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Joint and Survivor Annuity


A Joint and Survivor Annuity is a type of annuity contract designed to provide income for two individuals, typically spouses or partners. It guarantees regular payments for as long as either beneficiary is alive. When one beneficiary passes away, the survivor continues to receive payments, which may either stay the same or be reduced based on the chosen payout option.


“Joint and Survivor Annuity” in phonetics would be: /ʤɔɪnt ənd sərˈvʌɪvər ænˈnuːəti/

Key Takeaways


  1. Income for Two Lives: A Joint and Survivor Annuity provides a guaranteed stream of income for the duration of both the primary annuitant’s and the joint annuitant’s lives. This ensures financial security for both individuals and can be particularly beneficial for married couples or life partners.
  2. Payout Choices: There are different payout options available, which dictate the percentage of the primary annuitant’s income that the joint annuitant will receive upon the primary annuitant’s death. Common choices include 50%, 75%, or 100% survivor benefits. The higher the chosen percentage, the lower the initial payout for the primary annuitant will be.
  3. Duration and Guarantees: In some cases, a Joint and Survivor Annuity may offer a guaranteed payment period, such as 10 or 20 years, in addition to the lifetime payouts for the annuitants. If both annuitants pass away before the end of the guaranteed period, the remaining payments will be made to a designated beneficiary.


The Joint and Survivor Annuity is an important term in business and finance as it ensures a steady stream of income for two individuals, usually spouses or partners, throughout their lifetime, thereby providing them financial security and stability. This type of annuity continues the payment benefits even after the death of the primary annuitant, allowing the surviving partner to maintain their standard of living without worrying about depleting financial resources. Consequently, Joint and Survivor Annuities play an essential role in long-term financial planning, especially for couples in their retirement years.


A Joint and Survivor Annuity is a financial product designed primarily for couples seeking to ensure a continuous stream of income after retirement for both partners, regardless of which one lives longer. The purpose of this annuity is to provide peace of mind for couples who want to make sure that their spouse is financially secure in the event of either’s passing. This type of annuity is generally purchased using a lump sum, or by making regular contributions over time. It is commonly considered as part of a comprehensive retirement strategy, offering a stable and reliable income for as long as either party is alive. The way a Joint and Survivor Annuity works is by providing a predetermined, regular income to the annuity holders during their retirement years. Upon the death of the first annuitant, the surviving spouse will continue to receive payments, typically at a reduced rate, such as 50%, 66.67%, or even 100% of the initial payment level. These payments are maintained for the duration of the surviving spouse’s life to ensure continued financial security. Therefore, this annuity type eliminates worries about a surviving spouse outliving their retirement funds, allowing retirees to better plan their expenses, and helping them to enjoy a more stress-free and comfortable retirement together.


1. Married Couple Retirement Plan: Consider a married couple, John and Jane, who are both approaching retirement age. They decide to invest in a joint and survivor annuity to secure a steady stream of income during their retirement years. The annuity provides them with monthly payments that continue as long as either one of them is alive. This ensures that both John and Jane have financial security, even if one of them passes away. For example, if John passes away first, Jane will continue receiving the annuity payments until her death, providing her with a stable income. 2. Business Partners Retirement Planning: Two long-time business partners, Laura and Michael, have been running a successful company for decades and are now planning for their retirement. They invest in a joint and survivor annuity to ensure that both of them, or their respective surviving spouses, have a reliable source of income after they retire. This provides financial protection for both partners, as the annuity payments will continue for the lifetime of the surviving partner or their spouse. 3. Retiring Parents and Special Needs Child: Susan and Robert are the parents of a special needs child, Emily. As they grow older and approach retirement, they worry about their ability to provide for Emily’s lifelong financial needs. They decide to purchase a joint and survivor annuity that names Emily as the joint annuitant. This means that the annuity will continue to provide payments for Emily’s lifetime after both Susan and Robert have passed away. The joint and survivor annuity ensures that Emily will have a guaranteed income stream to support her long-term needs.

Frequently Asked Questions(FAQ)

What is a Joint and Survivor Annuity?
A Joint and Survivor Annuity is a type of annuity contract designed to provide income to two individuals, usually spouses. The annuity continues to make payments for as long as either of the two individuals is alive, ensuring income for the surviving spouse upon the death of the first spouse.
How does a Joint and Survivor Annuity work?
When purchasing a Joint and Survivor Annuity, the contract owners decide the percentage of the initial income amount that will be paid to the surviving spouse upon the death of the first spouse (usually between 50% and 100%). The annuity then pays out an income stream, which continues until the second spouse’s death.
What are the benefits of a Joint and Survivor Annuity?
The primary benefit of a Joint and Survivor Annuity is the guaranteed income for both individuals for their entire lives. This can provide financial security and peace of mind, particularly for retirees who want to ensure their spouse is financially secure when they pass away.
What are the drawbacks of a Joint and Survivor Annuity?
One of the main drawbacks is that the initial income payment for a Joint and Survivor Annuity may be lower than that of a single life annuity, as the annuity company assumes a longer payout period due to covering the lifespan of two individuals. Additionally, upon the death of the second spouse, the annuity payments cease, and any remaining account balance does not pass to heirs.
Is a Joint and Survivor Annuity required for married couples?
In some cases, pension plans might require married participants to select a Joint and Survivor Annuity as their payout option to ensure the financial protection of the spouse. However, other options might be available, such as choosing a single life annuity with a life insurance policy to provide for the spouse. It’s important to discuss this with a financial advisor to determine the best option for your situation.
How is the payout affected by the selected percentage for the surviving spouse?
The percentage chosen for the surviving spouse affects the amount the annuity pays once the first spouse has passed away. If a higher percentage is chosen, the initial income payment for the couple may be lower, but the income stream continues at a higher level for the surviving spouse. Conversely, if a lower percentage is chosen, the initial income payment may be higher, but the surviving spouse would receive a lower income stream after the first spouse’s death.
Can a Joint and Survivor Annuity be purchased with other types of annuities?
Yes. Joint and Survivor Annuities can be structured with various types of annuities, such as immediate, deferred, fixed, or variable annuities. The specific terms and features of the annuity depend on your needs and the contract selected.
Can a Joint and Survivor Annuity be altered after it’s been purchased?
Typically, annuity contracts are difficult to change once they’ve been established. However, some annuity providers might offer a “commutation” option allowing policyholders to adjust the income stream. Before purchasing an annuity, it’s crucial to understand the terms, conditions, and options available to ensure it meets your needs now and in the future.

Related Finance Terms

  • Life Annuity
  • Spousal Benefit
  • Survivor Benefit
  • Annuity Payout Options
  • Beneficiary Designation

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