Lifetime annuities

Challenger lifetime annuities have a long death benefit period where a lump sum is payable to your estate or nominated beneficiaries. The death benefit is up to 100% of the amount invested. The maximum amount that could be received by your estate or beneficiaries depends on the time which has passed since you invested in the annuity up to the date of your death. You have the flexibility to remove this feature in return for higher regular payments.

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

While Challenger lifetime annuities are designed to be held for life, there is a long withdrawal period generally based on your life expectancy where you can ask to be repaid a lump sum amount if your circumstances change.

See the Product Disclosure Statement for more information.

Annuities are designed to complement your existing retirement income. Generally, you would invest only a portion of your super or retirement savings in order to 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 inflation changes or linked to changes in the RBA cash rate, helping you to continue to afford tomorrow what you can afford today.

A lifetime annuity (Flexible Income option) may immediately increase your Age Pension because only a portion of your investment is counted under the assets test. Any benefit will depend on whether you are assessed under the assets or income test. 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 linked to yearly inflation changes or changes in the monthly RBA cash rate, and are guaranteed for your lifetime regardless of how share markets perform.

For annuities purchased with your retirement savings (outside super), income payments and lump sum withdrawals may have some taxable income. Challenger provides an annual PAYG statement which has all the details you need to complete your tax return.

For tax treatment of death benefits see the FAQ ‘Are annuities taxable to beneficiaries?’.

Find out more about tax on super death benefits.

For annuities purchased with money from your savings outside superannuation , death benefits may have some tax payable. Challenger provides a PAYG statement which has all the details you need to do your tax return as a beneficiary.