The Power of Designated Periods
Designated-period annuities are a powerful tool for building a precision retirement income plan that minimizes taxes and maximizes returns.
Using designated periods creates a known value for the income streams, enabling precise return calculations. In general, these returns are much higher than a lifetime annuitization alternative.
Unlike lifetime annuities, the designated payments provide a death benefit that is guaranteed.* This allows the annuitant to retain the full value of the annuity payments and the accumulated benefit of the earnings, whether for themselves or for their heirs.
Designated periods take full advantage of opportunities to utilize the special tax treatment that annuities provide. Tax-excludable income is maximized for non-qualified assets (those assets not contributed pre-tax), making it possible to keep overall taxes lower. Thrive® calls this first in, blend out (FIBO®). This is particularly helpful when considering timing of Social Security payments and required distributions from qualified assets.
Designated periods permit coordination with other income sources, including Social Security, pensions, and part-time work. They provide the flexibility to handle stops and starts from these other sources.
*Guarantees subject to claims-paying ability of the issuing company