Deferred income annuities.
Advances in medical technology create need for long-term financial health.
It’s true…thanks to medical advances, people are living longer and spending more of their later years in retirement. But as the length of retirement grows, so, too, must a persons savings to make those last few years pleasant and affordable. How does someone—especially a person young enough to take advantage of new, life-prolonging medical advances—make sure they don’t outlive their retirement savings? One way is through a deferred-income annuity (DIA) that would guarantee income for life.
It starts with an initial premium.
Typically, when a client purchases an annuity contract, they enter into an agreement in which they pay a premium in exchange for a future stream of income—often used to supplement Social Security and other retirement savings. Upon signing, the client pays an initial premium (or, for some policies, a one-time premium) to fund the account. If it is not a single-premium contract, they then agree to pay premiums over time based on the amount they can expect to receive in retirement and the length of the funding period. The problem: Younger investors—those who may need long-term guaranteed income the most—are often priced out.
Insurance companies are listening.
Several of the life insurance companies that offer annuities—including New York Life—are starting to address this concern. For example, the initial minimum premium payment on our Guaranteed Future Income Annuity (GFIA) was recently cut in half to $5,000, with subsequent premiums as low as $100, making it more attractive to those who are facing significant living costs that come with paying off student loans, owning a home, or starting a family. In addition, GFIA offers New York Life clients the option to pay premiums monthly, quarterly, semi-annually, or annually to help build value over time, when they might not be able to do so otherwise.
What if you need to cancel?
Surrender charges do apply on many products for up to 10 years, but generally decrease every year during the surrender-charge period. Each annuity contract offered is different, so make sure to read the terms carefully and work with a financial professional who understands the ins and outs of these products.
When do I start receiving payments?
After a chosen waiting period that is written into the contract, you can start taking payments. This is called annuitization. Typically, the longer you wait the more monthly income you will collect. And this stream of income is guaranteed for life, so you don't have to worry about running out of money. Is a flexible payment option DIA right for you?
If you don’t want to outlive your retirement income stream, it just may be. And if you are younger, cost conscious, and need flexibility, this is something you may want to consider. Even if you're not, New York Life offers both annuity and life insurance products that can fit almost any budget and situation.
As always, your New York Life agent would be happy to review your options with you. Don’t have a New York Life agent, yet? Fill out the “Contact an Agent” form on this page and we will have an agent in your area contact you.
The New York Life Guaranteed Future Income Annuity is issued by New York Life Insurance and Annuity Corporation (NYLIAC) (a Delaware Corporation) a wholly owned subsidiary of New York Life Insurance Company. Available in jurisdictions where approved.
Guarantees are subject to contract terms, exclusions and limitations, and the claims paying ability of New York Life Insurance and Annuity Corporation (NYLIAC) (a Delaware Corporation), a wholly owned subsidiary of New York Life Insurance Company. This contract has no cash surrender value and no withdrawals are permitted prior to the income start date. Income payments are guaranteed at least as long as the annuitant is living, provided the annuitant is alive on the designated income start date. Contracts in which a Life Only payout option is selected do not provide for payments to beneficiaries either prior to or after the designated income start date.
For most jurisdictions, the policy form number for the New York Life Guaranteed Future Income Annuity is ICC11-P100 and state variations may apply.