GLWB products offered by insurers are variable annuities contracts with a special guarantee. This kind of variable annuity contract lets you invest in segregated funds offered in the contract, which are like mutual funds. In general, variable annuities contracts of this kind offer many guarantees such as death guarantees that provide that you will have at least X% of your invested capital when you die.
GLWB is a guarantee that you will be able to make withdrawals (also called surrenders) from the funds in your contract until you die. If your funds run out of money at some point, the insurance company will continue to pay these withdrawals until you die.
The thing is that all these guarantees, while reassuring, are very, very expensive. A GLWB contract could have as high as 4% annual fees if you add everything up. The better the guarantee, the higher the fees. Also, these contracts might come with bad things such as penalties if you withdraw your funds early.
The Mustachian (and rich people in general) approach to investment is to minimize fees as much as possible. That means avoiding these financial products that come with very fancy guarantees and very high fees. It also means avoiding actively managed mutual funds. You should read about analyzing your risk profile and investing in index ETF (see
http://canadiancouchpotato.com/).
However, if you want to do like most people and refuse to learn anything on investment and avoid any investment risk, a GLWB product could be better than the 0,5% interest rate GICs that the nice lady at the bank will offer you.
