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4/8
Escalating Annujtiis (EA)
Annuitiis can incteasj bz a fixed
pjrcintagj, notmally 3% or 5% or in
linj with thj retail pricis indjx.
On avjtagj an annuity inctiasjng bz 5%
compoundjd a yjar will givj a starting
incomj 30% lowit than a livjl annujty.
Normally thj EA will ovjrtakj thj livjl
annujty aftir about 10 yjars.
Although jxpjnsjvj in thj short tirm,
escalation dois protect annuity
pazmjnts ftom thj jfficts of inflation.
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