T. Rowe Price Introduces Innovative Immediate Variable Annuity Featuring Income for Life and Guaranteed Minimum Payment
BALTIMORE, May 17 /PRNewswire/ -- T. Rowe Price Associates (Nasdaq: TROW) today introduced a no-load immediate variable annuity that offers the unique advantages of liquidity and a minimum guaranteed monthly income for life regardless of the performance of the underlying investments. In addition, the annuity offers a death benefit for beneficiaries throughout the first 15 years. Based on extensive feedback from investors, the T. Rowe Price Immediate Variable Annuity Income Account is designed so that investors can make withdrawals within the first five years of ownership based on the account value. The annuity also offers a guarantee that the monthly lifetime payments can never fall below 80% of the initial monthly payment.* Payments could increase, however, with favorable market performance. An immediate variable annuity provides guaranteed income regardless of how long the owner lives, but monthly payments can fluctuate based on the performance of the underlying investment options. Due to longer lifespans, retirees are growing increasingly concerned that they will outlive their savings. While they like the guaranteed income offered by immediate variable annuities, retirees have generally shunned these annuities because they typically cannot withdraw their assets if needed and because the income level could drop sharply after a sustained period of poor market performance, according to research done by T. Rowe Price. The Income Account overcomes these and other concerns by offering several innovative features: -- Liquidity Many immediate variable annuities do not allow withdrawals once the contract is in effect, limiting investors' access to their money. The Income Account allows investors to withdraw some or all of their assets for the first five years, subject to a withdrawal charge to cover the investment costs of the policy (not sales charges). -- Investment Protection Most variable annuities do not protect the investor in the event of a declining market. Since monthly payments are based on the performance of the underlying investments, a market downturn could result in significantly lower income. The Income Account guarantees that the monthly payment will never fall below 80% of the initial payment, regardless of market performance. -- Estate Protection The Income Account pays out a death benefit during the first 15 years of the contract life. -- Growth Potential Fixed immediate annuities do not offer the opportunity to increase their payouts over time to protect against inflation. The Income Account does so by offering a selection of investment choices, some of which have growth as their primary objective. "An immediate variable annuity can be an important part of an individual's retirement income strategy, especially for those who are concerned about outliving their assets," said James Riepe, Chairman of T. Rowe Price Investment Services. "With an increasing number of investors relying on 401(k)s and other defined contribution plans instead of traditional pension plans, securing some kind of guaranteed income for life is becoming more important. We designed our annuity to provide this security yet also address the obstacles that have discouraged investors from enjoying this benefit." The Income Account could be an appropriate investment option for: part or all of a company retirement plan distribution; married couples organizing their resources to provide income for as long as either spouse is alive; converting the current value of some retirement assets, such as an IRA, to a guaranteed lifetime income; or by any investor who has little or no guaranteed retirement income, such as from a pension or other retirement plan. For more information, investors can contact T. Rowe Price at 1-800-469-5304. The Income Account is issued by Security Benefit Life Insurance Company. Founded more than 100 years ago, Security Benefit Life is a Kansas-based insurer with more than a quarter century of experience in providing variable annuities. Security Benefit Life is a member of the Security Benefit Group of Companies, which has approximately $9 billion in assets under management. T. Rowe Price and its affiliates manage about $150 billion in assets for more than seven million individual and institutional accounts. The company, investment adviser to the T. Rowe Price family of funds, is one of the nation's leading providers of no-load mutual funds. *This guaranteed minimum is subject to the claims-paying ability of Security Benefit Life Insurance Company. For more complete information about the immediate variable annuity, or the T. Rowe Price mutual funds, including management fees and other charges and expenses, call 1-800-469-5304 and request a prospectus. Read the prospectus carefully before investing. The immediate variable annuity may not be available in all states. T. Rowe Price Investment Services, Inc. T. ROWE PRICE IMMEDIATE VARIABLE ANNUITY INCOME ACCOUNT KEY FEATURES -- Minimum investment: $25,000 (There is no maximum, but investments over $1 million are subject to the approval of Security Benefit Life.) -- Access to Investment: During the first five years you own the Income Account, you may withdraw any part or all of your investment. The amount you withdraw is subject to a withdrawal fee of 5% in year 1, declining to 1% in year 5, to cover the cost of the guaranteed features. Withdrawals are not permitted after year 5. (Note: "withdrawal" does not refer to your regular monthly annuity payments.) -- Monthly payment: ...is guaranteed at 80% of your initial monthly payment for as long as you live;* ...is recalculated once a year, based primarily on the performance of your investment portfolio, as measured against the benchmark interest rate. -- Investment flexibility: Choose from six T. Rowe Price-managed portfolios, investing in one, a combination, or all six. You are free to exchange among these portfolios up to six times a year at no charge. -- Death Benefit: Years 1 through 5. During the first five years of ownership, the death benefit equals the sum of all current balances in your investment portfolio. Any withdrawals made during the first five years will reduce your death benefit, your current monthly payment, your guaranteed minimum payment amount, and the amount of income available to you in the future. Years 6 through 15. During these years, the death benefit equals the present value of your future monthly payments, through year 15, paid as a lump sum -- OR -- your beneficiary may continue to receive monthly payments through year 15. After Year 15. If you die after year 15, there is no death benefit and no future monthly payments will be made. *This guaranteed minimum is subject to the claims-paying ability of Security Benefit Life Insurance Company.
SOURCE T. Rowe Price Associates, Inc.
Browse our custom packages or build your own to meet your unique communications needs.
Learn about PR Newswire services
Request more information about PR Newswire products and services or call us at (888) 776-0942.