Two-Tiered Annuities

With many two-tiered annuities, dollars accumulate based on 2 interest rates, for example, 4% or 7%. However, in order to receive the benefit of the higher accumulation, one must have the annuity in force for 5 years, for example, plus they must annuitize of a 10 year period of time.

Some critics have said that too many consumers have forgotten the conditions necessary in order to get the higher rate such as annuitizing during the life of the annuitant with no monies paid to beneficiary (Life Only), or during the lifetimes of both spouses and to the survivor.

While other critics point out that “the concern for outliving money” is possibly the consumers #1 concern and that “annuitizing” provides lifetime guaranteed income.