ForeIncome II 5-Year with Income Multiplier review

Yes, for a specific buyer. This is a good annuity for someone who wants guaranteed lifetime income, values principal protection, and likes the idea of a shorter five-year commitment instead of the long surrender schedules most income annuities require. It is less appealing for someone who wants pure accumulation, has no interest in ever activating income, or who can comfortably defer for a decade or more — in that last case, a longer income annuity built around extended deferral may convert the multiplier into more income than this contract's structure allows.

The main reason to buy ForeIncome II 5-Year is to build future protected lifetime income while keeping principal protected and without committing your money for as long as competing income annuities ask. The Income Multiplier is the draw — by crediting 3x your index interest to the withdrawal base during deferral, it gives the income side a faster way to grow than a flat roll-up would in a weak-return year. For a buyer who wants the security of income they cannot outlive but is uneasy about a ten-year lockup, the shorter surrender period is a real and rare advantage.

I think this annuity is best for someone in their late 50s through their 70s who is planning future retirement income, expects to defer withdrawals for at least a few years, and wants a built-in rider rather than relying on annuitizing later. The 45-85 issue-age range is wide, but the multiplier rewards a deferral window, so it fits a pre-retiree or early-retiree better than someone who needs income to start almost immediately. It is less attractive for someone whose main goal is growth, someone who wants the simplest possible annuity, or someone who is confident they will never turn income on — that buyer is paying 1.05% a year for a feature they do not intend to use.

You are not buying stock-market upside. You are buying a lifetime income framework wrapped around a principal-protected annuity, and the engine of that framework is the withdrawal base. Your premium establishes a withdrawal base, and during the deferral years the Income Multiplier credits three times your earned index interest to that base rather than one time. When you eventually activate income, your age and the size of that withdrawal base determine your guaranteed annual payment for life. The account value and the withdrawal base are two separate numbers — the account value is what you could walk away with, while the withdrawal base exists only to calculate lifetime income. That distinction is the whole product, and it is worth understanding before you buy.

The headline feature is the Income Multiplier Benefit, which Forethought builds on its Guaranteed Lifetime Withdrawal Benefit VII and includes automatically. Here is the mechanic. In any year your chosen index strategy earns interest, that interest is credited to your account value once and to your withdrawal base three times during the deferral phase — that is the "3x interest credits" multiplier. The withdrawal base is the figure your lifetime payout is calculated from, so growing it three times faster directly grows your future income. Once you activate income, the multiplier steps down to 1x, meaning credits then apply at the normal single rate. The spec describes this 3x-pre-activation, 1x-post-activation methodology at medium confidence, so confirm the exact crediting rules and any caps on the multiplier with a current rate sheet before relying on a specific projection. The practical point is straightforward: this rider rewards years of good index performance during deferral, and it does nothing for you in a flat year because there is no interest to multiply. Unlike a fixed roll-up that guarantees a set percentage regardless of market behavior, the multiplier is contingent on the index actually earning.

The most meaningful secondary feature is the five-year surrender schedule itself. Income-focused FIAs almost always carry eight-to-ten-year surrender periods because the carrier needs time to support the income guarantee. Forethought offering the same built-in lifetime income rider on a five-year chassis is the unusual part, and for a liquidity-conscious buyer it changes the math. Your money is free of withdrawal charges after year five, which gives you flexibility most income annuities never offer. The honest caution is that the short surrender works against the multiplier's deferral incentive — the contract frees your principal at exactly the point where continuing to defer would keep compounding your withdrawal base. There is also a built-in Income Enhancement Benefit (an Annual Payment Accelerator Rider) that can increase payments under qualifying chronic-illness or care circumstances at no separate charge in the spec, which adds a care-support dimension worth asking about if that risk is on your radar.

This annuity is built for retirement income, not short-term cash, but it is friendlier on liquidity than most income annuities. You can take up to 10% of contract value each year without withdrawal charges — in year one that 10% is measured against premiums paid, and in later years against account value. Anything above that during the surrender period is subject to the charge schedule below, and a market value adjustment may also apply. An MVA — Market Value Adjustment — means the size of your surrender penalty can move with interest rates, so the cost of an early full surrender is not fixed. The relief features are solid. Required minimum distributions are generally accommodated, and there are two waivers worth knowing about: a Nursing Home Waiver that removes withdrawal charges and the MVA after 90-plus consecutive days of confinement, and a Terminal Illness Waiver that does the same after a qualifying diagnosis past the first contract anniversary. After year five, all of this is moot — there are no withdrawal charges. The minimum guaranteed surrender value floor is 87.5% of premiums accumulated at 1-3%.

The cost that matters here is the income rider. The Income Multiplier Benefit charges 1.05% of the withdrawal base annually, and that charge is deducted whether or not you ever activate income. That is the trade: you are paying 1.05% a year to buy the right to a 3x multiplier on index credits and a guaranteed lifetime payout. Whether it is worth it depends almost entirely on whether you actually intend to turn income on and defer long enough for the multiplier to do work — if you do, the math can favor you; if you never activate, you have paid for a guarantee you did not use. The spec does not list a separate base-contract fee. The other tradeoff is structural rather than a line-item fee: index gains are shaped by caps and participation rates, and the current terms reflect that this contract supports income guarantees first. The spec shows a 5.00% cap on the S&P 500 annual point-to-point, 7.35% on the S&P 500 Engel 12% VT, and 7.85% on the Nasdaq-100 Agile 15% strategy, with participation rates ranging from 75% to 140% depending on the index and term, plus a 3.00% fixed account. Those figures are snapshots from the brochure date and at medium confidence in the spec, so ask for a current rate sheet — and remember the multiplier multiplies whatever those strategies actually credit.

Legal Entity: Forethought Life Insurance Company

Parent: Global Atlantic Financial Group