It can be tough to plan for the unknown. Among the different types of riders that can be added to annuities or life insurance is an income rider. Income riders provide guaranteed lifetime income, limiting the risk of outliving your assets and helping your money keep up with inflation.
A lifetime income rider can be written to include options such as:
An annual step-up feature that increases the withdrawal percentage if your annuity investment value increases. This means you’ll get a higher income payment.
A guaranteed minimum growth rate established when you open an annuity with a lifetime income rider. The withdrawal percentage is related to this rate.
A joint option for continuing the lifetime income for your spouse.
An option for a non-lifetime withdrawal (Restrictions and limitations do apply.).
An income rider can be particularly beneficial if you are concerned about outliving your money and/or retiring early. With a rider in place, your plan could continue to pay you even after the annuity value is depleted.