Principal Deferred Income Annuity and QLAC


Principal Deferred Income Annuity provides a future stream of pension-like payments to you in retirement. 

Principal Deferred Income Annuity and QLAC allow you to put money aside now so you’ll have a steady stream of income later.

When you purchase a deferred income annuity, you choose when to begin and how often you want to receive income.

Ensuring you have enough money in retirement can seem overwhelming.

But we have a solution that may help by providing guaranteed lifetime income you can’t outlive



How does a deferred income annuity work?

In short, deferred income annuities allow you to buy income.

You pay a lump sum — or make a series of payments over time — in exchange for guaranteed income for a specific period of time or life that begins on a future date that you choose.

The trade-off is that you no longer have access to use those funds.

Instead, they’ve been used to purchase a guaranteed future income for you when you need it.

Deferred income annuities aren’t invested in the market, which means you won’t be exposed to market ups and downs.

What you will receive is predictable, continuous income payments guaranteed for life dependent upon the income option selected.

Here’s the gist:

  1. Choose your income start date
  2. Choose your income payout option and payment frequency: monthly, quarterly, semiannually, annually
  3. Relax, knowing that your income payments are guaranteed for the time period you selected


Create and tailor your income

Choose when you want to start receiving income.

Select a date to begin receiving income anywhere from 13 months to 30 years in the future (up to age 95 for nonqualified money, 72 for qualified money or the first day of the month after the owner reaches age 85).

If your needs change before you begin receiving income, you get a one-time option to change your income start date.

Put more in to get more out.

You can increase your income by adding additional premiums up until 13 months prior to your income start date.

Doing so may help meet any future unplanned or planned expenses.

Cover for an emergency.

Unexpected expenses are part of life.

To help feel confident in facing those “surprises,” you have the flexibility to accelerate up to six monthly payments into a single lump-sum payment, up to four times throughout the life of your contract.

Income to meet your needs.

Select from single or joint lifetime annuity income options that best meet your needs.

Fixed period (not available with QLAC)

Receive payments for a fixed period between five and 20 years.

If you die before the end of the selected period, payments continue to your beneficiary until the end of the period.

Life only

Receive guaranteed income payments for the rest of your life.

Doesn’t provide a death benefit if death occurs after the annuity income start date.

Life with guarantee period (not available with QLAC)

Receive payments for your life or a designated period (up to 30 years), whichever is longer.

Life with cash refund

Lifetime payments continue until the death of the annuitant.

If income payments haven’t depleted your total premium at death, the difference will be paid to your beneficiary in a lump sum

Life with installment refund (not available with QLAC)

Lifetime payments continue until the death of the annuitant.

If income payments haven’t depleted your total premium at death, income payments will continue to your beneficiary until payments equal total premiums paid.



What about required minimum distributions?

A qualifying longevity annuity contract (QLAC) may be just what you need.

A deferred income annuity can be purchased as a QLAC.

A QLAC provides you with the opportunity to defer a portion of your required minimum distributions for qualified money up to age 85.

By deferring a portion of income to a later date, you delay paying taxes on the money you may not need early in retirement.


What happens if I die before payments start?

Sometimes the unexpected can happen, and planning for those unexpected events can impact your financial future.

If you die prior to payments starting, your beneficiary is guaranteed to receive your premium amount back.

If you choose to elect the optional roll-up death benefit feature, your death benefit will increase annually by 1%, 2% or 3% during the deferral period.

The death benefit is paid to the beneficiary when the owner (and joint owner if any) dies before to the income start date.

After income payments have started, the death benefit will depend on the annuity income option elected.


Additional features

These features are available to you for no additional cost.

Automatically included

Income start date adjustment

Prior to receiving payments, you can make a one-time change (accelerate or postpone) to your income start date

    • May accelerate the income start date up to five years (as long as it’s been at least 13 months since the last premium payment)
    • May postpone the income start date up to five years from the original income start date (must be within the maximum deferral period limits)
    • Your income payment amount will change to reflect your new income start date

Payment advancement

  • Allows you to advance up to six income payments and receive in a lump sum
  • Automatically issued at no additional cost, subject to state availability
  • Available for nonqualified contracts receiving monthly income payments only (not available with other payment frequencies)
  • Not available for qualified contracts, including QLAC
  • Must be at least age 59½
  • Available to utilize after the income start date
  • Limited to four requests over the life of the contract
  • Income payments must resume before this option may be used again


Inflation protection

Annual Increase Rider
  • At issue, elect to have payments increase annually by 1%, 2%, 3%, 4% or 5%
  • Income payments are lower at first, but will automatically increase each year
  • Applies during the income phase
  • Not available when purchased as a QLAC
Consumer Price Index (CPI) Rider
  • At issue, elect to have income payments adjusted annually for increases (if any) in the CPI for All Urban Consumers (CPI-U)
  • Income payments are lower at first but have the opportunity to increase
  • Applies during the income phase
  • Not available when purchased as a QLAC

Roll-up death benefit during the deferral

  • Elect to have the death benefit during the deferral period increase annually by 1%, 2%, or 3% if death occurs before the income start date
  • Interest is compounded annually, credited daily from the date each premium is received
  • Available through issue age 79
  • Income payments will be lower if this benefit is elected
  • Not available when purchased as a QLAC



Minimum Premium

Maximum Premium

Company Rating (A.M. Best)

Maximum Issue Age

Insurance Company

Enhanced Benefits

Premium Type

Annuitization Required

Annual Penalty-Free Withdrawals

Death Benefit

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Annuitization Payouts

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State Availability

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Premium Bonus (Up to)

Contract Length

Annual Fees

Liquidity Options

Surrender Charge Waivers

Accepted Funds

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