Phil is shopping for an annuity that guarantees he CANNOT outlive the benefits. Which of these benefit options would he choose?Accelerated lifetime benefitGuaranteed lifetime withdrawal benefitRight of income riderGuaranteed minimum accumulation benefit

To ensure Phil cannot outlive the benefits:

1. Choose the option that guarantees payments for the rest of his life.
2. The "Guaranteed lifetime withdrawal benefit" ensures that Phil receives payments for as long as he lives, regardless of how long that is.

Supplemental Knowledge

Annuities are financial products designed to provide a steady income stream, typically for retirees. Understanding the different types of annuity benefits is crucial for making an informed decision:

1. Accelerated Lifetime Benefit:
   • This benefit allows the annuitant to receive higher payments for a shorter period, often in cases of terminal illness or long-term care needs. It does not guarantee lifetime income.
2. Guaranteed Lifetime Withdrawal Benefit (GLWB):
   • This option ensures that the annuitant can withdraw a certain amount of money each year for life, regardless of how long they live or how the underlying investments perform. It provides a guaranteed income stream that cannot be outlived.
3. Right of Income Rider:
   • This rider typically offers additional features or flexibility in accessing income from the annuity but does not necessarily guarantee lifetime income.
4. Guaranteed Minimum Accumulation Benefit (GMAB):
   • This benefit ensures that the annuity's value will not fall below a certain minimum amount after a specified period, providing protection against market downturns but not guaranteeing lifetime income.

Everyday Examples

Consider Sarah who's planning her retirement and looking to ensure she has enough funds to cover expenses no matter the length of her life. After researching annuity options with Guaranteed Lifetime Withdrawal Benefit (GLWB), Sarah makes her selection knowing they will continue receiving fixed annual payments throughout her retirement years, providing peace of mind and financial security during this phase.

For those like Phil who are planning their retirement and want to ensure they have reliable income for life, understanding your options is crucial. UpStudy’s live tutor question bank or AI-powered problem-solving services can help you navigate complex financial decisions with ease! 
To dive deeper into retirement planning strategies and make informed choices about your future, explore UpStudy’s comprehensive resources today! Our experts are here to guide you every step of the way towards securing your financial future with confidence.