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Accelerated annuity

You may elect to receive an accelerated (greater) monthly retirement annuity amount until age 62, 65 or Social Security normal retirement age (NRA), instead of a regular monthly retirement annuity. For example, if you retire at age 58, you can choose to accelerate to age 62, 65 or your NRA; if you retire at age 64, you can choose to accelerate to age 65 or your NRA.

Watch our video "Choosing whether to accelerate your benefit."

This type of annuity is meant to pay a larger benefit during the years before you qualify for Social Security or before other investment payments begin. An accelerated annuity is the sum of two separate annuities:

  • a term annuity payable from your retirement date until you reach the age of acceleration (accelerated/temporary portion); and

  • an annuity payable for your lifetime (lifetime portion).

At the age of acceleration, payment of the accelerated/temporary portion of the annuity ends, but you continue to receive the lifetime annuity payment amount. Please be aware that the accelerated/temporary portion of the annuity will end on your birth date. The more you choose to accelerate prior to the age of acceleration, the less the lifetime annuity portion will be.

The amount by which the regular lifetime annuity is accelerated or increased is subject to a maximum amount as prescribed by law. You may choose to receive the maximum amount of acceleration or any lesser amount. If a lesser amount is chosen, the amount available for payment after the age of acceleration is greater.

If you elect an accelerated annuity, you have up to two months following your initial payment date during which you may cancel or change your election.

If you die before reaching the age of acceleration, the accelerated/temporary annuity amount (term annuity) continues to be payable to a designated beneficiary until the date when you would have reached the accelerated age you chose. If there is no surviving designated beneficiary, payment would be commuted and paid in a lump sum to your estate.

It is important to note that the survivor benefits available after the age of acceleration and any annual increases that may occur after these ages will be less as a result of electing an accelerated rather than a regular life annuity. An annual post-retirement increase, if specified by law, is applied to the accelerated/ temporary portion of the annuity until you reach the age of acceleration. For the lifetime annuity, any annual increases are accumulated until the last required payment is made.

We recommend that you thoroughly acquaint yourself with the pros and cons of taking an accelerated annuity before electing this option.

Example #1

If you were eligible at age 58 for a No Refund plan benefit of $1,000 a month and you elected an accelerated benefit to age 62, you would receive $1,543 each month until your 62nd birthday and $800 a month after age 62 for life, plus any post-retirement increases, if specified by law, on this amount.








Age




No Refund Life Plan Annuity
(Amounts will vary if a different
plan is chosen)

(A) minus (B) = (C)
$ after age 62



(A)
Payable
Until
Age 62

(B)
Ends at Age 62:
Accel/ Temp Annuity



(C)
Payable
for
Lifetime

52

$1,000

$1,438

$938

$500

53

$1,000

$1,454

$904

$550

54

$1,000

$1,471

$871

$600

55

$1,000

$1,488

$838

$650

56

$1,000

$1,506

$806

$700

57

$1,000

$1,524

$774

$750

58

$1,000

$1,543

$743

$800

59

$1,000

$1,563

$713

$850

60

$1,000

$1,583

$683

$900

61

$1,000

$1,604

$654

$950

62

$1,000

NA NA NA

63

$1,000

NA NA NA

64

$1,000

NA NA NA

65

$1,000

NA NA NA

66

$1,000

NA NA NA

67

$1,000

NA NA NA


Example #2

If you were eligible at age 58 for a No Refund plan benefit of $1,000 a month and you elected an accelerated benefit to age 65, you would receive $1,457 each month until your 65th birthday. After your 65th birthday, you would receive $650 a month for life, plus any post-retirement increases, if specified by law, on this amount.

 

(A) minus (B) = (C)
$ after age 65




Age

No Refund Life Plan Annuity (Amounts will vary if a diferent plan is chosen)


(A) Payable Until
Age 65


(B)
Ends at Age 65: Accel/ Temp Annuity


(C)
Payable for Lifetime

52

$1,000

$1,364

$1,014

$350

53

$1,000

$1,378

$978

$400

54

$1,000

$1,393

$943

$450

55

$1,000

$1,408

$908

$500

56

$1,000

$1,424

$874

$550

57

$1,000

$1,440

$840

$600

58

$1,000

$1,457

$807

$650

59

$1,000

$1,475

$775

$700

60

$1,000

$1,493

$743

$750

61

$1,000

$1,512

$712

$800

62

$1,000

$1,532

$682

$850

63

$1,000

$1,552

$652

$900

64

$1,000

$1,573

$623

$950

65

$1,000

NA

NA

NA

66

$1,000

NA

NA

NA

67

$1,000

NA

NA

NA



Example #3

If you were eligible at age 58 for a No Refund plan benefit of $1,000 a month and you elected an accelerated benefit to age 67, you would receive $1,402 each month until your 67th birthday. After your 67th birthday, you would recieve $550 a month for life, plus any post-retirement increases, if specified by law, on this amount.

(A) minus (B) = (C)
$ after age 67



Age
No Refund Life Plan Annuity (Amounts will vary if a diferent plan is chosen)


(A) Payable Until
Age 67


(B)
Ends at Age 65: Accel/ Temp Annuity


(C) Payable for
Lifetime

52
$1,000

$1,316

$1,066

$250

53
$1,000

$1,328

$1,029

$299

54
$1,000

$1,340

$991

$349

55
$1,000

$1,357

$957

$400

56
$1,000

$1,370

$921

$449

57
$1,000

$1,385

$886

$499

58
$1,000

$1,402

$852

$550

59
$1,000

$1,418

$818

$600

60
$1,000

$1,435

$785

$650

61
$1,000

$1,453

$753

$700

62
$1,000

$1,471

$721

$750

63
$1,000

$1,490

$690

$800

64
$1,000

$1,509

$659

$850

65
$1,000

$1,528

$629

$899

66
$1,000

$1,550

$600

$950

67
$1,000 NA NA NA

 


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