Retirement Income Journal: “Annuities and the Charles Schwab Deal”

In the Thanksgiving edition of Retirement Income Journal, Kerry Pechter assesses the impact of the Schwabitrade deal. In gobbling up TD Ameritrade, Schwab is consolidating power and RIA custody in one behemoth organization, the impact of which promises to be felt in some predictable and unpredictable ways.

Pechter draws his particular focus on the how the deal may affect the distribution of annuities to RIAs and/or consumers. Both Schwab and TD carry annuities for the Registered Investment Advisory firms who custody assets with them, but both are fairly limited in their annuity choices, and neither actively market their annuity desks or capabilities. Indeed, AITE Group’s Dennis Galant says, “We’re not talking a large volume of annuity usage by RIAs on either platform.”

Will that change? It is certainly difficult to predict what the ultimate impact on annuity adoption among RIAs may be going forward. For now, if the combined organization decides to maintain the status quo, then it stands to reason that we’ll not see much of an uptick in annuity usage on the Schwabitrade platform.

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