Lifetime annuities

Lifetime annuities

Provides a guaranteed regular income for your lifetime regardless of how investment markets perform or how long you live.

Challenger lifetime annuities complement other retirement investments and sources of income, such as account-based pensions and the Age Pension. They provide a secure lifetime income which can be used as the foundation of your retirement plan.

About the Challenger Guaranteed Annuity (Liquid Lifetime)

The Challenger Guaranteed Annuity (Liquid Lifetime) is a lifetime annuity that pays a regular income for life in return for a lump sum investment. The regular income we agree to pay you is guaranteed for your lifetime, regardless of how long you live or how investment markets perform – giving you peace of mind in retirement.

You can use your super or personal savings to invest with a minimum investment amount of $10,000. Liquid Lifetime provides:

  •  guaranteed monthly payments for life (and your spouse’s life if you choose)
  •  payments that start immediately or on a future date you choose
  • payments that keep pace with inflation*
  • flexibility to withdraw and be paid a lump sum if your circumstances change within the withdrawal period*
  • a known estate value via a guaranteed death benefit*

*You can ask us to remove these features in return for higher starting payments. But the choice is totally yours.

Visit the payment rates page to see how this compares to other investments.

Frequently asked questions

While Challenger lifetime annuities are designed to be held for life, you have the flexibility to access a lump sum within a defined period if your circumstances change. You can ask us to remove this feature in return for higher starting payments when you initially invest in your annuity. But the choice is totally yours. See the Product Disclosure Statement for more information.

Challenger lifetime annuities pay a guaranteed death benefit if you die early. The death benefit is up to 100% of the amount you invest and is payable to the beneficiaries you nominate or to your estate. You can ask us to remove this feature in return for higher starting payments when you initially invest in your annuity. But the choice is totally yours.

This gives you certainty and control over your estate planning outcomes. See the relevant Product Disclosure Statement for more information.

With a lifetime annuity (Flexible Income option) only a proportion of your investment is counted under the assets test. This could result in an immediate increase in your Age Pension. Refer to the Additional information guide for how our different lifetime annuities are assessed. Speak with your financial adviser before making any financial decisions.

When comparing lifetime annuities to other investments it is important to compare them to similar secure investments and not to shares or other higher risk assets. Lifetime annuities give you income certainty, so they are likely to give you lower returns than higher risk investments where you may receive higher returns but you can also incur losses (for example if there were to be another Global Financial Crisis).

Challenger’s lifetime annuities are a smart defensive asset because they offer competitive payment rates. These payments can be inflation-linked and are guaranteed for your lifetime regardless of how markets perform. Learn more about the feature of annuities.

You don’t have to invest all of your money into a Challenger lifetime annuity. You can invest only a portion of your retirement savings and receive a level of secure, guaranteed income for life. You can invest as little as $10,000.

Inflation measures the change in the cost of living over time. Payments from Challenger annuities can be linked to yearly changes to inflation, helping you to continue to afford tomorrow what you can afford today.

Challenger annuities are guaranteed by Challenger Life, a Life Company regulated by the Australian Prudential Regulation Authority (APRA). Challenger Life is subject to detailed legislative and regulatory requirements designed to ensure that your investment is kept safe. APRA continuously monitor our investments with the aim of ensuring that we can meet the promises that we have made to you both now and into the future. APRA is the same authority that regulates banks in Australia. APRA can require us at any time to change how we invest or tell us to invest more capital into the statutory fund.

 

You are in safe hands with Challenger. The money we receive from your investment is held separately in a statutory fund. This statutory fund is required to hold enough capital to withstand a one in 200-year investment market shock event.

When you invest in a Challenger lifetime annuity your capital investment goes into a fund along with the capital received from other annuity investors. This fund is known as the statutory fund, and all regular payments to our annuity investors are paid from this fund. We are also required by the Australian Prudential Regulation Authority (or APRA for short) to invest our own money into the fund.

APRA continuously monitors the statutory fund’s investments, the aim of which is to ensure that we can meet the promises that we have made to you. APRA is the authority that regulates the banking, insurance and superannuation industries. If at any time we do not achieve investment returns that are sufficient to cover all the promises that we have made to our annuity investors, we must cover the shortfall from the money we have invested in the fund. Find out more about our guarantee.

We invest the money you give us. If we achieve investment returns that are above the amount required to cover the promises made to our annuity investors, we keep the excess amount. This is how we make a profit. If we do not achieve investment returns that are sufficient to cover all promises made to our annuity investors, we cover the shortfall from our own money.