Security Benefit

Security Benefit is a Kansas-based financial services company that provides investment and retirement solutions through independent financial representatives. 

Security Benefit has approximately $30 billion in assets under management and distributes its products through a network of 27,000 financial advisors.

Security Benefit Life Insurance Company is the provider of Security Benefit's annuity offerings.  Annuity products offered by Security Benefit include both fixed annuities and variable annuities.

Security Benefit was acquired in 2010 by a group of private equity investors led by Guggenheim Partners.

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Products Offered


General Information
Websitehttp://www.securitybenefit.com
TypeInsurance Company
Founded
Ownership
CountryUSA
Contact Information
AddressOne Security Benefit Place
Topeka, KS 66636-0001
Phone800-888-2461
Fax

Information & Articles about Security Benefit

There is a case to be made for home equity as the most important source of retirement funding in the United States, and this would seem to make the reverse mortgage a critically important consumer financial product since the reverse mortgage allows an individual to convert home equity into cash.

The reason is that home equity represents a significant portion of the net worth of most retirement age households in the United States.  Consider, for example, some of the following statistics:

  1. 31.9 percent for ages 55-64 (these households do have some form of individual retirement account balance).
  2. 34.7 percent for ages 65-74 (these households do have some form of individual retirement account balance).
  3. 47.4 percent for ages 75+ (these households do have some form of individual retirement account balance).
  4. 30.2 percent for ages 55-64 (these households do not have any form of individual retirement account balance).
  5. 51.7 percent for ages 65-74 (these households do not have any form of individual retirement account balance).
  6. 59.8 percent for ages 75+ (these households do not have any form of individual retirement account balance).

Further, consider the following:

  • Many households in the United States have little or no retirement savings.  A recent EBRI survey indicates that 56 percent of households report less than $25,000 in retirement savings.
  • Median household income in the United States in 2009 (all age groups) was $49,777.
  • Using an 85 percent replacement ratio and the all-age-group median household income figure above, a very rough estimate of median household retirement income needs is $42,310 per year.
  • The average Social Security benefit for a retired couple in the United States (2011 data) is $22,884.
  • Using the highest end of the retirement savings range ($25,000) for the 56 percent of U.S. households referenced above, it can be assumed that private retirement savings can generate an additional $1,430 per year in income (through a $25,000 purchase of a single premium immediate annuity).
  • Other sources of retirement income such as defined benefit pension plans have become much less prevalent over the past several decades.
  • For tens of millions of U.S. households, there is an enormous gap between median retirement income objectives and the savings that can be used to fund those objectives: 
    • Retirement Income Needs ($42,310) - Social Security ($22,884) + Annuity ($1,430) = Retirement Income Funding Gap ($17,996 per year).

The retirement funding gap of $17,996 per year is in the range of the average Social Security benefit.  Based on current life expectancies, the amount required to finance $18,080 through retirement is in the range of $300,000.

Home equity is a natural and necessary source of cash for retirement financing because neither government nor personal savings will be capable of assuming the obligation.

With roughly 10,000 people retiring each day for the next 20 years in the United States, it’s amazing that there are not entire venture funds dedicated to reverse mortgage start-ups.

 

4,704 reads

The average Social Security benefit is about $14,000 per year.

This is according to Wall Street Journal columnist Brett Arends who--as usual--wrote an interesting piece in today's Journal.

The story can be viewed by clicking here (subscription required).

The article discusses Social Security in the context of the recent tax deal that cuts payroll taxes for a year and subsequently affects the viability of Social Security.

It's a great read with useful comparisons of Social Security and private immediate annuities.

 

3,284 reads

Through the Senate Special Committee on Aging, U.S. lawmakers and regulators have been conducting hearings focused on retirement security issues.

The hearings are a follow-up to a recent request for comment on the same topic from the U.S. Labor and Treasury Departments.

Longevity risk is a fundamental concern that appears to be driving both the request for comment and the Senate hearings.

Lawmakers are legitimately concerned about the fact that millions of U.S. retirees will either have insufficient funds or simply run out of savings during retirement.

According to one testimonial:

Most American households at or near retirement “are consumed by fear...Instead of walking on the beach hand-in-hand in retirement, the reality is that they’re sitting around the kitchen table cutting coupons.”

Some of the facts supporting the testimony and concerns include:

  • 47 percent of those on the verge of retirement are predicted to run out of money as they will not be able to cover their basic expenses and uninsured healthcare costs.
  • The average 401k balance as of March 31 was $66,900.
  • The average monthly Social Security benefit as of April was $1,067.
  • Current life expectancy for a 65 year old U.S. male is 82.  For a 65 year old U.S. female it is 85.
  • In 1983, 62 percent of U.S. workers had only a company-funded or traditional defined benefit pension plan, while 12 percent had 401ks.
  • In 2007, 17 percent of U.S. workers had only a company-funded or traditional defined benefit pension plan, while 63 percent had 401ks.

Source: Bloomberg Business Week

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