Which annuity option guarantees the annuitant cannot outlive the benefits?

• A. Fixed annuity with guaranteed withdrawals
• B. Life annuity with period certain
• C. Variable annuity with death benefit
• D. Guaranteed Lifetime Withdrawal Benefit

Answer: (D)

The main idea here is lifetime income guarantees inside annuities. A guaranteed lifetime withdrawal benefit provides a floor for withdrawals for life, independent of how the account performs. With this rider, you can continue to take withdrawals for the rest of your life even if the underlying investment value falls to zero. The insurer guarantees those payments as long as you meet the contract terms, so you won’t run out of income just because markets tank or the account balance is depleted.

Other options don’t offer that same guaranteed lifetime feature. A fixed annuity with guaranteed withdrawals may promise a steady stream or a guaranteed period, but not necessarily lifetime payments that survive market downturns or depletion of the account. A life annuity with a period certain pays for life but includes a specified period for a beneficiary if you die early; it still isn’t a guarantee that your income will continue for life regardless of the account’s actual performance. A variable annuity with a death benefit ties benefits to market results and mainly provides a death benefit to beneficiaries, not a lifetime income guarantee to the owner.