How to enter annuity living benefit values
Learn how to incorporate annuity living benefits into your financial plan and understand how lifetime withdrawal guarantee riders work.
Last published on: October 31, 2025
Video: Annuity Tutorial Video
Video Transcript
welcome this video will walk you through
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how to add annuities into your income
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lab
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household when you're in your household
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from your main dashboard page or on any
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of the plan feature Pages find the
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pencil icon in the top right of your
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screen and then click edit to go to your
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plan
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edits then from the asset
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section find the annuities tab
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below here on the annuities tab is where
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you can fill out the information below
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to set up your annuity so first we can
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call it an account name just for this
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example I'll call this a fixed index
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annuity then you can select the annuity
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type you can either add a variable or a
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fixed index annuity in this case for
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this example I will use the fixed index
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example then we can select the annuity
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type so we'll just say this is a
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qualified annuity and then we can select
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the ownership and add the
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balance once you add the required
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information you'll notice that the gear
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icon will then pop up click the gear
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icon and then from there you want to
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then click the annuity settings button
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to then add the settings of your annuity
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first on this income tab we can add in
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the benefit base the guaranteed
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withdrawal rate we can select the
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covered lives whether that's both people
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or in each individual and then we can
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use the calendar icon here to select
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when the income uh will start from the
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annuity if the annuity does not come
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with lifetime withdrawals you can
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uncheck this box and put put an end date
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for the annuity there as
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well you'll also notice the advanced
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settings below will automatically
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withdraw rmds for the annuity if it's
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greater than the guaranteed withdrawal
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amount if you do not want this to happen
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automatically you can say no and then
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the software will only withdraw the
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amount from the annual benefit and not
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any additional to cover
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rmds next you can go to the benefit
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increases section here you can select
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the anniversary month you'll have the
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option of whether to choose if the
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benefits increase during the deferral
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stage via a rollup or VI a withdrawal
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rate increase once you select the toggle
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you can then enter for example here your
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roll up
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rate below you can then select how the
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benefit will increase during the
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withdrawal phas you can either use the
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balance high water mark option or select
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the asset allocation returns
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option then you can open up the advanced
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settings to enter more details about
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your annuity here we can select if the
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basic annuity projection will use
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average returns or if it'll be based off
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guaranteed growth and specific rates if
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you select the average returns option
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you can then select when the end of the
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guaranteed growth during the deferral
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period will be and then you can also
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select if the guaranteed growth base
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will grow simple or compounded and if it
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will be stackable or non-stackable
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if you choose the guaranteed growth rate
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and specific rates option you will then
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also be able to select the displayed
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annual income growth during the
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withdrawal phase so for example if this
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annuity again will grow by 3% in the
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withdrawal phrase We want to select that
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3% here in this
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field from there since this is a fixed
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index annuity we can also enter the
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information on the crediting methods
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you'll you will be able to open up the
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credit method field here to select
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whether it's based off a cap
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a participation rate or a fixed
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rate if the crediting method will change
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at some point in the plan you can
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uncheck this box that says use same
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crediting method values throughout plan
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and then select the end of the term and
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what the new crediting method value will
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be after the
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term if the annuity is using multiple
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crediting methods you can uncheck the
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second box here and then put in the
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splits Bas based off the crediting
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methods it's using
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and then the last option here is to
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enter any fees for the annuity so
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whether the annuity comes with an
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expense fee or an advisor fee or there's
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a living benefit fee you can add both of
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those here once you've added all your
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settings here click save and then on the
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right side again we want to click save
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to save our inputs and then we can click
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finish to then add the annuity into the
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plan and go back to our plan results
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once you've added the annuity into your
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plan there's a few areas where you we
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can specifically call out that annuity
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first if you click the spending capacity
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field you'll now see your annuity income
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will show up as protected income on this
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section helping you highlight how much
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of that income is being protected
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because it's coming from the annuity
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you'll also see that you can find the
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annuity here based off of the a text
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here next to the Sands icon and that
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will also point out the annuity that
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you've added you can also go into our
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stress test and in plans where you have
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an annuity you'll see the a option here
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on the right where you can stress test
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this specific annuity through the
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different historical periods that you
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have available in the stress test so
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example here we can see our fixed index
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annuity in the global financial crisis
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period and we can show our clients
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exactly how the income is experienced so
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here showing that the income does not go
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down and stays flat and is guaranteed
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through the life of the plan but then
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below we can also point out how the
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benefit base and balance also moves
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through this period so showing the
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benefit of the FIA where while the
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balance is going going down here we can
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see that our benefit based B level
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showing why we're getting that lifetime
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income from the
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annuity thank you for viewing this video
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we hope this helps please reach out to
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our team if you have any questions
Annuity Settings
Annuities with lifetime withdrawal benefits can be included in an Income Lab plan. Simply add the account in the Assets > Annuities tab.
The particulars of the annuity are set by clicking on the gear icon to the right and clicking on Annuity Settings.
The Annuity Settings link gives you access to settings organized in the following tabs.
- Income: Information about the life/lives covered by the annuity and when withdrawals from this annuity begin or end.
- Benefit Increases: Information about when and how the withdrawal benefit can increase during deferral and during withdrawals.
- Crediting Methods (Fixed Index Annuities only): What crediting method(s) and parameters affect the returns on this fixed-index annuity?
- Fees: Enter fees particular to this annuity.
Income
The following settings are available on this tab.
- Guaranteed Withdrawal Base (GWB): The 'benefit base', or amount on which the guaranteed withdrawal amount is based. For example, the GWB could be $200,000 while the annuity balance is $150,000. If the guaranteed withdrawal rate is 5%, the annual guaranteed withdrawal would be $10,000.
- Guaranteed Withdrawal Rate: The amount of the guaranteed withdrawal base that is guaranteed to be available for withdrawal each year. For example, if the withdrawal rate is 5% and the base is $100,000, the guaranteed withdrawals will be $5,000/year.
- Covered Life: One or both spouses in a plan can be covered, even if the account is a singly owned IRA or other account.
- Timing of withdrawals: Enter when you plan to begin withdrawals and whether the withdrawals will be fore the lifetime(s) of the covered life/lives.
- RMDs: If the RMDs for this annuity (if it has RMDs) are greater than the guaranteed amount, should the plan model taking the higher amount? If 'yes', the guarantee after this withdrawal will not be reduced.
Benefit Increases
This tab covers information on how the annuity withdrawal benefit can increase in the deferral and withdrawal phases.
- Anniversary Month and Step-Up Frequency: When and how often does the annuity give an opportunity for an increase in guaranteed withdrawals? (There are no step-up inputs for FIAs. All FIAs are treated as having annual step-ups.)
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Benefit Increase during Deferral:
- Rollup: On each anniversary during deferral, apply the "rollup" rate to the guaranteed withdrawal base (GWB) / benefit base
- Withdrawal Rate Increase: On each anniversary during deferral, add to the guaranteed withdrawal rate. For example, if the guarantee withdrawal rate is 5% now and the 'Annual Addition to Withdrawal Rate during Deferral' is 0.50%, on the next anniversary the withdrawal rate will go to 5.5%.
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Benefit Increase during Withdrawal Phase:
- Balance High-Water Mark: On each step-up opportunity (anniversary, quarter, etc.) if the balance is higher than the guaranteed withdrawal base (GWB) / benefit base, increase the withdrawal base to this new high-water mark.
- Asset Allocation Returns: On each anniversary, increase the guaranteed withdrawal amount by the returns of the annuity's allocation (with a floor of 0%). Apply this increase even if the annuity has a balance that is below the current benefit base, even if the balance is $0. (This option is typically only seen for fixed index annuities.)
The Benefit Increases tab also offers some advanced settings. The advanced settings available will depend on other settings for the annuity. For example, the 'Guaranteed Growth of GWB is...' settings are only seen if the annuity's 'Benefit Increase during Deferral' is set to 'Rollup'.
- Displayed annual income growth during withdrawal phase: For determining spending capacity and guardrails, actual income growth/step-ups will be used. However, in some places in the application, such as Life Hub and the Income Sourcing graph and table, you may want to assume that the income for this annuity will go up during the withdrawal phase, and display this increase in the application. If you enter a value greater than 0% here, you will see the withdrawals from the annuity going up by this amount in Life Hub, the Income Sourcing Graph, and in Tax Lab.
- End of guaranteed growth during deferral: Many annuities provide a limited period of guaranteed benefit increases during deferral. Enter the end of this phase here. These guaranteed increases will end at the earlier of this date or the beginning of withdrawals.
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Guaranteed Growth of GWB is:
- Simple | Compounded: If the annuity's guaranteed growth is in the form of a rollup, is this growth rate compounded on previous years' guaranteed growth ('compounded') or not ('simple')?
- Stackable | Non-Stackable: If the annuity's guaranteed growth is in the form of a rollup, is this growth rate based off of the annuity's balance high-water mark ('stackable') or not ('not stackable')?
- Amount on which rollup is based: If the annuity's guaranteed growth is in the form of a rollup and this rollup is either not stackable or simple, enter the amount on which the guaranteed growth will be figured. Note that if the rollup is compounded and stackable, you will not enter this value.
Crediting Methods
The credited returns for fixed index annuities depend on what index or mix of indexes is being tracked, as well as the crediting method or mix of crediting methods being used and the values associated with those crediting methods. For more on these topics, please go to this article that covers these settings.
Fees
Many annuities have fees associated with them. The 'Fees' tab allows you to enter these.
- Base Annuity Fee (M&E): Fee applied to the overall annuity balance. Include any applied advisory fee here.
- Living Benefit Fee: Annualized fee that applies to the living benefit withdrawal base. For example, if the fee is 1%, the withdrawal base is $100,000, and the annuity balance is $80,000, the fee for that year would be $1000.
Note that, for variable annuities, the plan's asset class-level fees will be applied. These are the same asset class fees that are applied to the plan's investment accounts. For example, if you have a 0.20% fee set for Large Cap Growth, this same fee will be applied if a variable annuity has an allocation to Large Cap Growth. You can find these fees in the plan's Advanced Settings. No asset-class-level fees will be applied to fixed index annuities. If you would like to apply a higher fee for the annuity, you can do so by increasing the Base Annuity Fee.