Annuity Phases

Accumulation phase:

In the accumulation phase, money is added to annuities and allowed to grow income tax deferred.  Remember that some annuities may allow more premium(s) to be added to a contract during this phase.

Annuitization phase:

During an annuitization phase the contract is unable to be altered.  Annuitization has also been coined as annuicide.  There are a few different ways to annuitize a contract.  From a high-level you may annuitize:

* Ffor the remainder of person or persons lives,

* For set period of time

* Or a combination of the two.

Income phase:

Different products have different ways to address this.  You might have a classic annuity that only allows for annuitization. On the other hand, you might have an annuity with a rider allowing for greater income options without committing annuicide.


I addressed these paragraphs in a previous article.