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LINCOLN OPTICHOICESM FIXED INDEXED ANNUITY



Payment Options

With Lincoln OptiChoiceSM, when you are ready to begin taking income payments, you have a number of choices, listed below under "Income Options." In addition, if you die before you elect an annuity payment option (annuitize the contract), your beneficiaries will receive a death benefit payment (see below under "Death Benefit" for details).

Income Options - Annuitization

When you are ready to retire and begin receiving an income stream from your annuity, you may choose from a number of different annuity payment options, including the following:

Income for a Fixed Period Lincoln pays you income for the number of years you select (minimum 5 years).
     
Life Income Lincoln pays you income for as long as you live, or for as long as you and your spouse both live.
     
Interest Only Lincoln pays interest on your total annuity proceeds during a specified period of time, after which you may receive your annuity proceeds plus interest, or choose another payment option.
     
Income of a Fixed Amount Lincoln pays you income payments of an amount that you select until your annuity proceeds and interest are exhausted (minimum 5 year payment period).


Annuitization is irrevocable; once chosen, it is not possible to stop and start the income payments. Annuitization offers a unique tax treatment - income payments from non-qualified contracts are taxed partly as ordinary income, and partly tax-free as a return of basis.

The Life Income option offers an income stream that you cannot outlive.

Withdrawals

Taking a withdrawal as permitted under the contract provisions offers another method of taking income that offers a bit more flexibility and control. Withdrawals can be taken as needed, or not at all. Up to 10% of the contract's accumulation value can be taken surrender charge-free and Market Value Adjustment-free during the surrender charge period. Withdrawals in excess of this amount may be subject to a contract charge. Withdrawals from non-qualified contracts are taxed as earnings first at ordinary income tax rates.

Note:  New York contracts do not have the Market Value Adjustment provision.

Withdrawals taken prior to age 59 1/2  may be subject to an additional 10% federal tax penalty on the amount considered gain in the contract.

Guaranteed Lifetime Withdrawal Benefit Rider (Not Available in New York)

The optional Guaranteed Lifetime Withdrawal Benefit Rider is available for a cost, and offers the opportunity for lifetime income and includes flexibility to start and stop payments. This feature offers a guaranteed withdrawal amount, based on a payment percentage which is determined by your age at the first withdrawal and the number of years you have held the rider. The payment percentage is higher for older ages.

This Rider can help you plan for your retirement income needs. Contact your representative for more information, including information on how the Rider works with the other contract features, specifically the 10% Free Partial Surrender feature.

Death Benefit

If you die before you annuitize your contract, Lincoln will pay your beneficiary a death benefit payment made up of the greater of the following:

  • The annuity contract value; or
  • The guaranteed minimum value.

For New York contracts, the death benefit is equal to the annuity contract value.

The death benefit is paid directly to the contract beneficiary, which avoids the possible delays of probate. The death benefit is subject to any applicable taxes.

Important Disclosures. Please Read.

All features may not be available in all states.

Taxes are due upon withdrawal, and if withdrawn before age 59 1/2, may be subject to a 10% IRS penalty. There is no additional tax deferral benefit for contracts purchased in an IRA or other tax-qualified plan, since these are already afforded tax-deferred status. Therefore, an annuity should only be purchased in an IRA or qualified plan if the client values some of the other features of the annuity.

Lincoln OptiChoiceSM flexible premium deferred annuity (contract form 05-606, or state variation) is a fixed indexed annuity issued by The Lincoln National Life Insurance Company, Fort Wayne, IN, and distributed by Lincoln Financial Distributors, Inc., a broker/dealer, and may not be available in all states (may be referred to as "equity indexed annuity" in certain states). The Lincoln National Life Insurance Company does not solicit business in the state of New York, nor is it authorized to do so. Contractual obligations are backed by the claims-paying ability of The Lincoln National Life Insurance Company. The contract may be subject to a Market Value Adjustment.

Lincoln OptiChoiceSM NY flexible premium deferred annuity (contract form 05-606LNY1) is a fixed indexed annuity issued by Lincoln Life & Annuity Company of New York, Syracuse, NY, and distributed by Lincoln Financial Distributors, Inc., a broker/dealer, and is only available in New York. Contractual obligations are backed by the claims-paying ability of Lincoln Life & Annuity Company of New York.

Waiver of surrender charges for Nursing Home Confinement Rider and Waiver of Surrender Charges for Terminal Illness Rider (form AE-119 and form AE-170, respectively, or state variation) may not be available in all states. The Guaranteed Lifetime Withdrawal Benefit (GLWB) Rider (Form AE-217 or Form AE-245 and state variations) are not available within all Lincoln fixed indexed annuities. Subject to rider issue age limits, which may differ from the issue age limits of the fixed indexed annuity product. May not be available in all states. Limitations and exclusions may apply.

The exact terms of the annuity are contained in the contracts and any attached riders, which will control The Lincoln National Life Insurance company's contractual obligations. For complete information about the annuity, please also read the Disclosure Statement and Facts-At-A-Glance, or contact your Lincoln National Life Insurance Company representative.

This material was prepared to support the promotion and marketing of an insurance product. Neither the insurance company, its distributors, nor their respective employees and representatives provide tax, accounting, or legal advice. Any tax statements contained herein are not intended or written to be used, and cannot be used, for the purpose of avoiding U.S. federal, state, or local tax penalties. Clients should consult their own independent advisor as to any tax, accounting, or legal statements made herein.

Not a deposit.

May go down in value.

Not FDIC-insured - Not insured by any federal agency.

Not guaranteed by any bank or savings association.

LCN:201105-2055097

Hello future.
Lincoln Financial Group is the marketing name for Lincoln National Corporation and insurance
company affiliates, including The Lincoln National Life Insurance Company, Fort Wayne, IN,
and in New York, Lincoln Life & Annuity Company of New York, Syracuse, NY. Variable products
distributed by broker/dealer-affiliate Lincoln Financial Distributors, Inc., Radnor, PA. Securities
and investment advisory services offered through other affiliates. Explore Lincoln.



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