Lifetime income benefit is a feature commonly found in annuity contracts, especially fixed indexed annuities, that guarantees the annuity owner a specified income stream for life once activated, regardless of market performance or how long they live. It is often provided by an optional rider with its own fee and is based on an income benefit base that may increase by roll up rates or step ups. The benefit does not necessarily equal the account value, which can be exhausted while payments continue. Lifetime income benefits are designed to provide predictable retirement income while allowing some accumulation before the income start date.

In everyday practice, advisors use lifetime income benefit riders to address client fears about outliving assets without giving up all flexibility on day one. They illustrate how the income base grows during the deferral period, how guaranteed withdrawal percentages apply at different ages, and what happens if markets perform well or poorly. Advisors clarify that the income base is a calculation value, not a lump sum clients can cash out, and that rider fees reduce the actual account value. They help clients decide when to turn on income, often coordinating with Social Security and other sources to optimize tax and cash flow. When positioning these riders, producers compare them to immediate annuities, pensions, and systematic withdrawal strategies, highlighting strengths and limitations. By understanding lifetime income benefits thoroughly, advisors can recommend riders appropriately, avoid misunderstandings about values, and integrate guarantees into comprehensive retirement income plans.