Accumulation Period

Updated: 09 January 2025

What Does Accumulation Period Mean?

The accumulation period, in the context of insurance, refers to the time during which an annuitant contributes money to their annuity account as part of their retirement savings investment. After this phase, the annuitant typically enters the annuitization phase, where they receive regular payouts from the annuity until their death or for a specified period.

Insuranceopedia Explains Accumulation Period

Annuities, an insurance product designed for retirement planning, provide a steady income during one’s later years and help alleviate concerns about outliving assets in retirement. The longer an individual contributes to an annuity, the greater the payouts will be once they begin. Additionally, annuities can be structured in various ways, including the length of the accumulation period, the method of payouts (installments or a lump sum), the duration of payouts, and whether the payouts are fixed (the same amount each time) or variable (dependent on the performance of investments).

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