---
title: "What Is Accumulation Phase? Definition | Epic Life Glossary"
description: "The accumulation phase is the period in a deferred annuity when the owner adds money and the value grows, before income payments begin. It ends when the..."
url: https://epicline.preview.multisites.ai/glossary/accumulation-phase
publisher: Epic Life Group
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---

Annuity terms

# Accumulation Phase

The accumulation phase is the period in a deferred annuity when the owner adds money and the value grows, before income payments begin. It ends when the owner takes withdrawals or starts annuity payments.

## Why it matters

During accumulation, earnings grow tax deferred, which means taxes are due when money is withdrawn. The length depends on the owner's goals and the contract terms. A surrender period may overlap this phase. When the phase ends, the owner can annuitize, take withdrawals, or move to another contract. Withdrawals before age 59 and a half may bring a federal tax penalty. Rules on contributions and options vary by carrier and contract type.

Source: [investor.gov](https://www.investor.gov/introduction-investing/investing-basics/glossary/accumulation-phase)

[Read next, for familiesAnnuities explained: fixed, fixed-index, MYGA, income riders and surrender charges](https://epicline.preview.multisites.ai/annuities)

## Where we use this term

-   [Fixed vs fixed index annuity: how do they work and who do they fit?](https://epicline.preview.multisites.ai/guides/fixed-vs-fixed-index-annuity)

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