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More practical question is why would a plan fiduciary add an annuity product to a 401k plan for active participants because the cost of the annuity benefits can add 1 % or more to fees which simply reduce the account balance that compounds tax free. Don't need a tax deferred wrapper in a tax deferred plan. Its better for participants to invest in low cost funds with long term investment goals and purchase an annuity if it is needed at retirement instead of having a small amount invested in an annuity contract that will pay a minimal monthly benefit.