a variable annuity has which of the following characteristics

a variable annuity has which of the following characteristics

They can be classified by: Nature of the underlying investment - fixed or variable A)the yield is always higher than mortgage yields. If the contract holder dies before the period expires, the remaining payments are made to the beneficiary. While variable annuities have greater potential for earnings, since their interest rate rises and falls with their underlying investments, they can lose money. Because they have a separate account in which the investor assumes the investment risk, they can only be sold by individuals with both insurance and securities licenses. B) Corporate debt securities Annuities basics | III Sample problems from Chapter 9 . Annuities | FINRA.org U.S. Securities and Exchange Commission. C) The ordinary income on the proceeds over the cost basis plus 10% of the net gain (if any) if Sue is younger than 59- years old. A) I and III. D) each annuity unit's value varies with time, but the number of annuity units is fixed. If a 42-year-old customer has been depositing money in a variable annuity for 5 years, and he plans to stop investing but has no intention of withdrawing any funds for at least 20 years, he is holding: Question #36 of 48Question ID: 606805 A registered representative recommends a variable annuity with an income rider to a client. The offers that appear in this table are from partnerships from which Investopedia receives compensation. C) insurance companies keep variable annuity funds in separate accounts from other insurance products. Question #26 of 48Question ID: 606811 Variable annuities grow tax-deferred, so you dont have to pay taxes on any investment gains until you begin receiving income or make a withdrawal. Your customer, still working, informs you that she will be funding a variable annuity you have recommended from 2 sources: a refinancing of her primary home where she will be able to draw out equity that has built up since it was purchased 15 years ago, and cashing out another variable annuity that she recently purchased within the past 2 years without a lifetime income rider like the one you have recommended. A) an accounting measure used to determine payments to the owner of the variable annuity. The fixed annuities, indexed annuities, and variable annuities are some of the major types of annuities, of which one may find immediate annuities and deferred annuities. MetLife, Inc. Senior Customer Care Advocate Annuities ($22 per hour Question #29 of 48Question ID: 606831 A) The entire amount is taxed as ordinary income, because it is not life insurance. LESSON 7: ANNUITIES - FIXED AND VARIABLE - course.uceusa.com Many variable annuities invest the separate account in mutual funds. Clusters of vesicles in various stages. Both products typically have a wide range of options across equities, bonds and money market instruments. A) Dow Jones Industrial Average. C)III and IV *The investor has already paid tax on the contributions but the earnings have grown tax-deferred. C)I and IV. In this case, the investor is taking a lump-sum distribution before reaching age 59- and must pay an additional 10% penalty on the taxable amount. A customer has contributed $1,000 a year for 10 years to his tax-deferred nonqualified variable annuity. The separate account performance compared to last month's performance. Investopedia requires writers to use primary sources to support their work. Determine the revenue equation given the profit and expense equations. Generally, a life-only contract pays the most per month because payments cease at the annuitant's death. A) Capital gains taxation on the earnings withdrawn in excess of the owner's basis. At the end of the year your account has a value of 10750. A) A variable annuity B) Exchange traded Funds (ETFs) or Exchange traded Notes (ETNs) The entire amount is taxed as ordinary income. Your customer is interested in a variable annuity but is unclear on some of the details regarding different specifications and riders that can be attached to the contract. A trend is formed from non-repetitive actions of people. D) Variable annuity. C)Variable annuity contract with a discussion regarding interest rate risk Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Eric W. Noreen, Peter C. Brewer, Ray H Garrison. C) IRAs. Distribution of dividends occurs during the accumulation period. Reference: 12.3.1 in the License Exam. A) mortality guarantee. C)the yield is always higher than bond yields. The growth portion is taxed as ordinary income. A Variable Annuity Has Which of the Following Characteristics savingsbonds30,420Groupinsurance45,630$341,718\begin{array}{lrlr} Question #38 of 48Question ID: 606798 A) taxed at a reduced rate. must be filed with FINRA. MetLife offers a comprehensive benefits program, including healthcare benefits, life insurance, retirement benefits, parental leave, legal plan services and paid time off. A) A 75 year old women, who is a former executive retired for over ten years who wants to preserve as much capital as she can to leave to her two grandchildren. A universal variable life policy should be purchased primarily for its insurance features, not its investment features. The number of annuity units is fixed at the time of annuitization. D) The fact that periodic payments into the contract may increase or decrease. The tax on this is $2,800 ($10,000 x 28%). However, the web version (cat. A universal variable life policy should be purchased primarily for its insurance features, not its investment features. The nature of the securities invested in-bonds and growth stocks-makes it necessary that sales representatives and their principals be licensed in securities as well as insurance. The value of an annuity unit varies from month to month according to the performance of the separate account in comparison to the assumed interest rate. The trial of the assassins commenced on the following day; and the evidence being so clear, they were both found guilty, and condemned, to be broken alive on the wheel. D)Variable annuity contract with a discussion regarding legislative risk, A VA with its investments in the separate account subject to market risk would not align with the customer's objective. But again, the need to designate beneficiaries is not an issue for this annuitant. C)the SEC. C)municipal bonds. The second phase is triggered when the annuity owner asks the insurer to start the flow of income, often referred to as the payout phase. The return on a variable annuity is not guaranteed; it is determined by the underlying portfolio's value. Which of the following recommendations would best meet the customer profile? Question #27 of 48Question ID: 606818 A client has purchased a nonqualified variable annuity from a commercial insurance company. What Are the Risks of Annuities in a Recession? The growth portion is taxed as a capital gain. Once a customer annuitizes a variable annuity, which of the following statements are TRUE? The number of variable annuity accumulation units can rise during the accumulation period when additional units are being purchased. *Contributions to a nonqualified variable annuity are not tax deductible. The remainder of the premium is invested in the separate account. Reference: 12.1.2 in the License Exam, Question #39 of 48Question ID: 721469 An annuity is an agreement for one person or organization to pay another a series of payments. Because they have a separate account in which the investor assumes the investment risk, they can only be sold by individuals with both insurance and securities licenses. A life with period certain contract guarantees payments for a specified number of years to a named beneficiary if the annuitant dies during that time. B)I and II D) Life annuity with 10-year period certain. A) periodic payment immediate annuity. Bear in mind that between the numerous feessuch as investment management fees,mortality fees, and administrative feesand charges for any additional riders, a variable annuitysexpenses can quickly add up. Though its stated return might not be as high as the other choices potential returns, only a fixed annuity fits the objective and risk averse traits of this client. A) I and III. D)0. a variable annuity has which of the following characteristics If the customer takes a withdrawal of $10,000, what are the tax consequences? Immediate annuities purchase annuity units directly. Get the free Learn About Annuities and Their Myths - F&G C) Life annuity with period certain. A) Any tax due is deferred. 8 annuities provide a guaranteed rate of return, whereas annuities provide conservative to aggressive investments whose rates of return are not guaranteed. Diagnosis is made by punch biopsy. FINRA. B)fixed in value until the holder retires. Reference: 12.3.4 in the License Exam. C) suitable regardless of funding sources For an insurance company, mortality risk turns out unfavorably if: B)mutual fund units. A)equity funds. Reference: 12.1.2 in the License Exam. IBM Noida, Uttar Pradesh, India1 month agoBe among the first 25 applicantsSee who IBM has hired for this roleNo longer accepting applications. D)II and III. \end{array} A) 2800. D)II and III. A) defined contribution plans. If an insurance holder dies sooner than expected, the insurance company will have to pay the death benefit sooner. C)not suitable because a lifetime income rider is only for someone who is already retired D) Variable Annuity. An accumulation unit in a variable annuity contract is: A)an accounting measure used to determine the contract owner's interest in the separate account. Paraplanner / Marketing Support Specialist Job in Austin, TX Based only on these facts, the variable annuity recommendation is Deal with mathematic Math is all about solving equations and finding the right answer. C) 100% tax free. Life income riders are best suited for those who anticipate a lengthy retirement and are generally not yet retired when making the VA purchase. A)II and III Distributions to the annuitant will fluctuate during the payout period. B) The death benefit cannot ever be more than the guaranteed benefit. B) II and III. Reference: 12.1.4 in the License Exam. A) number of annuity units. A) Ordinary income tax on earnings exceeding basis. Sub accounts and mutual funds are conceptually identical, but sub accounts don't have ticker symbols that investors can easily type into a fund tracker for research purposes. A variable annuity is a security and must be registered with the SEC, not FINRA. A)III and IV. D) Variable annuities. Reference: 12.1.2.1.1 in the License Exam. D)money market funds. B) During the accumulation period. A) I and III. The growth portion is taxed as ordinary income. B. All of the following statements about variable annuities are true EXCEPT: D)variable annuities offer the investor protection against capital loss. B)I and III. C) with guaranteed minimum withdrawal benefits (GMWBs) a lifetime of periodic payments is guaranteed Herpes Zoster has all of the following characteristics except: For example, if the income is monthly, the first payment comes one month after the immediate annuity is bought. D)accumulation units. You can learn more about the standards we follow in producing accurate, unbiased content in our. He makes several statements regarding the contract. He originally invested $29,000 4 years ago; it now has a value of $39,000. Try *When money is deposited into the annuity, it is purchasing accumulation units. B)Capital gains taxation on the earnings withdrawn in excess of the owner's basis. D)with guaranteed minimum withdrawal benefits (GMWBs) a lifetime of periodic payments is guaranteed, With guaranteed minimum withdrawal benefits (GMWBs) a lifetime of periodic payments is not guaranteed because payments stop when the annuitant has received an amount equal to the principal account value or the contract term ends. This guideline has been prepared for use by Federal agencies. D) A 50 year old individual with $50,000 cash to invest who has already made the maximum contributions to an IRA and the 401(k) plan at his place of employment and would like to minimize some of the tax consequences of his currently high tax bracket. When the second party dies, all payments cease. He makes the following four statements, all of which are true EXCEPT Consequently, the client pays taxes only on the growth portion of the withdrawal ($10,000). B) The investor's marital status. A)variable annuities may only be sold by registered representatives. That can adversely affect your returns over the long term, compared with other types of investments. A customer is receiving annuitized payments from a variable annuity. Assuming that the payroll for the last week of the year is to be paid on January 444 of the following fiscal year, journalize the following entries: Fixed annuities typically earn at a lower, stable rate. What Are the Biggest Disadvantages of Annuities? D) tax free. C) 10% penalty plus payment of ordinary income tax on all funds withdrawn exceeding basis. D)A 10% penalty plus the payment of ordinary income tax on funds withdrawn in excess of the owner's basis. D) 100% tax deferred. C) II and IV. P=525p2+65,326p185,000E=326p+185,000P=-525 p^{2}+65,326 p-185,000 \quad E=-326 p+185,000P=525p2+65,326p185,000E=326p+185,000. B)variable annuities are classified as insurance products. D) a variable annuity contract is subject to fluctuating values due to market fluctuations of the underlying separate accounts. **Because common stocks are not fixed dollar investments, they have the opportunity to keep pace with inflation. Her intent was to use the funds for the down payment on a house after graduation. A) a minimum rate of return is guaranteed. C) II and III. With a fixed annuity, by contrast, the insurance company assumes the risk of delivering whatever return it has promised. 6102.0.55.001 - Labour Statistics: Concepts, Sources and Methods, Dec 2005 Reference: 12.3.1 in the License Exam. must be filed with FINRA. A) II and III. All of the following are characteristics of variable annuity contracts

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