An income rider (also called a guaranteed lifetime withdrawal benefit or GLWB) is an optional feature on an annuity that guarantees a minimum level of lifetime income regardless of account performance. The income base grows at a guaranteed rate (typically 5-7% per year) until you start taking income.
Key Points
- Income rider: guarantees minimum lifetime income regardless of account performance
- Income base grows at guaranteed rate (typically 5-7%/year) until income starts
- Once income starts: guaranteed payment for life
- Income payments continue even if account value goes to $0
- Adds cost to the annuity (typically 0.5-1.5%/year)