1. What is Lifetime Income Benefit?

Lifetime Income Benefit refers to a guaranteed income stream that continues for the remainder of an individual's life, typically associated with annuities or retirement plans. It provides financial security by ensuring a steady income regardless of market conditions or longevity.

2. How Does the Calculator Work?

The calculator uses the simple formula:

Where:

• \( Benefit Base \) — The total amount of funds available for generating income
• \( Withdrawal \% \) — The percentage of the benefit base withdrawn annually
• \( Income \) — The resulting annual income amount

Explanation: This calculation estimates the guaranteed lifetime income based on your benefit base and the predetermined withdrawal percentage specified in your contract.

3. Importance of Lifetime Income Calculation

Details: Calculating lifetime income benefits helps individuals plan for retirement, understand their guaranteed income streams, and make informed decisions about financial planning and retirement security.

4. Using the Calculator

Tips: Enter your benefit base amount in dollars and the withdrawal percentage as specified in your contract. Both values must be positive numbers to calculate your estimated lifetime income.

5. Frequently Asked Questions (FAQ)

Q1: What is a benefit base?
A: The benefit base is the amount used to calculate your lifetime income payments, which may be different from your actual account value depending on your contract terms.

Q2: How is the withdrawal percentage determined?
A: The withdrawal percentage is typically determined by your age at the time you begin taking income and is specified in your contract. It often increases as you get older.

Q3: Is lifetime income guaranteed?
A: Yes, lifetime income benefits are typically guaranteed for life, meaning you'll continue to receive payments regardless of how long you live or market performance.

Q4: Can the benefit base change over time?
A: Depending on your contract, the benefit base may have features that allow it to increase through step-ups, bonuses, or other mechanisms outlined in your agreement.

Q5: Are there fees associated with lifetime income benefits?
A: Yes, most annuity products and retirement plans with lifetime income features charge fees for these guarantees. Review your contract for specific fee information.