Split-Funded Annuity


DEFINITION of 'Split-Funded Annuity'

A type of annuity that uses a portion of the principal to fund immediate monthly payments and then saves the remaining portion to fund a deferred annuity. The two funding methods let the annuity holder receive dependable income and simultaneously save for future needs.

BREAKING DOWN 'Split-Funded Annuity'

Using a split-funded annuity means that individuals do not have to wait for the annuity to reach the payout phase, because the stream of income begins immediately.  At the same time, the annuity's remaining balance compounds tax deferred.

  1. Annuity

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  2. Deferred Annuity

    A type of annuity contract that delays payments of income, installments ...
  3. Immediate Payment Annuity

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  4. Annuitant

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  5. Payout Phase

    The phase in an annuity during which payments are made to the ...
  6. Qualified Longevity Annuity Contract

    A Qualified Longevity Annuity Contract (QLAC) is a deferred annuity ...
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  1. Can I borrow from my annuity to put a down payment on a house?

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  2. What are the main kinds of annuities?

    There are two broad categories of annuity: fixed and variable. These categories refer to the manner in which the investment ... Read Full Answer >>
  3. What are the risks of rolling my 401(k) into an annuity?

    Though the appeal of having guaranteed income after retirement is undeniable, there are actually a number of risks to consider ... Read Full Answer >>
  4. How do I get out of my annuity and transfer to a new one?

    If you decide your current annuity is not for you, there is nothing stopping you from transferring your investment to a new ... Read Full Answer >>
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