Full Document, WESTON HOSPITAL 629 Healthcare Way SOMEWHERE, FL 32811 407-555-6541 PATIENT: ALBERTSON, JONAH ACCOUNT/EHR #: ALBEJO001 DATE: 09/15/18 Attending Physician: Renee O. Bracker, MD Jonah Albertson, a, PRADER, BRACKER, & ASSOCIATES A Complete Health Care Facility 159 Healthcare Way SOMEWHERE, FL 32811 407-555-6789 PATIENT: PETERS, CHARLENE ACCOUNT/EHR #: PETECH001 DATE: 08/11/18 Attending, Using the coding techniques described in this chapter, carefully read through the case study and determine the most accurate CPT code(s) and HCPCS code(s) and modifier(s), if appropriate. 59 1/2, If an annuity uses units instead of dollars to determine the value of the policy, then it is a(n) _________ annuity. a commutation b. annuitization C. dollar averaging d. laddering 16. The sum of all the payments to be made during the entire term of the annuity. Which of the following do Fixed and Variable Annuities have in common? Each of these alternatives has its pros and cons. D A variable annuity has each of the following features, EXCEPT: When a variable annuity is in the accumulation phase, the investment units are referred to as accumulation units. Annuity payable for a guaranteed period. Joint Life There is no guarantee you'll get the total amount you accumulate. Annuitization is a financial planning strategy that can provide a guaranteed stream of income for a specific period or life by converting a lump sum payment into an annuity. In most cases the annuitant is also the contract owner. What is a modal value? Annuitization. Answer, Which of the following is true for calculating the future value of multiple cash flows? This gives you an income stream for life, like the Life Only option. It is typically done through the purchase of an annuity from an insurance company. ANNUITIZATION METHOD. Retirement goals and financial situation can also impact the annuitization decision, as individuals may have different needs and goals when it comes to retirement income. If you continue to use this site we will assume that you are happy with it. There is no such thing as an indexed premium. A C Premiums can be paid monthly, quarterly, or semiannually. The preferred payout The right to the cash value that has accumulated in the annuity is called the: Nonforfeiture options are available for deferred annuities. No later than within 1 month Also, you usually get to choose how much of an increase you would like to receive each year. 65 Commutation involves converting a portion of the annuity into a lump sum payment, while surrendering an annuity involves canceling the annuity contract and receiving a lump sum payment. Annuitization options are the ways the owner of an annuity can get paid by the insurance company after the accumulation phase has ended. As with all investments, there are risks and rewards, advantages and disadvantages. All of the following are common factors used to determine premiums for annuities, EXCEPT: The marital status of the annuitant is not a factor in premium determination. Reinvestment EmPower Variable Annuity is a contract between you and Union Security Insurance Company (formerly Fortis Benefits Insurance The most common options are: 1. The most common payout options include a straight life annuity, a joint and survivor annuity, and a period certain annuity. Our work has been directly cited by organizations including Entrepreneur, Business Insider, Investopedia, Forbes, CNBC, and many others. B Deferred fixed, Jill wants to know how much to put into her annuity in order to receive the greatest benefit payment amount. No surrender charge would be applied Advertisement Insuranceopedia Explains Annuitization However, instead of paying a lump sum upfront, the annuitant purchases an immediate annuity with a single premium payment. Adding the period certain will lower the amount of the monthly payments. However, the income is not guaranteed to last through the remainder of the life of the annuitant. WebThe flexible payment is not an annuity payout option. A flat 10% surrender charge would be applied However, bond ladders require active management and may not keep pace with inflation. )Bank loans b. This option is ideal for individuals who want to ensure that their beneficiaries receive a guaranteed income for a set period of time. Life Income Joint and Survivor 50% In some annuity contracts, the company may pay a death benefit to your beneficiary if you die before the income payments start. An immediate annuity would be suitable if she was healthy and stood a good chance of living for many years. All of the following are common modal annuitization payout options EXCEPT. The preferred payout method often becomes the annuitant's source of income after retirement. If the same is true for you, be sure to check that your beneficiary designation is correct, as the annuity can be transferred to your beneficiary Mathematics While annuitization can provide a guaranteed income stream in retirement, it is not the only option for converting retirement savings into income. What is the primary purpose of an annuity? For example, individuals with other retirement income sources may not need to annuitize their annuity. A 1 A Which of the following statements is most correct. B D C Cash (lump sum) where the annuitant receives the value of the annuity in one payment. The surrender charge for the fourth year, Unless an exception applies, a tax penalty is assessed for withdrawals from annuities of tax-deferred earnings prior to age ______. Guaranteed income stream. She would like to provide a guaranteed income stream for twenty years. Life annuity is a payout option that guarantees income that the annuitant cannot outlive. Which of the following is not a true statement about deferred annuities? The exclusion ratio is used to determine which part of the payment will be excluded from income tax liability. The payout option an annuitant chooses can impact their annuitization decision. In this blog post we will discuss how the accumulation period works and what it means for annuity investors. Annuities can be used to shelter assets. Annuity uncertain 4What type of annuity is represented by a deposit of Php10000 that is made at the. Annuity Vs Pension Head To Head Difference Annuity Pensions Finance Literacy. Returns are net of expenses. Cross out commas used incorrectly, using the delete ( YYY ) symbol. The payout option that is selected will determine the duration and amount of the income stream. Those who prioritize security and want a guaranteed income stream may find annuitization appealing. A It is a popular option for retirees who are looking for a reliable source of income to support their retirement lifestyle. D Joint and Survivor Annuity This option can increase the tax burden substantially, as the IRS requires taxes to be paid in the year the money is distributed. Owner, The annuity benefit or payment option requiring the greatest amount of capital per $1,000 of benefit is: A straight life annuity pays the annuitant a fixed income for life. No loss of principal. The surrender charge for the fifth year The annuitization process involves purchasing an annuity, determining the payout rate, choosing a payout option, and receiving regular payments from the insurer. Select Your Subject The correct answer is: Once the payout option is selected, it cannot be changed after payments begin. To have an approved presentation of a variable annuity the prospect must receive which of the following documents? This team of experts helps Finance Strategists maintain the highest level of accuracy and professionalism possible. While the newer versions of variable annuities have riders that will provide a guaranteed income, that is not a standard feature. Inflation will most likely erode Frank's purchasing power over time, making it more difficult for him to meet monthly expenses. . Systematic withdrawals and dividend-paying stocks offer flexibility and potential for growth but with more risk and uncertainty. In order of value, with least valuable assets first. The annuity period is the time during which accumulated money is converted into an income stream. The income options with a single premium immediate annuity are the same as any other type of income annuity. A systematic annuity withdrawal allows the annuitant to choose the dollar amount and number of payments without regard to the duration of the income stream. If you select this option, your payments will be lower than most other payments. However, there is no guarantee that the money will last throughout the lifetime of the retiree, and there is a risk of overspending or outliving their retirement savings. Before age 70 1/2, Annuities are primarily designed to accumulate funds for a(n) _________ fund. A But the option to annuitize can create a real dilemma for annuitants who want to get the most bang for their buck from their contract. View However, dividend payments can fluctuate, and there is no guarantee of returns or income levels. It refers to the time between when an investment is made and when payments are first received. Full Document. Once that number is calculated, it remains constant. There is considerable latitude with non-qualified plans that does not exist with qualified plans. She has funded her plan with after-tax contributions, and she wants to know what her tax liability will be going forward. It is important to consult with a financial advisor to determine the best payout option for the situation of the individual. If the annuitant dies before the payout period is over, the remaining balance may be paid to the beneficiaries of the annuitant. The annuitant makes a lump sum payment to the insurer, and in exchange, the insurer agrees to pay the annuitant a fixed amount of money at regular intervals for a specified period or for life. An annuity where the payments received will start some time in the future as opposed to starting when the annuity is initiated. This can provide a steady stream of income and the potential for capital appreciation. All of the following are TRUE regarding a Variable Annuity, except: All of the following are Payment Options available upon annuitization, except: A(n) ________ has all of the contractual rights in an annuity policy. Seeking help from a financial advisor can help individuals evaluate the advantages and disadvantages of annuitization and determine the best payout option for their situation. As each bond matures, the principal can be reinvested or used for income. The payments continue until you stop them or you run out of money. We follow strict ethical journalism practices, which includes presenting unbiased information and citing reliable, attributed resources. B Annuitization is a financial strategy that involves converting a lump sum payment into a guaranteed stream of income for a specific period or for life. Annuitization is a financial planning strategy that allows individuals to convert a lump sum payment into a guaranteed stream of income for a specific period or for life. All periodic premium annuities are deferred annuities. It may not be appropriate for those needing flexibility or wanting growth in their investments. B The company pays you or your survivor for as long as either of you lives. To find the FV, How are assets typically organized on a balance sheet? Yes, you can split the proceeds of your retirement fund into a living and a guaranteed annuity, or you can buy either two living or two conventional annuities from two different service providers. You can also convert a living annuity into a conventional annuity. Klein Calvin manufactures two types of mens pants: jeans and khakis. As each bond matures, the principal can be reinvested or used for income. College The correct answer is: Accumulation phase. The three most common annuity payout options are annuitization, systematic withdrawal and lump sum distribution. WebThe most common types of annuities that require annuitization include the following: Single premium immediate annuities (SPIAs) Deferred income annuities (DIAs) Qualified The financial needs and goals of an annuitant should be considered when choosing a payout option, and seeking help from a financial advisor is recommended. Immediate annuities allow the annuitant to remove the funds from his/her estate (for Medicaid purposes). WebAnnuitization. Annuitant Periodic While annuitization can be advantageous for retirees looking for a reliable source of income, it may not be suitable for those who need flexibility or who are concerned about the potential loss of principal. Once the payout rate and option have been determined, the annuitant will begin receiving regular payments from the insurer. If the contract owner chooses to surrender the annuity before the payout phase begins or to stop making premium payments, two nonforfeiture options are available: 1. The payout option that is selected will determine the duration and amount of the income stream. Chapter 18/4: Underwriting, Application, Deli, Fundamentals of Financial Management, Concise Edition, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Daniel F Viele, David H Marshall, Wayne W McManus, microbiology self-study 1 - bacterial structu. All Rights Reserved. Once the payout rate and option have been determined, the annuitant will begin receiving regular payments from the insurer. Engineering The correct answer is: A prospectus and an approved illustration. A joint and survivor annuity pays the annuitant a fixed income for life and continues to pay a percentage of the income to the surviving spouse after the annuitant dies. A joint income is primarily a plan for a couple. When choosing a payout option, individuals should consider their financial needs, goals, and personal circumstances. A securities registration (license) is required in order to sell them Dividend-Paying Stocks Limited liquidity. Surrender - the entire amount of premiums paid into the annuity, minus the surrender charges and prior withdrawals, will be refunded in a lump-sum; or 2. The frequency of annuitization varies depending on the annuity contract. Which of the following is TRUE regarding the accumulation period of an annuity. Annuitization involves converting your accumulated retirement assets into a series of periodic payments that last for a period of time of your choosing, in accordance with the provisions of the annuity contract. If the annuitant dies early, much of the value is surrendered to the insurance company. C It may last for the lifetime of the annuitant. The certification names are the trademarks of their respective owners. WebThere are a variety of Annuity Payout Options from which you may choose, including payments for life or for a guaranteed period of years. Immediate indexed In order of liquidity, with least, Which of the following types of financing is typical for a business in its mature stage? While annuitization can provide a guaranteed income stream in retirement, it is not the only option for converting retirement savings into income. The correct answer is: Inflation. B B WebAnnuity payout options Below are some of the most common annuity payouts. WebThis prospectus describes the EmPower Variable Annuity. C WebExpert Answer. No market risk. 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