Glossary

Systematic drawdown is a decumulation strategy in which an individual withdraws income from a self-managed investment portfolio according to a predetermined rule, without converting any portion of the portfolio into a pooled or insured lifetime income arrangement. Why it matters Systematic drawdown is the most common decumulation approach in DC plans, and it is the strategy class within which safe withdrawal rate rules, percentage-of-balance rules, and dynamic withdrawal approache

Systematic withdrawal is a drawdown strategy in which the contract owner takes periodic distributions from an annuity contract's account value, on a schedule and in amounts the owner controls, without annuitizing the contract. Why it matters Systematic withdrawal preserves access to the underlying account value, in contrast to annuitization, which converts the capital irrevocably into a contractual income stream. The structural tradeoff is that systematic withdrawal offers no life

Ordinary income treatment is the tax characterization under which the taxable portion of an annuity distribution is taxed at the contract owner's marginal ordinary income tax rates rather than at preferential long-term capital gains rates. Why it matters Ordinary income treatment is the rule that governs how the taxable portion of an annuity distribution is taxed, and it is independent of how those gains were generated inside the contract — whether through fixed interest, index cr