Life With Guaranteed Term

DEFINITION of 'Life With Guaranteed Term'

An annuitization-method option with which the annuitant chooses to receive regular income payments that are guaranteed to last the rest of his or her life but also guarantees income payments for a minimum number of years (the term) following the start of the annuitization period - even if the annuitant dies before the end of the term.

BREAKING DOWN 'Life With Guaranteed Term'

This annuitization-method option guarantees you a lifelong retirement income but also removes the risk associated with an early death, in which case you would lose the value of your contributions to the annuity account. However, compared to the annuitants who have the standard life option (without guaranteed term coverage), annuitants who choose this option generally receive smaller income payments as a price paid for the added safety.

RELATED TERMS
  1. Life Option

    An annuitization-method option for a typical annuity offered ...
  2. Period Certain

    An annuitization-method option with which the annuitant selects ...
  3. Guaranteed Minimum Income Benefit ...

    A type of option that annuitants can purchase for their retirement ...
  4. Annuitization Method

    A type of annuity distribution structure that gives the annuitant ...
  5. Certain And Continuous

    A type of annuity that guarantees a number of payments, even ...
  6. Joint Life With Last Survivor Annuity

    An insurance product that, when annuitized, makes payments to ...
Related Articles
  1. Retirement

    Introduction To Annuities: Basics of Annuities

    In the introduction, we learned about the history and purpose of annuities. In this section, we will explore the mechanics of these contracts and the basic characteristics that apply to all forms ...
  2. Bonds & Fixed Income

    Explaining Types Of Fixed Annuities

    Learn about this popular retirement tool, its pros and cons and how annuities work to create a guaranteed regular stream of retirement income.
  3. Professionals

    Types of Annuity Payouts

    FINRA/NASAA Series 26 Section 3 - Types of Annuity Payouts. This section describes several annuity payout options: life annuity, life annuity with period certain, joint life with last survivor ...
  4. Retirement

    Is Annuitization Your Best Strategy?

    Annuitization has traditionally offered annuity owners a stream of income they cannot outlive, but there are some disadvantages to this form of payout. Consider alternatives, such as income-benefit ...
  5. Professionals

    Types of Annuity Payouts

    FINRA Series 6: Section 11 Types of Annuity Payouts. In this section Payout Phase, Life Annuity, Life Annuity with Period Certain, Joint Life with last survivor, life contingency.
  6. Products and Investments

    An Annuity Lowdown for Investors and Advisors

    Knowing how annuities work starts with an explanation of what each part is. Here is a list of terms that cover the basic aspects of annuities.
  7. Annuities

    What annuities are: Insurance products that provide a source of monthly, quarterly, annual or lump sum income during retirement. Pros: Tax-deferred growth of earnings; no annual contribution ...
  8. Professionals

    Annuities

    Annuities
  9. Retirement

    Analyzing The Best Retirement Plans And Investment Options: Annuities

    What they are: Insurance products that provide a source of monthly, quarterly, annual or lump sum income during retirement. Pros: Tax-deferred growth of earnings; no annual contribution limit; ...
  10. Bonds & Fixed Income

    How to Use Annuities for Retirement Income

    We explain how to use annuities for guaranteed income in retirement.
RELATED FAQS
  1. What happens to my annuity after I die?

    Understand the different types of annuity payment plans and what payments or additional benefits are payable to your beneficiaries ... Read Answer >>
  2. How are variable annuities taxed at death?

    Find out how variable annuities are taxed after the death of an annuitant, including an explanation of the various payment ... Read Answer >>
  3. In the separate account of a variable annuity, which of the following characteristics ...

    The correct answer is b. When the holder of a variable annuity contract annuitizes the contract, he/she is asking that the ... Read Answer >>
  4. What is the difference between a fixed and variable annuity?

    Understand the difference between fixed, variable and indexed annuities, and read a brief summary of their respective risks ... Read Answer >>
  5. What are the main kinds of annuities?

    Learn about the four basic types of annuities, and why the different investment and payout options are suitable for different ... Read Answer >>
  6. How does a company obtain a bank guarantee?

    Find out how bank guarantees work, why they are issued and the process that a business normally goes through to acquire one ... Read Answer >>
Hot Definitions
  1. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  2. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  3. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  4. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  5. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
  6. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
Trading Center