What will be covered in this review?
In this review, we will be discussing the following details on the Lincoln Financial Insured Income Advisory annuity:
- Product type
- Current rates
- Realistic long-term return expectations
- How this annuity is best used
- How it is most poorly used
Annuities can be complex. That’s where having an Annuity Investigator who loves math comes in.
We make the complex, simple.
You’re likely aware that people are living longer lives today. In fact, life expectancy in the U.S. today is nearly double what it was back in the early 1900s. Because of that, retirees need to have a good solid strategy in place for securing an income that will last as long as they need it to. This includes constructing a plan for increased income later in life to help pay for healthcare and other (higher) living expenses down the road.
An annuity can solve that problem. In fact, annuities are designed to pay out a set amount of income for a certain period of time – including the remainder of your life, no matter how long that may be.
But before you go out and purchase just any annuity, it is important to have a good understanding of how these financial vehicles work, and what you can anticipate as far as performance. Otherwise, you could be sorely disappointed.
In addition to that, these products will often come with an insane amount of “fine print”, so while you may think that the annuity will offer you certain benefits, you may actually need to incur various waiting periods, fees, charges, and/or other types of tradeoffs in order to get the benefits you had anticipated.
That’s where Annuity Gator can help.
Annuity and Retirement Income Planning Information You Can Trust
If you’ve never been to our website before, please allow us to personally welcome you here. We are a team of annuity experts who have a key focus on offering in-depth information about annuities.
We have been at this for quite some time now – much longer than our competitors – although, depending on how long you’ve been researching annuities online, you may have already noticed some “copycat” sites.
Our reviews, which can be accessed in our annuity review database, are highly in-depth. They don’t just include the rosy picture of all the good features of individual annuities. Rather, they provide details about potential drawbacks, too, so that you can make a well-informed decision about whether or not a particular annuity is right for you.
We don’t think that annuities are bad – in fact, we believe that these financial vehicles can offer investors a long list of benefits…but only if the annuity fits in with your specific objectives. With that in mind, this annuity review is provided here for you to guide you on what to look for with the Lincoln Life Insured Income SPIA (Single Premium Immediate Annuity.
So, if you’re ready to get started, let’s dive in!
The Lincoln Financial Insured Income Single Premium Deferred Annuity at a Glance
|Product Name||Insured Income Annuity|
|Type of Product||Single Premium Immediate Annuity (SPIA)|
|Phone Number||(800) 672-4822|
Opening Thoughts on the Lincoln Life Insured Income SPIA Annuity
Lincoln has been in the business of helping its customers grow and protect wealth since 1905, when a group of business leaders in Fort Wayne, Indiana, came together to create a life insurance carrier that was based on dependability, honesty, and service.
As of mid-2019, Lincoln National is the 4th largest life and health insurer in the U.S. (based on 2018 revenue) with more than $16.4 billion in revenue. The company has amassed a long list of accolades including being ranked:
- #1 in variable universal life insurance sales
- #2 in universal life sales
- #6 in term life insurance sales
- #3 in total life insurance sales
- #5 in 401(b) employer-sponsored retirement plan market (assets)
- #3 in healthcare segment (assets)
- #8 in 401(k) market assets
Lincoln is also considered extremely strong and stable financially, and as such has earned high ratings from the insurer ratings agencies, including a(n):
- A+ from A.M. Best
- A+ from Fitch
- A1 from Moody’s
- AA- from Standard & Poor’s
Before we get into the gritty details, here are some necessary legal disclosures…
This is an independent annuity product review. It is not a recommendation to purchase or to sell an annuity. Lincoln Life Insurance Company has not endorsed this review in any way, nor do we receive any type of compensation for providing this review. This annuity review is meant solely to be an independent review at the request of our readers so that they may see our perspective when breaking down the positives and the negatives of this particular annuity. Prior to committing to the purchase of any type of insurance and/or investment vehicle, it is critical that you do your own due diligence, and that you also talk with a properly licensed professional if you have any questions that relate to your specific situation. All of the names, materials, and marks that have been used in compiling this annuity review are the property of their respective owners.
For additional information on how to compare variable annuities so that you can decide which may be the best one for you, click here in order to obtain our free truth about variable annuities report.
How Lincoln Life Describes the Insured Income Single Premium Immediate Annuity
The Lincoln Life Insured Income SPIA is a relatively new product that was introduced to help fee-only financial advisors provide options for clients who are seeking protected lifetime income in retirement.
As a SPIA (Single Premium Deferred Annuity), this financial vehicle is designed to defend against both market risk and longevity in retirement. It provides a consistent stream of income, regardless of stock market or economic conditions. And, because income can be relied upon for the long term, it can also help to make planning in other areas easier.
Dr. Wade Pfau, PhD, CFA, professor of retirement income and founder of RetirementResearcher.com, believes in the value of single premium immediate annuities. One reason for this is because a SPIA can offer a unique source of returns that is not available from a “traditional” investment portfolio. Adding a SPIA to your income plan can also help you to leave more assets for covering contingencies and/or for supporting your legacy.
According to Lincoln’s website, the Insured Income Immediate Annuity can help address the challenges of creating an adequate source of income for retirement by providing regular, guaranteed income that you can count on – regardless of how long you may need it.
This annuity offers several different income options to choose from, including single life, joint life, and period certain. You may also choose to receive this income on a monthly, quarterly, semi-annual, or annual basis.
There are some other additional features included with the Insured Income annuity from Lincoln Life. For example, a death benefit may be paid out to a named beneficiary, depending on which income option you choose.
You may also choose to increase your income amount through an annual compounded increase of 1%, 2%, or 3%. (Note that if you go with this option, your initial income payout will be smaller).
You can check out all of the features of the Lincoln Insured Income Immediate Annuity in the consumer brochure HERE.
How an Insurance or Financial Advisor Might “Pitch” this Annuity
If you’re working with an insurance or financial advisor who has presented you with the Lincoln Insured Income SPIA annuity, there are likely a few key items that he or she touched on in order to entice you to move forward and purchase it.
First, this product can offer you a guarantee when it comes to income in retirement. This includes providing you with an income stream that will last throughout the remainder of your lifetime. So, if safety and guarantees are what you’re looking for, the advisor likely touched on these features.
However, before you commit a large amount of your savings to this annuity, there are some things that you need to consider. For instance, once this annuity has been converted to income, the decision is non-reversible. This means that you will not be able to dig into your lump sum of cash – even if you have a financial emergency – once the income stream has started. With that in mind, then, it is imperative to keep in mind that the purchase of an annuity is a long term decision.
What About Fees on this Annuity?
As with other annuities, there are some tax- and fee-related areas to be aware of with the Lincoln Life Insured Income Single Premium Immediate Annuity (SPIA). For instance, in this case, if you purchase an immediate annuity with after-tax dollars, each of your income payments that are made will consist of both a taxable income portion and a return of premium portion (which is non-taxable).
However, if you rolled money over into the annuity from a traditional IRA and/or an employer-sponsored retirement plan (such as a 401k plan) where the money that you contributed to the annuity has not yet been taxed, then you will owe taxes on 100% of the income distributions that you receive. This, in turn, can make a big difference in the amount of income you are actually able to “net” and spend – as well as make a difference in your overall retirement lifestyle.
The Annuity Gator’s End Take on the Lincoln Life Insured Income Annuity
Where it works best:
Although a single premium immediate annuity might not be right for everyone, the Insured Income annuity from Lincoln Life could be a good option for you if you are hoping to achieve:
- A reliable income stream right away (or one that starts within 12 months after purchasing the annuity)
- A place to move funds from an IRA, 401(k), or other types of retirement plan so that you can convert it from a lump sum of savings into a reliable, ongoing income stream
- A solution for the concern about running out of income in retirement
Where it works the worst:
However, even though this annuity can offer you some nice benefits, it still may not be right for you if you:
- Think that you may need some (or all) of your funds for other needs after your income stream has begun
- Do not plan to use the annuity for income
Many people who are preparing for retirement have a concern about running out of income. This is particularly the case because life expectancy has increased significantly over the past several decades.
If you’ve been considering the purchase of a single premium immediate annuity, but you are still not entirely sure about moving forward because you just don’t know if this is the right financial vehicle for you, then it is imperative that you further your understanding of this product, and that you get all of your questions answered.
At Annuity Gator, we can assist you with any of the questions or concerns that you may have. We can also help you with “test driving” this annuity, as well as compare it against other similar annuities in order to determine which one may be best.
So, if you have any additional annuity questions, or if you would like to set up a test drive, then please feel free to reach out to us directly via our secure online contact form here.
If you are planning to move forward with the Lincoln Life Insured Income Single Premium Immediate Annuity, then you can be assured that you will have income for as long as you need it, based upon the income payout option that you choose. But there could be a better alternative out there for you, depending on your specific objectives.
Not quite sure if the Insured Income Single Premium Immediate Annuity from Lincoln Financial Company is right for you? Contact us and we’ll perform a test drive of this financial vehicle to determine how it may – or may not – work for you and your specific needs.
Have Any Additional Questions? Notice Any Mistakes in this Annuity Review?
We understand that this annuity review was a bit long. However, our feeling is that we would much rather provide “too much” information, as versus not enough. That can help you to make a more informed decision.
In any case, we are glad that you’ve stayed with us here to the end. And, if you felt that this review was informative, please feel free to forward it on to anyone else that you think may also benefit from it.
We also understand just how fast financial and insurance product information can – and does – change. So, if you happened to notice any details in this annuity review that were out of date or need updating, please let us know that, too, so that we can get it revised as soon as possible.
Are there any other annuities that you would like to also see reviewed?
If you have been shopping for annuities, it is possible that you’ve been presented with several different options. So, if you’ve come across any other annuities that are not included in our review database, please let us know via our secure online contact form here so that we can do our research and analysis and add the new review(s) to our website.
The Annuity Gator
P.S If you would like to read more of our Lincoln annuity reviews here are some links to check out:
- Independent Review of the Lincoln Financial MYGuarantee Plus Fixed Deferred Annuity
- Independent Review of the Lincoln National Covered Choice 5 Annuity
- Independent Review of the Lincoln National Lincoln OptiChoice Fixed Index Annuity
- Independent Review of the Lincoln National Life ChoicePlus Assurance Fee-Based Variable Annuity
- Independent Review of the Lincoln ChoicePlus Assurance Variable Annuity
- Independent Review of the Lincoln National Life Core Income Built with iShares Variable Annuity
- Independent Review of the Lincoln Financial Lifetime Income Edge Fixed Index Annuity
- Independent Review of the Lincoln American Legacy Variable Annuity
- Independent Review of the Lincoln Life Insurance Company’s Level Advantage B Share Annuity
- Independent Review of the Lincoln National Life Level Advantage Advisory Indexed Variable Annuity
- Independent Review of the Lincoln Financial Group Impact Advantage Fixed Indexed Annuity