Factors to Consider when purchasing a Retirement Income Rider
- Attached to an annuity and some life products
- Guarantees a lifetime income based on a payout factor
- Higher than market accumulations
- Sever restrictions on use of accumulations
- No traditional cash value
- Taxable income
- Often extracts surcharge from underlying policy cash values
- Income amount increases with age
- Income amount dependent on accumulation period
- Extreme carrier to carrier variations
- Complex product that is often misrepresented
- Poor choice for individuals with health problems
- Good choice for individuals in good health and family history of longevity
- Some death benefit options available
- Installment and accelerated funding choices
- Funded by a specialized life insurance policy
- Buyer beware product