Annuities may be used for more than just lifelong income. Some annuities come with additional features for a cost, known as riders. Here are some of the most frequent ones:

1. Long-Term Care Riders:

Long-term care costs (either in-home or nursing home care) can be alleviated by these features, which add income to help pay for the extra expenses if such a care event occurs. You may double your monthly annuity payout, gain unrestricted access to the value of your funds, or have both.

2. Cost of Living Riders:

These are common with immediate annuities. They help you to hedge against inflation by raising the monthly income by a particular percentage each year.

3. Refund Riders:

An immediate annuity allows your heirs to receive a one-time cash refund of the contributions you made to the annuity, less the amount of annuity payments you received. A lump-sum cash refund or an annuity refund that extends over time and pays installments may be provided.

4. Impaired Risk Riders:

You can purchase these riders to increase your monthly annuity payments if you have a condition that lowers your life expectancy.

5. Commuted Payout Riders:

These riders are often associated with immediate annuities. They allow for you to take a lump sum from the annuity if a need should arise. It’s usually a time-specific rider that is capped by a percentage of your total annuity amount.

6. Disability, Unemployment, and Terminal Illness Riders:

If you become disabled, lose your job, or discover that you are terminally ill, these riders will kick in. They allow you to access more of your annuity than you normally would without facing surrender penalties.

There may be other riders associated specifically with variable annuities. It’s important to work with an advisor who understands your goals and objectives and helps you to understand your options with riders as they can impact the features and added benefits you may receive

Source:

Annuity.org

Securities offered through SCF Securities, Inc. Member FINRA/SIPC 155 E. Shaw Ave. Suite 102, Fresno, CA 93710 | (800) 955-2517 | Fax (559) 456- 6109. SCF Securities, Inc. and Creative Financial Strategies LLC are independently owned and operated. www.scfsecurities.com Note: Securities offered through SCF Securities Inc., Investment Advisory Services offered through SCF Investment Advisors, Inc.This document is for educational purposes only and should not be construed as legal or tax advice. One should consult a legal or tax professional regarding their own personal situation. Any comments regarding safe and secure investments and guaranteed income streams refer only to fixed insurance products offered by an insurance company. They do not refer in any way to securities or investment advisory products. Insurance policy applications are vetted through an underwriting process set forth by the issuing insurance company. Some applications may not be accepted based upon adverse underwriting results. Death benefit payouts are based upon the claims paying ability of the issuing insurance company. The firm providing this document is not affiliated with the Social Security Administration or any other government entity.