Is annuity better than SWP for retirement income?

Annuity provides guaranteed lifelong income (better for longevity risk) but the entire payout is taxed at your slab rate. SWP from equity MFs is taxed only on gains (~12.5% LTCG), leaving a growing legacy corpus. For most investors in 30% slab, SWP is more tax-efficient.

What is the typical annuity rate from LIC in India?

LIC Jeevan Akshay and Jeevan Shanti typically offer 5.5-7% annuity rates depending on age and mode (life annuity, joint, with return of purchase price). Rates are lower than FD but guaranteed for life.

What happens to annuity corpus after death?

In a 'life annuity with return of purchase price' variant, the full initial premium is returned to the nominee. In a 'pure life annuity', payouts stop at death with no refund. SWP leaves the entire remaining corpus as inheritance.

Annuity vs SWP Comparator

Compare lifelong annuity payouts against Mutual Fund SWP. Analyze tax efficiency, longevity risk, and legacy corpus.

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Last verified May 2026

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Nature:Calculator platform and is NOT a SEBI-registered Investment Adviser. All calculations are indicative.

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