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B)Universal variable life policy. C)III and IV. I. Question #35 of 48Question ID: 606810 C) taxed as ordinary income only to the extent of earnings. Hire Velocity hiring Customer Escalation Agent in Tampa, Florida 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. D)II and III. The owner of a variable annuity has all of the following rights EXCEPT the right to vote: a. for the Board of Trustees b. to change the separate account's investment objective c. for distributing income and capital gains d. for dissolutions of the trust for distributing income and capital gains. If your customer invests in a variable annuity and chooses to annuitize at age 65, which of the following statements are TRUE? The holder of a variable annuity receives the largest monthly payments under which of the following payout options? C) the yield is always higher than bond yields. During payout, distributions will fluctuate due to performance in the separate account. Her agent recommended she choose a variable annuity as a safe haven for the funds. This annuity is nonqualified, which means the client has paid for it with after-tax dollars and has a basis equal to the original $29,000 investment. C) The investor's concerns about taxes. B) the rate of return is determined by the underlying portfolio's value. *A variable annuity is a security and must be registered with the SEC, not FINRA. The separate account is used for both variable life insurance and variable annuity investments. C) II and III. The number of annuity units rises once annuitization begins. The upside was the possibility of higher returns during the accumulation phase and a larger income during the payout phase. C)II and IV. In a variable life annuity with 10-year period certain, a contract holder receives: The downside was that the buyer was exposed to market risk, which could result in losses. The beneficiary is taxed at ordinary income rates during the year the lump sum is received. *Payments from a variable annuity depend on the securities' value in the separate account's underlying investment portfolio. As of March 03, 2023, had a relative dividend yield of % compared to the industry median of %. A passion for serving customers and a personal commitment to following through in a dynamic, fast-paced environment. B)FINRA. Universal variable life policies Question #38 of 48Question ID: 606798 There are two interest rates under fixed annuities. D)Municipal bonds. B) single payment deferred annuity. A joint life with last survivor contract covers multiple annuitants and ceases payments at the death of the last surviving annuitant. The fixed payment that the annuitant receives loses purchasing power over time as a result of inflation. A variable annuity is just a tax-deferred annuity in which you get to choose how the value of the annuity is invested. B) During the accumulation period. A rider or statement of condition that allows a variable life insured to maintain policy coverage after becoming disabled is a benefit known as Which of the following statements regarding variable annuities are TRUE? Lifetime vs. fixed period annuities C) The insurance company. A) two people are covered and payments continue until the second death. What is the taxable consequence of this withdrawal to your client? Portfolio Compliance Risk Analyst Job in Newark, NJ at Prudential Reference: 12.3.3 in the License Exam. When money is deposited into the annuity, it is purchasing accumulation units. A) periodic payment immediate annuity. *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. D)Variable annuity. The beneficiary is taxed at ordinary income rates during the year the lump sum is received. A variable annuity is a long term investment issued by an insurance company that can help you grow your money, take income in retirement and pass on your wealth. For a nonqualified variable annuity, cost basis for the annuitant would use the after-tax dollars contributed. 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. Variable annuities offer the possibility of higher returns and greater income than fixed annuities, but theres also a risk that the account will fall in value. Simple and general annuities problems with solutions Post navigation The growth portion is subject to a 10% penalty. Question #24 of 48Question ID: 606806 Reference: 12.2.1 in the License Exam. B)cost of living. Question #42 of 48Question ID: 606830 Variable annuity Which of the following is characteristic of fixed annuities? The accumulation period of a variable annuity may continue for many years. The number of annuity units is fixed. C) II and IV. The client's investment objectives, tax bracket, investment experience and risk tolerance all align well with a VA recommendation. The value of accumulation and annuity units varies with the investment performance of the separate account. D) Variable annuity. Though there is no beneficiary designation during the annuitization, this is not an issue for this annuitant. Your customer in his early 30s has received a modest inheritance from a relative. Which of the following statements is not true about the characteristics of a trend? 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. Question #26 of 48Question ID: 606811 Reference: 12.1.1 in the License Exam. C)Mortality risk. A) I and III. They are also riddled with fees, which can cut into profits. A)the state banking commission. B) I and II. An individual retirement annuity is an investment vehiclesimilar to an individual retirement accountthat is offered by insurance companies. With regard to a variable annuity, all of the following may vary EXCEPT: B) variable annuities. How to Rollover a Variable Annuity Into an IRA. is required by the Securities Act of 1933. It may be used by nongovernmental . C)the number of annuity units is fixed, and their value remains fixed. Variable annuities should be considered long-term investments due to the limitations on withdrawals. If this client is in the payout phase, how would his April payment compare to his March payment? Round to the nearest hundredth of a percentile. A)Purchasing power risk. IBM Noida, Uttar Pradesh, India1 month agoBe among the first 25 applicantsSee who IBM has hired for this roleNo longer accepting applications. A variable annuity is a security and must be registered with the SEC, not FINRA. B)fixed in value until the holder retires. C)annuity units. An ordinary simple annuity has the following characteristics: For example, most car loans are ordinary simple annuities where payments are. All of the following are characteristics of variable annuity contracts Fixed annuities typically earn at a lower, stable rate. Variable annuities gave buyers a chance to benefit from rising markets by investing in a menu of mutual funds offered by the insurer. An investor who purchases a fixed annuity contract assumes purchasing-power risk. *The customer, in the accumulation stage of the annuity, is holding accumulation units. do not have a separate account A)It will stay the same. All of the following statements about variable annuities are true EXCEPT: An immediate annuity is designed to pay an income one time-period after the immediate annuity is bought. A) The fact that the annuity payment may increase or decrease. This would not align with the couple's criteria for coverage as long as they both live. C)III and IV B) I and II. Variable Annuities Flashcards | Quizlet The $30,000 contract value represents $10,000 of contributions and $20,000 of earnings. B)I and III. Solved The following are characteristics of a public | Chegg.com B) prime rate. FINRA. Payments from a variable annuity depend on the securities' value in the separate account's underlying investment portfolio. B) be paid to any legal heirs as recognized by the annuitant's state of domicile. C) IRAs. B) 0. None of the other investments listed here offer tax-deferred growth. Upon John's death during the accumulation period, Sue takes a lump-sum payment. must be filed with FINRA. Reference: 12.3.3 in the License Exam. Which of the following is not a characteristic of a program module? C) Unit refund life option Variable annuity salespeople must register with all of the following EXCEPT: Which of the following are defined as securities? The tax on this is $2,800 ($10,000 x 28%). Annuities are complicated products, so that may be easier said than done. vote for the investment adviser. B) value of annuity units. Often used for retirement planning purposes, it is meant to provide a regular (monthly, quarterly, annual) income stream, starting at some point in the future. Classifying annuities There are many categories of annuities. Travel Times Journal found that the average per person cost of a 10-day trip along the Pacific coast, per person, is $1,015. must precede every sales presentation. C)suitable due to the death benefit features of a variable annuity. All of the following statements concerning a variable annuity are correct EXCEPT: C)none of these. B) the state insurance department. withdraw funds without any tax consequences. A joint-and-last-survivor annuity is a payout option where: C) be returned to the separate account. *A variable annuity does not guarantee an earnings rate because earnings will depend on the performance of the separate account. regulated under both securities and insurance laws. C)such an annuity is designed to combat inflation risk. Nicks Enterprises has purchased a new machine tool that will allow the company to improve the efficiency of its operations. Question #12 of 48Question ID: 606814 All of the following are characteristics of a variable annuity, except What Are the Risks of Annuities in a Recession? B) It will be lower. Most annuities will not allow you to withdraw additional funds from the account once the payout phase has begun. Distributions from nonqualified variable annuities are: These contracts cover both lives and will continue to make payments until the last spouse dies. The number of variable annuity accumulation units can rise during the accumulation period when additional units are being purchased.