How The PlanGap® Annuity Works

There is no greater example of American Life’s innovation than our partnership with PlanGap® to create the first annuity that has a bonus providing protection against one of the largest fears in retirement planning, the reduction of your Social Security benefits.

Innovative, flexible, peace of mind

No one knows what is going to happen to the Social Security system. What we do know is that a reduction in benefits would cause a serious hardship for many Americans. Our PlanGap® Annuity can help protect the promises that have been made to you and allow you to sleep better at night.

Premium Growth

When you enter into a contract with American Life, you pay an upfront initial premium. In return, American Life grows that initial premium at a fixed, competitively high interest rate for a guaranteed number of years. This provides you with safe, stable and guaranteed returns.

Tax Deferred Interest

The interest earned is tax-deferred during the term, meaning you don’t pay income taxes until you make a withdrawal. At the end of the guarantee period, you can choose to either withdraw your initial premium along with your guaranteed return or continue your PlanGap® Annuity for another five years.

Social Security Protection

If you experience a qualifying government mandated reduction in your Social Security benefits, you will receive a PlanGap® Bonus based upon how long you have held the Annuity. These funds can be withdrawn without penalty to help cover the gap in your retirement income.

The Options and Flexibility You Deserve

You may withdraw up to 10% each year without penalty.*

We provide free withdrawals for customers meeting their IRS-mandated Required Minimum Distribution (RMD) and a Guaranteed Death Benefit that allows a full account withdrawal without penalty in the event of a policyholder’s death.

The PlanGap® Bonus is paid out over five consecutive years and is available once a triggering event takes place.** The bonus amounts can be withdrawn without penalty to ensure your retirement income remains consistent. You even have the option to delay when the payout begins in order to increase the bonus amount you will receive.

* Not available until beginning of second contract year. Withdrawals of interest prior to age 59 ½ may be subject to a 10% Federal income tax penalty. Withdrawals in excess of the 10% free withdrawal may be subject to contract surrender charges (see contract for details).

** A triggering event occurs when a reduction in Social Security benefits exceeds the threshold defined in the Contract Value Enhancement rider, Form ICC20-MYGACVER 001 01/20.