Roll-up rate annuity is an informal term for an annuity contract, usually with an income rider, that heavily features a guaranteed roll-up rate on an income benefit base as its primary selling point. The contract may be a fixed indexed, variable, or RILA annuity where the rider's benefit base grows at a stated percentage during deferral, independent of market returns, as long as certain conditions are met. While these designs can create attractive projected lifetime income, they often involve rider fees, restricted investment options, and complex rules around withdrawals. The marketing focus on the roll-up rate can sometimes obscure other important contract features and trade-offs that impact actual retirement outcomes.

Advisors and wholesalers refer to certain products as roll-up rate annuities when training or discussing income solutions, emphasizing that the guaranteed increase in the income base is a key differentiator. They compare contracts by roll-up percentages, deferral periods, and payout factors, but best practice is to balance this with analysis of fees, liquidity, and long-term career commitments. Suitability and Reg BI reviews encourage advisors to avoid overselling the roll-up rate and to illustrate realistic scenarios including early withdrawals or shorter deferral periods. Explaining what a roll-up rate annuity really does-guaranteeing an income base, not investment returns-helps clients set appropriate expectations and reduces confusion at claim time.