The standalone living benefit (“SALB”) is a relatively new and innovative product in the retirement income arena.

A SALB is basically the same thing as the guaranteed lifetime withdrawal benefit (GLWB) that accompanies many variable annuities.  The GLWB feature allows the contract holder to withdraw a fixed percentage of the total annuity premiums each year regardless of market performance.

A very good, balanced article about the longevity annuity--well worth the read.

Consider that the annuity payout for a $50,000 longevity annuity purchased from MetLife by a 60 year old male is $56,106 per year.  The payouts begin at age 85 and last for the lifetime of the contract holder.

Tax considerations, estate planning and financial planning are discussed in the context of longevity annuities.

Source: U.S. News and World Report

There are many, many different types of annuities. 

To begin with, it makes sense to think about the general definition of an annuity.  An annuity is a contract that converts a sum of money into a series of periodic payments for an agreed upon period of time. An annuity can be thought of as a financial vehicle that converts a pool of money into a stream of income.

Annuities can be very effective in providing protection against market volatility.

There is a very good article on that site that discusses how owners of certain types of variable annuities have been insulated from many of the effects of the financial crisis.  That article can be found by clicking here.

There has been a ton of recent discussion in the press about the financial health of life and annuity insurance companies.  In particular, there has been discussion surrounding the health of insurance companies that have provided living benefit guarantees that accompany variable annuities.

It is perfectly reasonable to be concerned about the ability of insurers to make good on their financial commitments.  With annuities, many of the contracts are long-term and involve large amounts of money that represent a significant portion of the policuholder's net worth.

Annuities are products that combine insurance and, in the case of variable annuities, asset management.  Costs are absolutely critical, so definitely ask you financial advisor to spell-out the costs for each of the items discussed below.

It depends upon whether it is a fixed annuity or a variable annuity.  Costs are a critical situation, so definitely ask you financial advisor to spell-out the costs for each of the items discussed below.