After getting a boost from a federal rule change last year, deferred income annuities have been gaining sharply in both assets and interest. Advisors should now understand what these products can do for clients and what challenges they carry.
The products are best understood in contrast with traditional immediate annuities, in which consumers give money to an insurer and receive a set amount of cash flow right away. With their deferred counterparts known as deferred income annuities, or DIAs consumers wait to receive payments in order to channel a larger income stream.
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