Retirees seeking the security of guaranteed income from annuities may be indirectly exposed to the riskier corners of the credit market. According to the 2026 Goldman Sachs Asset Management Retirement Survey & Insights Report, 83% of respondents said they want some form of guaranteed income in retirement. The survey, released Monday, polled 5,106 Americans in July 2026, including 3,612 working individuals and 1,494 retirees aged 45 to 75.
During a media panel discussing the findings, Wyatt Lee, head of target date strategies in the global multi-asset division at T. Rowe Price, noted that private credit has become a significant component of annuity portfolios. "Private credit is becoming a big piece of the underlying holdings in the annuity space, and that's probably a good thing because private credit has, over the years, taken on a significant part of what traditional public capital markets had covered before," Lee said. He added that private credit is essential to the strategic asset allocation process for building diversified portfolios that generate needed income.
T. Rowe Price, where Lee co-manages target date portfolios, reports that roughly two-thirds of its $1.9 trillion in assets under management is tied to retirement. The firm's perspective underscores the growing intersection between retirement products and alternative credit markets.
Life insurers, which sell annuities in exchange for lump-sum savings, have increasingly turned to private credit to boost yields. Research from the Federal Reserve Bank of Chicago, cited by Axios, shows that life insurer investments in private credit reached $849 billion in 2024—more than double the level in 2014. This rapid growth has drawn attention from regulators and rating agencies.
However, the heightened exposure comes at a time of stress in the private credit market. Fitch Ratings reported in mid-September that the trailing 12-month default rate for U.S. private credit borrowers hit a record 6.3% in August, up from 6.1% in July. Retail investors have felt the pinch, particularly those in semi-liquid funds like Blackstone Private Credit Fund (BCRED), which capped quarterly redemptions at 5% amid a surge of withdrawal requests.
Despite the desire for guaranteed income, many workers remain hesitant to lock their savings into annuities. Chris Ceder, a senior retirement strategist at Goldman Sachs Asset Management, noted that while target date funds with annuity options exist, "one of the challenges is actually getting people to understand the annuity selection. By and large, people do not want to tie up money in an annuity, but they also want all the characteristics that it provides in many cases."
The survey also explored preferences for advice delivery: 61% of respondents said they would prefer human guidance over AI when making decisions about guaranteed income and annuities, while 20% chose AI and 19% said either. This preference for human advice aligns with the growing role of financial advisors in annuity discussions. Total U.S. annuity sales rose 2% year over year to $121.2 billion in the second quarter of 2026, according to LIMRA data.
Lee emphasized the importance of advisors in this environment. "We're seeing increasing demand for annuities across the board," he said. "From a financial advisor perspective, they're ideally placed to be able to talk about them because many individuals are reluctant to annuitize on their own. So having a trusted partner who you can work with to take that step and figure out the right type of annuity relative to what your needs are, becomes really critically important."
As private credit becomes more embedded in retirement products, advisors may need to help clients understand the trade-offs between yield and liquidity. The portfolio construction approach to private markets is gaining traction, and hybrid model portfolios are emerging as a way to blend public and private assets. Meanwhile, guaranteed income products have been shown to reduce retirement anxiety, according to advisor reports. The challenge remains balancing that security with the risks inherent in private credit.
