PDF LINCOLN VARIABLE ANNUITIES Income calculator
LINCOLN VARIABLE ANNUITIES
Income calculator
i4LIFE? Advantage
Client Guide
Not a deposit Not FDIC-insured May go down in value Not insured by any federal government agency Not guaranteed by any bank or savings association Insurance products issued by: The Lincoln National Life Insurance Company Lincoln Life & Annuity Company of New York
2461547
Calculate your i4LIFE? Advantage payment
To help demonstrate, the following is a comparison of returns between i4LIFE and nonqualified (NQ) systematic withdrawals from a variable annuity. These percentages may be applied to any initial investment.
A variable annuity is a long-term investment product that offers tax-deferred growth, access to leading investment managers, and a lifetime income stream. To decide if a variable annuity is right for you, consider that its value will fluctuate; it is subject to investment risk and possible loss of principal; and there are costs associated such as mortality and expense, administrative and advisory fees. All guarantees, including those for optional features, are subject to the claims-paying ability of the issuer. Limitations and conditions apply.
Male, single life
i4LIFE Advantage
For immediate income
Age
First-year total income
Nontaxable portion
45
4.51%
49%
46
4.53%
50%
47
4.56%
51%
48
4.59%
51%
49
4.62%
52%
50
4.67%
51%
51
4.71%
52%
52
4.75%
53%
53
4.79%
54%
54
4.83%
55%
55
4.88%
56%
56
4.92%
56%
57
4.98%
58%
58
5.03%
58%
59
5.09%
60%
60
5.17%
61%
61
5.24%
61%
62
5.31%
63%
63
5.39%
64%
64
5.47%
65%
65
5.56%
67%
66
5.65%
67%
67
5.76%
69%
68
5.87%
71%
69
5.99%
72%
70
6.16%
73%
71
6.21%
74%
72
6.26%
74%
73
6.30%
74%
74
6.34%
75%
75
6.39%
75%
76
6.43%
75%
77
6.47%
76%
78
6.52%
75%
79
6.57%
75%
80
6.69%
74%
81
6.72%
74%
82
6.76%
74%
83
6.79%
73%
84
6.82%
73%
85
6.85%
74%
NQ comparable systematic withdrawal
5.69%
5.75% 5.81% 5.86%
5.91%
5.96% 6.03% 6.11% 6.17% 6.25% 6.34% 6.42% 6.52% 6.61% 6.72% 6.86% 6.97% 7.11% 7.26% 7.39% 7.55% 7.70% 7.89% 8.10% 8.29% 8.59% 8.68% 8.76% 8.82% 8.91% 8.97% 9.01% 9.12% 9.16% 9.21% 9.35% 9.39% 9.45% 9.45% 9.51% 9.58%
The above returns are only estimates of an initial annualized return based on a 35% tax bracket. The tax-exclusion amount varies by age and only applies until the original cost basis in the contract has been recovered. Systematic withdrawals are fully taxable until the gain in the contract (if any) is completely withdrawn. To receive the same net, after-tax first payment, you would have to make a systematic withdrawal in the amount shown here, expressed as a percentage of the initial investment (assuming all of the withdrawal represents gain).
i4LIFE? Advantage
When you are ready to transition from saving for retirement to taking retirement income payments, i4LIFE is an option available through Lincoln Investor Advantage? variable annuity for an additional annual charge of 0.40%, above standard contract expenses.
Female, single life
i4LIFE Advantage
For immediate income
Age
First-year total income
Nontaxable portion
45
4.48%
49%
46
4.50%
50%
47
4.53%
51%
48
4.56%
52%
49
4.59%
52%
50
4.64%
51%
51
4.67%
53%
52
4.71%
54%
53
4.75%
54%
54
4.79%
55%
55
4.83%
56%
56
4.88%
57%
57
4.92%
58%
58
4.98%
59%
59
5.03%
60%
60
5.12%
61%
61
5.18%
62%
62
5.25%
64%
63
5.32%
65%
64
5.40%
66%
65
5.48%
68%
66
5.57%
68%
67
5.67%
70%
68
5.77%
72%
69
5.88%
73%
70
6.06%
74%
71
6.11%
75%
72
6.16%
76%
73
6.21%
75%
74
6.26%
76%
75
6.31%
76%
76
6.35%
75%
77
6.40%
77%
78
6.45%
76%
79
6.50%
75%
80
6.63%
75%
81
6.67%
74%
82
6.70%
75%
83
6.74%
73%
84
6.77%
74%
85
6.81%
75%
NQ comparable systematic withdrawal
5.66%
5.72% 5.78% 5.82%
5.87%
5.92% 5.99% 6.07% 6.13% 6.21% 6.30% 6.37% 6.47% 6.56% 6.67% 6.81% 6.91% 7.04% 7.19% 7.31% 7.47% 7.62% 7.80% 8.00% 8.19% 8.48% 8.58% 8.67% 8.73% 8.83% 8.89% 8.93% 9.05% 9.09% 9.14% 9.29% 9.33% 9.39% 9.39% 9.46% 9.54%
These assumptions represent a Lincoln Investor Advantage nonqualified B-Share variable annuity with i4LIFE Advantage, the Account Value death benefit, a 4% assumed interest rate (AIR), and the minimum of the greater of 20 years or to age 90 Access Period. Payments may vary slightly in certain states.
With other Lincoln variable annuities, you can elect i4LIFE? Advantage with the Guaranteed Income Benefit (GIB) for an additional annual cost of 1.35% above standard contract expenses, or 1.55% for joint coverage (2.25% for single and 2.45% for joint maximum). The GIB ensures that income payments will last the rest of your life and never be less than a minimum payout floor, regardless of the actual investment performance of your contract. The GIB is not available on Lincoln Investor Advantage? contracts.
Joint life
i4LIFE Advantage
For immediate income
Age First-year total income
Nontaxable portion
45
4.42%
49%
46
4.44%
50%
47
4.47%
51%
48
4.49%
51%
49
4.52%
52%
50
4.56%
52%
51
4.59%
53%
52
4.62%
53%
53
4.66%
54%
54
4.69%
55%
55
4.73%
56%
56
4.77%
57%
57
4.81%
58%
58
4.86%
59%
59
4.91%
60%
60
4.99%
60%
61
5.04%
62%
62
5.10%
63%
63
5.16%
64%
64
5.23%
66%
65
5.30%
66%
66
5.38%
68%
67
5.46%
70%
68
5.54%
71%
69
5.64%
73%
70
5.80%
74%
71
5.86%
74%
72
5.91%
75%
73
5.96%
75%
74
6.02%
76%
75
6.07%
76%
76
6.13%
77%
77
6.19%
76%
78
6.25%
77%
79
6.32%
76%
80
6.46%
75%
81
6.51%
75%
82
6.55%
74%
83
6.60%
74%
84
6.65%
74%
85
6.69%
73%
NQ comparable systematic withdrawal
5.59%
5.63% 5.68% 5.72%
5.78%
5.84% 5.90% 5.95% 6.02% 6.08% 6.16% 6.24% 6.30% 6.40% 6.49% 6.60% 6.71% 6.82% 6.94% 7.08% 7.19% 7.34% 7.50% 7.67% 7.84% 8.10% 8.19% 8.30% 8.37% 8.48% 8.55% 8.67% 8.74% 8.83% 8.91% 9.07% 9.13% 9.17% 9.24% 9.28% 9.33%
You choose the length of the Access Period and the assumed interest rate (AIR). The minimum Access Period is 5 years and the maximum is up to age 115 (age 100 for qualified contracts). The AIR can range from 3% to 6% (all options not available in all states) and impacts the initial and subsequent payments. Additional withdrawals reduce the cost basis, account value, death benefit and future income payments. After the Access Period ends, payments will continue on a lifetime basis, but you will no longer have access to your assets or a death benefit.
Income powered by innovation
Tax-efficient income using i4LIFE? Advantage
While taxes can significantly affect the growth of your portfolio, they also play an important role when you're ready to take income from your investments. To take advantage of the benefits of tax deferral, you'll want a tax-efficient income strategy to help you keep more of what you earned.
Lincoln Investor Advantage? variable annuity offers a number of distribution options to meet various income needs. For those seeking tax efficiency, i4LIFE Advantage, a living benefit rider available for an additional cost, may be a wise choice.
i4LIFE, Lincoln's patented income distribution method, has been helping investors minimize the impact of taxes on their income since 2001.
When investing with nonqualified money, i4LIFE:
? Provides tax-efficient income by returning a portion of your original investment with each payment, which has already been taxed, and any gains that may have occurred
Systematic withdrawals
If there are gains in the contract, systematic withdrawals start with fully taxable gains being paid out first, resulting in less current income for you.
Gains Principal
Gains Principal
i4LIFE payments
If there are gains in the contract, i4LIFE includes a portion of the nontaxable principal along with the gains in each payment--saving you money in taxes.
For systematic withdrawals, if there are no gains, all withdrawals are considered principal and are not taxed.
For i4LIFE, if the contract experiences no gains or is down during a particular year, a portion of your payment is still treated as a taxable gain and a portion is treated as principal. Once the entire principal has been paid out, each payment is fully taxable.
? Results in an overall after-tax payment that is typically higher than with a systematic withdrawal because your payment includes a nontaxable return of principal
? Allows you to continue to participate in the growth potential of the market
? Continues to provide access to your money and investment options
? Includes options for passing your income on to future generations without the tax burden often incurred from typical transfers of wealth
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