Glossary

Vesting

Also called vesting age.

The date a deferred pension converts from accumulation into income.

Vesting is the point at which a deferred annuity stops accumulating and starts paying. The policyholder usually chooses it in advance, within limits the product sets.

What happens at vesting — how much may be taken as a lump sum and how much must become income — is set out in the policy.

Related terms

  • Deferred annuity An annuity where payments begin at a chosen future date rather than immediately.
  • Annuity A contract that converts a lump sum into an income, paid for life or for a set period.

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