DON'T GAMBLE YOUR RETIREMENT AWAY

 “Lifetime Income Benefit Riders” are known by a variety of terms. Some companies refer to these products as “Guaranteed Income Withdrawal Benefits,” The bottom line: This rider, unlike annuitization allows the annuitant to take a lifetime income from the annuity without losing control of this retirement asset. In short, you can stop and start at any time and the account value can continue to grow. The Lifetime Income Rider assures the annuitant that he/she will never run out of money or live too long. These payouts can provide “single life income” or “joint lifetime income.”

“Chronic Illness, Terminal Illness, Confinement Waivers” are riders that provide important benefits, such as: complete liquidity after a certain period of confinement, and increased payouts in the event the annuitant experiences some degree of incapacity that prohibits him from operating independently. Other riders for inflation and death benefit enhancement are also available. Please make sure to look at each company’s riders as they differ from company to company. 

Bottom line: an index annuity with an income rider and a confinement rider can make retirement more enjoyable with a lot less stress. 

Money remaining inside an annuity grows without being taxed until withdrawn. Unlike qualified retirement accounts where you must begin taking out money around age 70, most annuity contracts permit the owner to enjoy the advantage of tax deferral until age 85, 90, or even later. Tax deferred does not mean tax-free; interest is taxed when withdrawn. Also, the Treasury Department charges a 10% penalty on interest, in addition to regular taxes, if withdrawals are made before age 59.