Question

a client has a variable annuity with an assumed interest rate of 4%. the client received a first benefit check of $110. the separate account rate of return between the first and second month was 10%. the client received a second check for $125. what was the actual rate of return of the separate account between the second and third month if the client's third check was also for $125?

Answer 1

4% was the actual rate of return of the separate account between the second and third month if the client's third check was also for $125. A client has a a variable annuity with an assumed interest of 4%.

Regardless of market conditions, an annuity is a financial product that is created and backed by an insurance company and offers guaranteed monthly income payments for the duration of the contract. An annuity can be tailored based on a number of factors, including as how long you anticipate living, the commencement date of your payments, and whether you wish to leave your income stream to a beneficiary after your passing.The fundamental purpose of annuities is to augment more conventional retirement income sources like Social Security and pensions. Tax-deferred growth is one of the common traits. Until you start taking withdrawals or getting recurring payments, you won't have to pay income taxes on the returns from your annuity investments.

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