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One of your clients is looking to annuitize a contract and wants a payout option that will provide income for the later of 10 years or death. Which of the following choices is most suitable for this investor?

A. Straight life
B. Straight life with period certain
C. Variable annuity
D. Fixed annuity

User Brady Isom
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1 Answer

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Final answer:

The most suitable option for a client who wants guaranteed income for the later of 10 years or death is the Straight life with period certain annuity.(option B)

Step-by-step explanation:

A client looking for a payout option that will provide income for at least 10 years or until death should opt for a B. Straight life with period certain annuity. This type of annuity guarantees income for a set period (in this case, 10 years) regardless of how long the annuitant lives, and will continue payments if the annuitant lives beyond the specified period. Such annuities address the concerns associated with fixed incomes and the potential loss of buying power due to inflation, which can pose a problem for retirees relying on defined benefit pensions or other fixed income sources for their old age.

User JAre
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