The American Pathway is a single-premium, deferred income fixed annuity product from AIG. Essentially, this annuity allows investors to buy a source future income to help ease uncertainty during retirement. AIG’s American Pathway Deferred Income annuity offers options for payment increase and adjustments for inflation based on CPI (Consumer Price Index).
American Pathway Deferred Income Annuity Facts
Single Premium Contract
This is a single premium contract with an allowable minimum single premium of $20,000 and a maximum allowed single premium of $1,000,000 without prior approval from the company.
Issue Ages
- 0-90 years for non-qualified & Roth IRA contracts (the maximum issue age for lifetime income-only payment options is 85 years)
- 0-69 years for qualified & IRA contracts.
- 0-83 years for QLAC (Qualified Longevity Annuity Contract).
Date of 1st Payment
The minimum deferral period is more than 1 year (12 months), while the maximum deferral period is 30 years. Ordinarily, investors get to choose their 1st payment date when purchasing the annuity product. However, distributions for Roth IRA and nonqualified funds start by the age of 91, while those for qualified and IRA contracts commence by age 70.5. Distributions for QLAC start the first day of the month following an annuitant’s 85th birthday.
The 1st payment date can be accelerated any time within five years of the initial start date so long as it’s in compliance with the stated minimum and maximum deferral periods. This is not available with lifetime income-only payment options, and only if a withdrawal has not been exercised.
Annuitant
- Single Life – payments are provided through the life of one annuitant.
- Joint and Survivor – payments are provided so long as one of the annuitants lives. Payments can remain intact or decrease following the demise of the first/primary annuitant.
- Joint and Contingent – payments are provided so long as either of annuitants is alive, and payments can remain intact/level or decrease following the demise of either annuitant.
Other product features such as the withdrawal benefit might vary depending on the investor’s particular circumstances. When purchasing the American Pathway Deferred Income annuity, or any other deferred or immediate income for that matter, it’s advisable that you contact an annuities specialist who can help you make the right choices.
Potential Benefits
- Varied contract options – investors have a lot of flexibility when it comes to purchasing the annuity. Contracts can be purchased as Roth IRA, qualified, non-qualified, or QLAC (Qualified Longevity Annuity Contract).
- Payment flexibility – the investor can elect who receives annuity payments, with provisions to have payments made to a beneficiary in the event of an early death.
- Commutation withdrawal benefit – if you need access to funds before your scheduled income payments, one-time withdrawals of up to 100% are provided for. However, commutation withdrawal benefits might vary based on circumstances surrounding your investment and are not available in the state of New York (as of now).
