Time before income payments begin
Quick Definition: The deferral period is the time between purchasing an annuity and starting income payments. Longer deferral periods allow more growth and result in higher future income. Deferred Income Annuities (DIAs) are specifically designed for long deferral periods of 5-40 years.
The longer you defer income, the higher your eventual payments:
$100,000 premium, male age 60:
→ Start income at 60: $6,500/year
→ Defer to age 65: $7,800/year
→ Defer to age 70: $9,600/year
→ Defer to age 75: $12,200/year
Deferral increases payments through:
Short deferral (1-5 years):
FIAs, RILAs, MYGAs—growth phase before activating income
Medium deferral (5-15 years):
Standard for mid-50s buyers planning retirement income
Long deferral (15+ years):
DIAs—buy in 50s, income starts at 75-85 for longevity insurance
SPIAs have zero deferral—income starts within a year. DIAs defer income for years or decades. FIAs/RILAs give you flexibility to choose when deferral ends.
Longer deferral periods significantly increase future income payments but require not needing the money immediately. Match deferral period to your actual income timeline—don't defer longer than necessary just for higher rates.