Lifetime Income Annuity Provides Many Solutions

To help people create a customized retirement income strategy, New York Life Insurance Company offers the Lifetime Income Annuity, a fixed rate immediate annuity that ensures policyowners can't outlive their income. In addition, the Lifetime Income Annuity also enables policyowners to:

• protect themselves against inflation,
• pass money on to their heirs and;
• take lump sum cash withdrawals.

While there are annuities available that address each of these concerns singly, New York Life's Lifetime Income Annuity is one of the few, if not the only one, that provides a solution for all of them in one annuity.

Fixed Annuities

A fixed annuity is a deferred annuity that grows at a fixed rate of interest until its maturity date. At that time, you can elect to take the money as a lump sum or in installments that will continue until the principal is exhausted. You may be advised to withdraw assets based on the assumption that you will live to life expectancy. The fixed annuity provides a stream of income that does not fluctuate. The problem is, if you die sooner than that you may have lived on less than you otherwise could have. If you die later than that, you may have outlived your income stream. And people today are living longer. Even though the Vital Statistics Reports (Vol. 52. No. 14 Feb. 18, 2004) pegs the life expectancy of a U. S. male born in 1955 at just under 70 years, the fact is that men turning 50 over the next year have an increased chance to live to 80 and beyond, making it all the more difficult to accurately predict how long retirement income must last and the presence of a lifetime income all the more important.

Immediate Annuities

By contrast, an immediate annuity pays a guaranteed rate of interest, resulting in a guaranteed stream of income for the rest of your life. Immediate annuities are generally bought with one lump sum payment, which is then "immediately" converted into a series of scheduled payments. For this reason, people may choose to rollover an existing deferred annuity — or perhaps an IRA or funds from a 401(k) — into an immediate annuity.

[Immediate annuities are very popular among middle–income households. According to a 2002 Survey conducted by Mathew Greenwald and Associates for the American Council of Life Insurance, 64 percent of immediate annuity owners report annual income of less than $50,000. While the income generated by an immediate income is often modest — 87 percent of owners receive less that $20,000 on an annual basis— according to the survey, the policyowners believe these products make an important contribution to a financially secure retirement.]

Practically all immediate annuities can provide a lifetime income for you and a continued income for a spouse or partner after you die. Only the New York Life Lifetime Income Annuity however, provides three income options, as well as inflation protection and withdrawal features.

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