By Mark Milbrod
Volatility exposes exactly what a portfolio is built for. President Trump’s “Liberation Day” tariff announcement triggered a sharp, global sell-off, and the S&P 500 fell more than 12% in the first week of April before clawing back nearly all of it within weeks. This was real client money, real fear, real headlines — not a hypothetical illustration.
Two very different client reactions emerged from that stretch:
- Clients without protected income called to sell, turning a temporary dip into a permanent loss.
- Clients with an annuity-based income floor called for reassurance, not liquidation.
Neither client “beat” the market. One simply had a reason to stay in it. This is exactly the environment where behavior, not returns, determines retirement outcomes.
Why do investors lose more money to panic than to the market itself?
DALBAR’s Quantitative Analysis of Investor Behavior answers that question every year, and 2024 was no exception. The average equity investor earned just 16.54% while the S&P 500 returned 25.02% — an 848-basis-point gap, the second largest in a decade. Mistimed exits and re-entries, not weak markets, drove the shortfall. The market didn’t cost investors that gap — their reaction to the market did.
This is the reframe every financial professional needs in the current environment: an annuity was never meant to outperform the market. It was built to remove the single decision that costs clients the most: the panic decision.
Why did some clients call to sell and others call for reassurance?
Two client phone calls define this story:
- The client without a guaranteed-income floor:
Fear drove the call during the April swings. The client’s request was simple: get me out. That single decision, made at the worst possible moment, turned a paper loss into a permanent one — and no market recovery afterward could undo it. - The client with annuity-based income already in place:
Reassurance drove this call, not liquidation. The guaranteed sleeve had already done its job — not by beating the S&P 500, but by giving the client something the market couldn’t touch. That protected piece bought the rest of the portfolio permission to stay invested and recover.
Total U.S. annuity sales hit a record $461 billion in 2025, the fourth consecutive record year, with registered index-linked annuity sales alone climbing 20% year-over-year to $79.6 billion. Demand is colliding with demographics, as more than 4 million Americans turn 65 every year, and most enter retirement without a pension to fall back on, meaning guaranteed income should be a key part of today’s retirement plan.
Reframe your pitch with a single line that captures the entire argument: “I’m not selling you an investment that beats the market. I’m selling you the reason you won’t have to.”
How should financial professionals position annuities after this volatility?
Four strategies turn this market cycle into a practice-building opportunity:
- Lead with the behavior story, not the product spec. Ask clients what they did — or wanted to do — during April 2025. Their own answer builds the case for a guaranteed-income allocation better than any illustration.
- Segment Peak65 clients proactively. 72% of workers say they’d consider adding an annuity to a retirement plan if it were available. Awareness, not appetite, is usually the real barrier; so make so you ask before assuming disinterest.
- Reframe around the behavior gap, not crediting rates. Clients grasp “don’t lose 848 basis points to your own timing” far faster than match and indexing mechanics.
- Position guaranteed income as portfolio infrastructure. Frame it as the floor that lets the rest of the plan stay invested through the next volatility event, not just a competing asset class.
Turning market volatility into a career-building moment
Markets will test clients again. That’s not a risk — it’s a guarantee.
The financial professionals who understand the behavior gap, and who can explain it in plain language, don’t just survive the next volatility cycle. They build their practice on it. Every panicked phone call is a chance to prove what a well-built plan is actually for, and every client who stays invested because you gave them a reason to become your best referral source. The next market swing is bound to arrive sooner or later — make sure you’re ready to turn it into your next opportunity.
