Lifetime income benefit (LIB)

Helping you maintain an income for the rest of your life.

What is it?

Canadians making the transition into retirement want help using their hard-earned savings to remain comfortable, financially, for the rest of their lives. By choosing a segregated fund policy with the lifetime income benefit (LIB) option, you’re guaranteed income for your lifetime regardless of how long you live – age 85, 95, 100, it doesn’t matter.1

The LIB can be added to a well-diversified retirement income portfolio and is designed for people who want a secure and predictable income and don’t already have guaranteed income through government benefits, work pension plans or life annuities. To determine if the lifetime income benefit is right for your specific financial situation, speak with your financial security advisor.2

How does it work?

Some segregated fund policies come with a lifetime income benefit option that, for a monthly fee, guarantees your income will remain the same for the rest of your life, no matter how the segregated fund performs.3

Only making excess withdrawals (or any withdrawal amount that is above the annual guaranteed income amount) from the segregated fund policy will decrease the amount of income you receive through the LIB.

You can start receiving income through an LIB as early as age 50 and the percentage used to calculate the lifetime income amount increases with age.

How will it benefit me?

Guaranteed and predictable income for life

The LIB offers a steady income for the rest of your life, no matter how long you live and no matter how the market performs. Only making excessive withdrawals will affect the amount of income you receive.

Start receiving income early

You can begin the lifetime income benefit as early as age 50.

Deferral bonus

The LIB allows for an annual deferral bonus that can help you grow your lifetime income amount even when markets are down. You’re eligible to earn a three per cent deferral bonus every year until you make a withdrawal.4

Income resets

As the policy value increases, you have the potential to secure those gains to increase your lifetime income amount. For more information about income resets, talk to your financial security advisor.

1 Excess withdrawals from the lifetime income benefit can affect the amount of money available through the LIB. Speak with your financial security advisor to learn more.

2 The Great-West Life segregated fund contract and information folder contain complete details about the all the features of the lifetime income benefit. You should read them carefully to ensure you understand the lifetime income benefit and its features.

3 When you add the lifetime income benefit to your segregated fund policy, your eligible lifetime income amount is determined by the market value of your policy multiplied by the income percentage associated with your age or the age of the youngest spouse (if you choose a joint-life income).

4 Deferral bonuses are not a guaranteed rate of return. They have no cash value.

Talk to an expert

Not feeling confident in your finances? You can talk to one of our financial security advisors who will work with you to craft a financial plan tailored to your needs.

Contact an advisor