An insurer has released a new product designed to provide an alternative source of retirement income for those aged 55 to 75.
The product, Annuity Note, promises a lifetime income of 5% based on the higher value of either the total amount invested or the contract’s anniversary value after 5 years, according to John Hancock Financial, Boston, a unit of Manulife Financial Corporation, Toronto.
If no withdrawals have occurred by the 5-year anniversary, at worst the annual income would be 5% of the initial contract payment. If market growth has increased the contract’s value after 5 years, then the annual income would equal 5% of the 5-year value, says Hancock.
Investors will receive the income monthly, and its payment is guaranteed for life.