Retirement Income Peace of Mind
Balanced Allocation Lifetime Income Rider® Stacked Growth Option Max®
Planning for Lifetime Income
Objective: James wants to maximize his future retirement income.
Solution: James allocates a portion of his retirement savings to BCA Elevate 12 with SGO Max. A 12% Income Base Bonus immediately increases the amount used to calculate his lifetime income.4 His Income Base will grow by a 5% compounding roll-up plus 100% of his BCA Elevate Interest Earnings, if any, every two years.
Result: After 12 years, James begins taking Lifetime Income Withdrawals and benefits from a source of retirement income guaranteed for life.
This is a hypothetical example to show how BCA Elevate 12 and SGO Max can work.
Growth and Lifetime Income
When youʻre ready to begin income, the Lifetime Income Withdrawals are determined by multiplying the Income Base by the Annual Withdrawal Percentage. The graph below shows how Jamesʻs Income Base could grow each year until he begins lifetime income.
For more information about how Lifetime Income Withdrawals are calculated, see the Key Terms below. The graph above is for informational purposes only and intended to demonstrate how the Income Base can grow. It is hypothetical and does not demonstrate actual performance of any BCA Elevate or SGO Max contract or index. This does not demonstrate the potential impact of strategy rider charges and withdrawals, which will reduce the Income Base. Please remember that the Income Base is used for calculating Lifetime Income Withdrawals and cannot be withdrawn in a lump sum. The length of each term is two years. For more information about SGO Max, please ask your insurance professional for an illustration.
Grow Your Future Income
As retirement approaches, you may want to ensure your income will last throughout retirement. The Balanced Choice® Annuity Elevate (BCA Elevate™) can help you grow your retirement savings with no downside market risk, and the Balanced Allocation Lifetime Income Rider® (BALIR®) — Stacked Growth Option Max® (SGO® Max), an optional income rider available for a charge, offers a source of retirement income that you canʻt outlive.1 SGO Max provides three powerful ways to grow future lifetime income:
- Up to a 12% Income Base Bonus immediately increases the amount used to determine future income.2
- 5% Annual Roll-up provides guaranteed Income Base growth at a 5% compounding annual rate for up to 18 years.3
- BCA Elevate Growth adds 100% of the BCA Elevate 12 Interest Earnings, if any, to the Income Base every two years.
For more information on the Income Base and Income Base Bonus, please see the Key Terms below. This material is provided by Athene Annuity and Life Company, headquartered in West Des Moines, Iowa, which issues the product described herein.
Key Terms and Definitions
What is a Fixed Indexed Annuity? – A fixed indexed annuity is a contract issued by an insurance company. In exchange for your premium, the insurance company provides the opportunity for growth based in part on the performance of an underlying index within a larger strategy while protecting your money from downside market risk. All guarantees are backed by the claims-paying ability of the issuing carrier and may be subject to annual fees. Fixed indexed annuities are not stock market investments and do not directly participate in any stock or equity investments or index. It is not possible to invest directly in an index. Other restrictions and limitations may apply. For more information, please see the BCA Elevate product brochure.
Explanation of Lifetime Income Rider and Rider Charge – The Balanced Allocation Lifetime Income Rider — Stacked Growth Option Max (SGO Max) is an optional rider that must be elected at contract issue and is available for an annual rider charge. The annual rider charge of 1.00% of the Income Base is calculated at the beginning of every contract year. The charge is deducted in monthly installments from the Accumulation Value as well as from the Minimum Guaranteed Contract Value in some states. On the 10th contract anniversary, you may elect to extend Income Base growth up to the 18th contract anniversary. The rider charge may increase starting at the beginning of the 11th contact year.
Income Base – The Income Base is used to determine the annual Lifetime Income Withdrawals and annual Rider Charge, if applicable. SGO Max offers Income Base growth at a daily rate that is equivalent to 5% annual compound interest plus 100% of any BCA Elevate Interest Earnings every two years, minus the Strategy Rider charge, if applicable. Income Base growth is credited to the Income Base through the earlier of beginning Lifetime Income Withdrawals or the 10th contract anniversary (or up to the 18th anniversary if the roll-up is extended as discussed above). If you begin Lifetime Income Withdrawals before the end of a two-year term, Interest Earnings, if any, will be credited pro rata to the Income Base. The Income Base is not an amount that has a cash value or surrender value that can be paid out partially or in a lump sum. Withdrawals, prior to commencing Lifetime Income Withdrawals, will reduce the Income Base by the same percentage that the Accumulation Value is reduced for the withdrawal. However, the dollar amount of this reduction will not be less than the deduction from the Accumulation Value. After Lifetime Income Withdrawals have commenced, withdrawals up to the Lifetime Income Withdrawal amount will reduce the Income Base by the dollar amount of the withdrawal, while withdrawals in excess of the Lifetime Income Withdrawal amount will reduce the Income Base and future Lifetime Income Withdrawals by the same percentage that the Accumulation Value is reduced for the withdrawal. Withdrawals may also be subject to Withdrawal Charges, Premium Bonus Vesting Adjustments or Market Value Adjustments (MVAs), if applicable. For more information, please see the Certificate of Disclosure.
Lifetime Income Withdrawals – Lifetime Income Withdrawals are calculated by multiplying the greater of the Income Base or Accumulation Value by the current Annual Withdrawal Percentage when Lifetime Income Withdrawals begin. The Annual Withdrawal Percentage depends on the income option elected and is determined by the “Age” Lifetime Income Withdrawals begin. “Age” means your attained age for Single Life or the younger of your attained age or your spouse’s attained age for Joint Life when your spouse is listed as the sole beneficiary or the contract is jointly owned. In general, the longer you wait to take income, the greater the initial Annual Withdrawal Percentage will be. When you’re ready to begin Lifetime Income Withdrawals, SGO Max offers the following options:
- Level Income Option offers the highest initial amount.
- Inflation-Indexed Income Option increases the lifetime income annually based on increases in the Consumer Price Index, if any. Increases are capped at 10% per year and stop when the Maximum Inflation Adjustment Period has elapsed, which varies by state.
- Earnings-Indexed Income Option may increase the lifetime income at the end of every 2-year strategy term based on the rate of interest credited, if any, in the BCA Elevate strategy until the Accumulation Value is reduced to zero, after which time lifetime income will increase by 1% annually.
The Inflation-Indexed Income Option and Earnings-Indexed Income Option offer less initial income than the Level Income Option but may provide more income over your lifetime due to potential increases after beginning Lifetime Income Withdrawals. Lifetime Income Withdrawals will continue even if they ultimately reduce the Accumulation Value to zero. Withdrawals in excess of the Lifetime Income Withdrawal may be subject to a Withdrawal Charge, MVA and Premium Bonus Vesting Adjustment and will reduce future Lifetime Income Withdrawals. Withdrawals in some instances could terminate the rider. For more information, please see the Certificate of Disclosure and ask your insurance professional. Withdrawals and surrender may be subject to federal and state income tax and, except under certain circumstances, will be subject to an IRS penalty if taken prior to age 59½.