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Annuity Fees and Expenses: What You're Actually Paying For

Not all annuities charge the same fees. Here's a breakdown of common annuity costs and how to ask about them clearly.

6 min readReviewed for the 2026 plan year

Base Contract Costs

Some annuity types — particularly many fixed and fixed indexed annuities — do not charge an explicit annual contract fee; the insurer's compensation is instead built into the crediting rate, cap, or spread offered.

Optional Rider Fees

Optional features like a guaranteed lifetime withdrawal benefit (GLWB) rider or an enhanced death benefit rider typically carry an additional annual fee, often expressed as a percentage of the contract's benefit base.

Questions to Ask About Fees

  • Is there an annual contract fee, and if so, how much?
  • What do any optional riders cost, and are they mandatory or elective?
  • How are fees deducted — from contract value, or from a separate benefit base?

Key Takeaways

  • Fee structures vary significantly by annuity type and by carrier — never assume one product's fee structure applies to another.
  • Optional riders typically carry additional fees beyond the base contract.
  • Always request a full, itemized fee disclosure before purchasing.

Fees and expenses vary by carrier, product, and elected riders. This is general education, not a complete fee schedule for any specific annuity. Request the product's full disclosure documents before purchasing.

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