Joint-Life Payout

AAA

DEFINITION of 'Joint-Life Payout'

One of two options normally available for retirees to choose as the method of payout for their employee retirement benefits. The joint-life payout option allows the retiree to receive benefits during the remainder of his/her life and guarantees income for another person after he/she has died, most often this other person is the retiree's spouse. Unless the retiree's statements explicitly states the joint-life payout, the default payout option is the single-life option.

INVESTOPEDIA EXPLAINS 'Joint-Life Payout'

In contrast, a single-life option will pay out benefits to a retiree starting at retirement, but the payouts cease upon the retiree's death. Choosing a payout option is an important decision and several factors should be taken into consideration, such as health, anticipated life expectancy and family's financial circumstances.

RELATED TERMS
  1. IRA Plan

    A plan that individuals may establish to arrange and plan for ...
  2. Employer-Sponsored Plan

    A type of benefit plan that an employer offers for the benefit ...
  3. 401(k) Plan

    A qualified plan established by employers to which eligible employees ...
  4. Simplified Employee Pension - SEP ...

    A retirement plan that an employer or self-employed individuals ...
  5. Reinsurer

    A company that provides financial protection to insurance companies. ...
  6. Death Master File (DMF)

    Also known as Social Security Death Index. A list of people whose ...
Related Articles
  1. Borrowing From Your Retirement Plan
    Retirement

    Borrowing From Your Retirement Plan

  2. Tax Tips For The Individual Investor
    Retirement

    Tax Tips For The Individual Investor

  3. Business Owners: Avoid Enron-esque Retirement ...
    Options & Futures

    Business Owners: Avoid Enron-esque Retirement ...

  4. Common Questions About Retirement Plans ...
    Taxes

    Common Questions About Retirement Plans ...

comments powered by Disqus
Hot Definitions
  1. 80-10-10 Mortgage

    A mortgage transaction in which a first and second mortgage are simultaneously originated. The first position lien has an ...
  2. Passive ETF

    One of two types of exchange-traded funds (ETFs) available for investors. Passive ETFs are index funds that track a specific ...
  3. Walras' Law

    An economics law that suggests that the existence of excess supply in one market must be matched by excess demand in another ...
  4. Market Segmentation

    A marketing term referring to the aggregating of prospective buyers into groups (segments) that have common needs and will ...
  5. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  6. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
Trading Center