RISK MANAGEMENT CH.10 ANNUTIES INDIVIDUAL RETIREMENT ACCOUNTS

अब Quizwiz के साथ अपने होमवर्क और परीक्षाओं को एस करें!

What is an immediate annuity?

A fixed annuity hat can be purchased so taht the income payments start immediately

What is an equity indexed annuity?

A fixed deferred annuity that allows the annuity owner to aprticpate in the growh of thestock market

What is a spousal ira?

A married workeris an active participant in the employers retirement plan, but the other spouse is not an active participant

Taxation of individual annuities?

A nonqualified annuity is an annioty that does not mee the Internal Revenue Code requiring benefits

What is an annuity?

A periodic payment that continues for a fixed period or for the duration of a designateds life *Liquidiation of a sum on a fixed schedule*

What is an IRA rollover account?

A tax free distribution of cash orother part from one plan to another, fundsa re rolled over to a special account

What is a flexible premium annuitu?

Allows the annuity owner to vary the premium payments with no requirement that the owner must deposit a caertain amount

What is a flexible premoum annuity?

Allows the annuity owner to vary the premium payments with no requirement that the owner must deposit a specified amount each year

What is a traditional IRA?

An IRA that allows workers to take a tax deducion for partor all of their IRA contribution (Set up with a bank, life insurer)

What is an IRA

An Individual Retirement Accounts that allow workers with taxable compensation to make annual contributions to a retiremnent plan up to certain limits

Annuities for everyone?

Annuities are not for everyone you should purchase a variable annuity if you will need the funds before 59 1/2

What is a longevity insurance?

Because of increased life expectancy more peole are surviivng past 90; so to deal with the risk of exhausting financial asseys there is longevity insurance

What are forms of annuity settlement?

Cash can be withdrawn Life annuity Life annuity with guaranteed income Installment refund option Joint and survivoor annuity Inflation indexed annuity

What is an deferred annuity?

Defers teh income payment until some later date, provides income payments at some future date

What is a deferred annuity?

Defers the income payment until a a later date providing income payments

What are some annuity products?

Fixd Variable Equirt Index**

What are disadvantages of longevity

Heir will lose potential money Funds are locked up Risk of fortune is possible

What is a fixed period settlement option?

I want moeny until I die

What is a fixed amount>

I want this much this time

What aare some fees and expenses associated with variable annuiry?

Investment Manaager Administrative Charges Mortality and expense ratis Surrender charges

What is the difference between annuirt and life insurance?

Its the exact opposite, it provides protection for living too long and exhausting one's savings. Primary purpose is to provide income that cant be outlived

What are the benefits of longevity insurance?

Kicks in when they are likelyy t be exhausted Low cost Pruchased with inglaton

What are different ways to recieve a deferred annuity?

Lump Sum Single Premoum Deferred Flexible premium

What is an unliquidated principal?

Money from annuitants who die before recieiveing all of their moeny

What are some key elements of equity indexed annuity?

Participation Rates Maximum Cap Rates indexing MEthod Guaranteed Minimum Value

What is a straight life annuity?

Paying one perosn until that perosn dies. So, if you only live 2 years after an investment you only get 160, but if you live 30 years than you get 2.4 million

What is a installment refund option?

Payment of a life income to an anniuitant, and if they die before reciveing total income payment, the payment contrinues to the benficiary

What are some characteristics of life annuity?

Payments for life No guaranteed payments forfeiture possible Life income benefit

What is a variable annuity?

Pays a lifetime income varying on the common stock purposes

What is joint and survivor annuity?

Pays benefits based on the lives of 2+ annuitants (husband and wife) payments continue until they both deid

What is a fixed annuity?

Pays perodic income payments that are guaranteed and fixed in amount Credited with interest

Where do payments come from?

Premium payments Interest earnings Unliquidated princpal

What are some basic characteristiccs of a variable annuity?

Premiums are invested in a portfolio of common tocks that will increASE IN VALUE PRIOR TO RETIREMENT

What is an infaltion indexed annuity?

Provides oeriodic payments taht are ajusted for inflation

What is an inflation indexed annuity options?

Provides periodic payments that are adjusted for inflation

What is the payments of straight life annuity

Retur of principle Survivorship benefit

What are the payments of financial annuity

Return of principal Interest

What are some characteristics of financial annuity

Some payments guaranteed to annuitant or beneficiary Reverts to straight life at the end of guarnateed payment

Who is the annuitant?

The person who recieves the periodic payments`

What is annuity with guaranteed payments?

To avoid the insurance people keeping money, you get payments until you meed original payments. You designate a minum time period, or money will go to the spouse

What is a Roth IRA?

Type of IRA that provides substantial tax deductible but investment income is income tax free

What is a guaranteed beneit?

Variable annuities providea guaranteed benefit that protect the principal against loss due to market declines. If they die, the higher of the two will be paid

When is a full income tax deduction of traditional IRA contribution permitted?

Worker who is not an active participant Actively participating in theh employers retirement plan

What is the liquidation period?

he payout period following the accumulation when the funds are paid to the annuitant


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