ALDA vs. deferred annuity

CFA Level III Portfolio Management
#1

Hi,

Do you guys know what the difference between advanced life deferred annuity and a regular deferred annuity is? In my opinion, both have payments to the insured that start at some point in the future. So, what is the difference? Is it about the timing of the lump sum payment?

Thanks.

#2

[original post removed]

#3

In a deferred annuity, contributions are made during working life unlike immediate annuity where contributions are made on retirement. regual annuities receipt (fixed or variable) are received immediately after retirement. advanced annuities are received long after retirement (say from age 85 to death) purpose more to prevent longevity risk. my view

#4

Ok, that sounds reasonable. It would certainly explain why ALDA are the cheapest option.

Thanks.