Annuities

What best explains the GMWB Rider?

• Any earnings or interest may accumulate tax-free until the money is withdrawn.

• You can receive income payments, no matter how long you live or whether you have collected your original investment plus earnings.

• Tax-preferred retirement accounts, such as IRAs and 401(k)s, there is no limit to the amount of money you can contribute to your annuities.

• The rider that permits you to designate a beneficiary or guarantee a specific payout amount, even if you die early.

An optional rider that ensures a steady stream of retirement income by allowing you to withdraw a specific percentage of funds each year, regardless of market conditions.​

(a)  

If an investor is risk averse then he will purchase which kind of annuity contract?

• Fixed Annuity

• Variable Annuity

• Indexed Annuity

• Hybrid Annuity

You purchase a variable annuity with an initial purchase payment of $500,000. You allocate 30% of that purchase payment to a bond fund, and 70% to a stock fund. Over the following year, the stock fund has a 20% return, and the bond fund has a 10% return. At the end of the year, your account has a value will be (a)   ​

This image explain which type of annuity?

• Fixed annuity

• Variable Annuity

• Indexed Annuity

• Index-Variable Annuity

Company Midland National indexed annuity might pay the investor 80% of the annual increase in the S&P 500, guaranteeing a minimum of 5% per year and a maximum of 15%. So if the index is up 20% in a year, the annuity will pay ___.

• 20

• 16

• 5

• 15

"Earnings or interest may accumulate tax-free until the money is withdrawn"

This statement is best explained by which term?

• Tax Advantages

• Limitless-Contribution

• Probate-Free

• Tax-Deferred

  (a)   allows a buyer to cancel the contract without incurring a surrender charge.​

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• Easy

• Intermediate

• Tough

Which is the correct explanation of Variable Annuity?

• The insurance company promises you a minimum rate of interest and a fixed amount of periodic payments.

• The insurance company credits you with a return that is based on a stock market index

• The insurance company allows you to direct your annuity payments to different investment options, usually mutual funds.

• Your payout may come either as one lump-sum payment or as a series of payments over time.