Kim Borwick, Financial Editor for
  • Written By
    Kim Borwick

    Kim Borwick

    Financial Editor

    Kim Borwick is a writer and editor who studies financial literacy and retirement annuities. She has extensive experience with editing educational content and financial topics for

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    Emily Miller, Managing Editor for

    Emily Miller

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  • Updated: May 22, 2023
  • 6 min read time
  • This page features 4 Cited Research Articles
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How to Cite's Article

APA Borwick, K. (2023, May 22). Annuitant. Retrieved June 8, 2023, from

MLA Borwick, Kim. "Annuitant.", 22 May 2023,

Chicago Borwick, Kim. "Annuitant." Last modified May 22, 2023.

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Key Takeaways

  • The annuitant is the person whose life determines the payouts from the annuity — it may be the annuity owner or someone else the owner designates.
  • An annuitant who is not the owner cannot change the annuity contract or beneficiaries of the annuity, only the owner can.
  • If the annuitant is not the owner, they can not make contributions or withdraw money from the annuity.
  • Choosing a younger annuitant than the owner allows the owner to maximize tax deferments and payouts over a longer period of time.

People often mistakenly believe that the owner of an annuity contract is always the annuitant. While it is common for the annuity owner to also be the annuitant, it is not a requirement, and many annuity owners choose to name someone else as the annuitant.

What Is the Difference Between an Annuity Owner and an Annuitant?

The annuity owner is the person who decides the terms of the contract, including the date at which income benefits begin, how long they last and who will be named as the beneficiary. The owner of the annuity is the person who pays the initial premium to the insurance company and has the authority to make withdrawals, change the beneficiaries named in the contract and terminate the annuity.

The annuitant is the person whose life determines the annuity payouts. Insurance companies use a number of factors to calculate the periodic payout from an annuity. The age, sex and life expectancy of the annuitant is a key element in this formula. In the insurance industry, the annuitant is referred to as the “measuring life.”

An annuitant who is not also the annuity owner does not have the authority to change the beneficiaries listed in the annuity contract or make any other amendments to the contract. Furthermore, he or she can’t contribute or withdraw money.

By selecting a younger annuitant, the annuity owner can stretch out the payments and defer the income tax owed on distributions for a longer period of time.

Infographic Describing an Annuitant vs. Owner

Joint Ownership vs. Joint and Survivor Annuity

An annuity owner may also share ownership of the annuity with another person. Jointly owned annuities are similar to annuities owned by a single person in that the death benefit is triggered by the death of one of the owners. This means that although the second owner is still alive, the annuity will pay out the death benefit to the beneficiary.

To avoid this, a better strategy would be for the owner to name the second person as a beneficiary.

Take, for example, a husband and wife with one child. If upon his death, the husband wants his wife to continue to receive income from the annuity for the rest of her life — at which point, they want their child to collect the proceeds — he can designate himself as the owner and annuitant, his wife as the beneficiary, and his child as a contingent beneficiary.

Alternatively, you may consider a joint and survivor annuity to guarantee that payments last for the duration of your life and the life of one other person. This person, usually a spouse, is a second annuitant, not a beneficiary.

Joint and survivor annuities allow the surviving spouse to continue on the existing payment schedule. However, this arrangement will prevent the surviving spouse from taking a lump sum from the annuity should they need it for funeral and burial expenses.

What Is the Difference Between an Annuitant and a Beneficiary?

Beneficiaries make up the third designation of an annuity contract.

Whereas the annuity owner and the annuitant may be the same person, a beneficiary is a separate person or entity. The beneficiary is the person who is entitled to the remaining cash-value of the annuity upon the death of the annuitant or annuitants.

Spouse beneficiaries are permitted to take over as the owner of the annuity, continuing to receive periodic payments and deferring income tax. This is not the case with non-spouse beneficiaries. A fundamental difference between spouse beneficiaries and non-spouse beneficiaries is the manner in which they are required to collect the funds.

Non-spouse beneficiaries have various options for collecting their annuity inheritance:

  • Take a lump-sum distribution.
  • Collect the entire cash-value of the annuity within five years of the annuitant’s death.
  • Annuitize the proceeds.
  • Take an annual required distribution based on his or her own life expectancy.

Note that as of January 1, 2020, the last option is only available for nonqualified annuities, in accordance with the SECURE Act. Most beneficiaries of qualified annuities must withdraw the entire cash value of the annuity within 10 years of the annuitant’s death. They can no longer use the “stretch” provision, which allows withdrawals based on their own life expectancy.

To illustrate the difference between the rights of a spouse beneficiary and a non-spouse beneficiary, let’s assume your uncle named you as the sole beneficiary of his single-life annuity, which had a cash-value of $175,000 at the time of his death. You, as a non-spouse beneficiary, have no ownership rights to the contract.

You are, however, entitled to collect the $175,000 in a series of regular payments or in discretionary withdrawals, which include the entire balance as one lump sum, during the five years after your uncle’s death.

Lastly, a fourth designation that may exist in an annuity contract is the payee. The payee is the person who receives the payments from the annuity.

The payee can be the annuitant (measuring life), the annuity owner or a third party who is authorized to handle the annuity owner’s finances.

The Defense Finance and Accounting Service, for example, allows for a “representative payee” to make pay-related changes on behalf of an annuitant. This payee is appointed by DFAS.

It’s important to understand the differences among these designations — including those between spouse and non-spouse beneficiaries. This will ensure that you structure your annuity contract appropriately. If you have questions about the specific designations, payout options, tax implications or other features, contact a professional advisor for assistance.

Infographic Describing an Annuitant vs. Beneficiary

Frequently Asked Questions About Annuitants

Can the annuitant and beneficiary be the same person?
The annuity beneficiary is the person who receives the annuity’s death benefit. The annuitant is the person whose death triggers the death benefit payout. So, the annuitant and beneficiary cannot be the same person.
Can you change the annuitant on an annuity?
The rules for changing the annuitant vary depending on the company issuing the annuity, the type of annuity involved and state and federal regulations. You should refer to your annuity’s contract for the rules in its particular case.
What is the difference between an annuitant and a retiree?
An annuitant is someone who receives regular payments from an annuity. A retiree includes anyone who has retired from the labor force. A retiree can be an annuitant if they receive money from a retirement annuity or another annuity. But an annuitant is not necessarily a retiree.

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Last Modified: May 22, 2023

4 Cited Research Articles writers adhere to strict sourcing guidelines and use only credible sources of information, including authoritative financial publications, academic organizations, peer-reviewed journals, highly regarded nonprofit organizations, government reports, court records and interviews with qualified experts. You can read more about our commitment to accuracy, fairness and transparency in our editorial guidelines.

  1. Internal Revenue Service. (2022, August 30). Retirement Topics - Qualified Joint and Survivor Annuity. Retrieved from
  2. Internal Revenue Service. (2022, February 28). Publication 575: Pension and Annuity Income. Retrieved from
  3. Defense Finance and Accounting Service. (2020, January 22). Powers of Attorney/Third Party Representatives for Annuitants. Retrieved from
  4. Internal Revenue Service. (2020, January 9). Publication 7004: Employee Benefit Plans. Retrieved from