Income Rider(GLWB)
An optional annuity feature that provides lifetime withdrawals without giving up access to the contract value.
An income rider — often a guaranteed lifetime withdrawal benefit (GLWB) — is an optional add-on that lets you take a guaranteed level of withdrawals for life while keeping access to any remaining contract value. It usually carries an annual fee.
The guaranteed income is backed by the claims-paying ability of the issuing insurance company and is not FDIC insured. Riders use a separate 'benefit base' to calculate income, which is generally not a cash value you can withdraw as a lump sum.
Example
A retiree adds an income rider so that at 67 they can withdraw a guaranteed amount each year for life, even if the contract value is later depleted.
This definition is for general educational purposes only and is not financial, tax, or legal advice. Tim Hartle is an independent insurance professional. Annuity guarantees are subject to the claims-paying ability of the issuing insurance company and are not FDIC insured. Rules and product features vary by situation and by state. Please consult a qualified advisor about your own circumstances.
Related Terms
Fixed-Indexed Annuity
An annuity that credits interest tied to a market index, with a floor that protects against index losses.
Annuitization
The process of converting an annuity's value into a stream of income payments, backed by the issuing insurance company and not FDIC insured.
Longevity Risk
The risk of outliving your savings because retirement lasts longer than planned.
Deferred Annuity
An annuity that grows during an accumulation phase before income payments begin later.
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Annuities are insurance contracts. Guarantees, including guaranteed lifetime income benefits where available, are subject to the claims-paying ability of the issuing insurance company. Product features, fees, withdrawal restrictions, and surrender charges vary by contract.