable amounts are subject to ordinary income tax and, if taken before age 59½, may be subject to a 10% federal tax penalty. Withdrawals may also be subject to surrender charges and market value adjustments during the surrender charge period. Annuities held within qualified retirement accounts (e.g., IRAs, 401(k) plans) do not provide any additional tax-deferral benefit beyond that of the qualified account itself.
Lifetime income requires election of an annuitization option or a lifetime income benefit rider, which may be irrevocable, may reduce your account value, and may involve additional charges. Fixed annuity payments generally do not adjust for inflation unless an inflation rider is elected.
Sources
Accenture, Global Banking Consumer Study 2025
CBS News, Personal finance advice doesn't work for most Americans, economists say, December 2, 2025
Employee Benefit Research Institute, Retirement Confidence Survey 2025, April 2025
YouGov, Financial Confidence & Independence, Jan 17, 2025
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