The American Equity Bonus Gold annuity can provide you and those you care about with additional benefits, through the choices that you have for income payouts, and other fund-accessing alternatives. One of these is the Enhanced Death Benefit rider.
According to American Equity’s literature, this lifetime income option offers an Income Account Value rate of 4.5%.
So how exactly is the Enhanced Death Benefit amount and payout determined?
Well, this benefit is based on your Income Account Value (IAV), and it would be equal to the lesser of the following:
- Your IAV on the date of your death; or
- Your IAV on the earliest date that any owner or annuitant on the contract reaches the maximum age – which is presently 85; or
- Your IAV on the first contract anniversary multiplied by the death benefit cap percentage – which is currently 200%
Provided that the necessary factors are all met, your named beneficiary will have a few different options in terms of how they receive the death benefit proceeds. For instance, the funds can be paid out in either:
- A lump sum (which is calculated using a very specific – and drawn out – formula, which can be reviewed here), or
- Through a series of equal periodic payments (which are also subject to some figuring, the likes of which can be reviewed here).
And, in addition to the lifetime income benefit, you will also receive the enhanced death benefit if you choose this benefit on the annuity. Kinda like when two great flavors like chocolate and peanut butter are all mixed into one.
Looking a Bit Closer at the Fine Print on the Enhanced Death Benefit Rider
Unfortunately, in order to take advantage of this tasty piece of the American Equity Bonus Gold annuity pie, there are a few hurdles that must first be jumped through. For starters, there is a rider fee for the Enhanced Death Benefit of .70% of the contract value. And, this fee will be deducted each and every year, provided that the Lifetime Income Benefit Rider (LIBR) remains active.
Also, even though you have the option of resetting your income account value period, if you should choose to do so, American Equity may at that time also change the rider fee. So, who knows whether the fee will be less or more at that time.
Don’t you just hate being in the dark?
So, can the Enhanced Death Benefit rider on the American Equity Bonus Gold annuity be beneficial?
Of course, it can, provided that it fits in with the goals that you are seeking on the annuity.
But it’s also important to keep in mind that, while the optional features that are offered on the Bonus Gold – or on many of today’s annuities, for that matter – could be helpful, there is no “across the board” financial vehicle that will fit perfectly into everyone’s plan.
That’s why it helps to get a more personalized opinion of what may – or may not – work for YOU.
Want an Opinion from an Unbiased Third Party?
Even though the sales brochures for the American Equity Bonus Gold annuity – as well as with most other insurance and financial products – would like to have you think that all will be right with the world if you choose the option they’re offering, the reality is that these brochures are just exactly that…sales materials.
Because of that, the nice rosy advantages of the product are typically featured front and center, while the other features that are considered by most to be drawbacks are conspicuously hidden in “small print”, usually near the back of the brochure.
This is where it can be helpful to have an unbiased third party on your side who can walk you through all of the details, without making your head spin and your eyes cross, and guide you towards the decision of whether or not the annuity is right for you.
Just to be clear, the American Equity Bonus Gold annuity – along with its additional riders – can provide you with some great benefits…provided that they fit in with your specific financial needs and goals.
So, if you have any additional questions or concerns about moving forward with the Bonus Gold annuity and/or its affiliated riders, please feel free to reach out to us via our secure contact form here.
Our team of annuity experts can help you to move through the myriad of information and come out the other side with a clear head, and a more well-informed decision on which direction to go in.