Step 1: Sarah’s benefit base grows
Sarah’s benefit base immediately receives a 6% bonus, and rollup credits are applied to the benefit base during the 10-year rollup period. At the end of this period, Sarah’s benefit base has grown to $169,600 because she did not take any withdrawals or income payments.
Benefit base Account value
END OF CONTRACT YEAR
Example assumes no withdrawals are taken, a 6% rollup bonus and a 6% simple interest rollup credit. Account value assumes a 5% annual growth rate and a 1.15% annual rider charge. If the benefit base received the minimum rider bonus of 2% and grew at the minimum rollup percentage of 2%, the benefit base would have grown to $122,400.
Step 2: Sarah decides to take income payments
At age 67 (at the end of contract year 10), Sarah chooses to start taking income payments on an annual basis. Step 3: Sarah’s income percentage is determined Her income percentage is set at 5.2% based on her age (67) and selected income option (single lifetime income). Step 4: Sarah receives income for life Based on her benefit base ($169,600) and income percentage (5.2%), Sarah will receive $8,819 (169,600 x 5.2%) each year for the rest of her life even if her account value is depleted.
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