Annuities
Pays a tax on the interest earned upon surrendering the annuity
annuitant
The monthly benefit of an annuity certain is determined by
annuitant's payout period selection
Type of contract liquidates an estate through recurrent payments
annuity
What is considered to be a characteristic of an immediate annuity
benefit payments start within one payment period of purchase
P, age 50, purchased an annuity that P will fund with $500/ month for 15 years. The annuity will then pay P retirement payments after the 15 years. Which type of annuity did P purchase?
deferred
Start providing income payments after the first year
deferred annuities
N, age 50, recently bought an annuity that will pay a guaranteed $2,000/month at age 70 for life. What type of annuity did N purchase?
fixed deferred
Pays out a fixed amount for life starting at a future date
fixed deferred annuity
Start providing income payments usually starting 30 days from the purchase date
immediate annuities
Has a single premium
immediate annuity
Purchased with single lump-sum payment and will start providing income payments within the first year, but usually start 30 days from purchase date
immediate annuity
W is a 39-year old female who just purchased an annuity to provide income for life starting at age 60. All of these would be acceptable annuity choices EXCEPT a(n)
immediate annuity
Payments are made to an annuitant for life
individual straight life annuity
A husband and wife are receiving annuity payments. When the husband dies, the wife still receives annuity payments for life
joint and survivor life annuity
T has an annuity that guarantees an income payment for the rest of his life. The contract also guarantees that if T dies before receiving payments for 20 years, the remaining payments will be paid to his son for the balance of the 20 years. What type of annuity is this?
life annuity with period certain
Required for a single premium annuity
lump-sum payment
Terry owns a 20 year life annuity certain and dies before the period of 20 years has elapsed. What happens to any monies left
paid to the beneficiary for the rest of the certain period
Kim has purchased a straight life annuity. What will this type of annuity provide her with?
periodic income for life
Kris is receiving annuity payments that has not yet paid an amount which is equal to the purchase price of the annuity. If she were to die, her beneficiary would continue receiving annuity payments until this amount has been received
refund life annuity
S recently received a $500,000 lump sum retirement buyout from her employer. She would like to buy an annuity that will immediately furnish her with a guaranteed income for life. What type of annuity is best suited for her situation?
single premium
The annuity that represents the largest possible monthly payment to an individual annuitant is a(n)
straight life annuity
John is an annuitant who has surrendered his annuity at age 55. What will he pay?
tax on the interest earned
An individual who purchases a life annuity is given protection against
the risk of living longer than expected
Type of annuity that has a cash value that is based upon the performance of it's underlying investment funds
variable