Variable Annuities Calculator


Published on

It is an insurance product that gives long term, tax delayed savings.

Published in: Economy & Finance, Business
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Variable Annuities Calculator

  1. 1. Variable AnnuitiesCalculator - Is Variable Annuity the ProperChoice for My Financial Collection by The Annuity Reporter Variable Annuities Calculator
  2. 2. Now that we have tackled the annuities description, inaddition to the annuities calculator, do you know of its manytypes?For starters, there is the variable annuity. Do you know whatit is, what its for, and how to utilize a variable annuitiescalculator?To start off, variable annuity is a primary type of annuity,along with fixed annuity, immediate annuity, and fixedindexed annuity.It is an insurance product that gives long term, tax delayedsavings.Basically, the annuitant is required to pay a specific amountin premiums, with ranging variable annuity rates, to thecompany, which can either be a one time payment or a flowof payments.In exchange, the company will offer income to the annuitantfrom investments chosen by the annuitant from a set of sub-accounts provided by the company, which involves mutualfunds, stocks, bonds, and money making instruments.This way, the investor can generate a lot of money or canlose a lot of money, depending on the performance of thesub-accounts decided on.Unlike other annuity types, one unique trait of the variableannuity is its likelihood of the best rate of return for theshortest stretch of time. Variable Annuities Calculator
  3. 3. The fact that the investment is directly in the stock market,great advantages usually come with exceptional risks andwith variable annuities, you stand to lose as much money asyou can generate.Much like a fixed annuity, a variable annuity involves twolevels, the accumulation level and the distribution level.The period when the annuitant regularly pays the stipulatedamount of premiums to the company is called theaccumulation stage.With a variable annuity, the investor can designate apercentage of the investment for a particular sub-account.For instance, thirty percent may be allocated to US-basedstocks, forty to international stocks, and the outstandingthirty percent to bond funds.Investors also have the option to steer percentages of theirinvestment to a fixed account. As the name suggests, theinvestor will receive a fixed rate of interest.Meanwhile, the period when the annuitant will begin to getincome is called the distribution level.This income may be given as a lump sum or as a flow ofincomes, ordinarily granted monthly.Investors who opt to obtain several incomes can decide onthe length of the payment period, which can either be a setperiod, 5-year period or 10-year period for instance, or anindefinite period, lifetime income. Variable Annuities Calculator
  4. 4. While the investment increases in the account tax deferred,pulling out the income will make it taxable.Not like fixed annuities or immediate annuities, insurancecompanies dont take a percentage off of the investor’sreturns as their income.Alternatively, investors will be required to pay expenses.Usually, investors have to pay seven distinct types ofexpenses with a variable annuity account.The rates of these costs will fluctuate, based on the investor.Now that you have some standard idea about variableannuity, let us proceed to the application of variable annuitiescalculators, at times referred to as immediate variableannuities calculator and even variable annuities calculatorimmediate.Take note that each type of annuity calculator has differentcounter, chart, and formula.So, a fixed annuity calculator will differ from that of thevariable annuity, with its own variable annuities counter,variable annuities chart, and variable annuities formula.Utilizing a variable annuity calculator is very simple, with themany variable annuities software offered online.By just observing the instructions and inputting the properinformation, you can quickly get the correct results with thesoftware. Variable Annuities Calculator
  5. 5. However, inspite of the ease of use of most online variableannuity calculators, not knowing what to type in can makethe results of the calculations inconclusive and inaccurate.Here are some basic parameters included in a variableannuity calculator.• Current Age - Your current age.• Withdrawal Age - The age when you would like to startobtaining your revenue.• Annual Contribution – The amount you will pay to thecompany every year.• Expected Rate of Return - The yearly rate of return youanticipate for your account. Projecting the rate of return of avariable annuity with guarantee is generally tricky, withmarket unpredictability. When it pertains to long-terminvestments, the more difficult it becomes to predict theactual rate of return.• Current Tax Rate - The rate at which you are expected topay on your current taxed investments. Subject to whichincome tax bracket you fit in with, the rates will differ.• Retirement Tax Rate - The rate at which you aresupposed to pay on your investments during retirement.• Year until Retirement - The number of years before youretire.• Annuity Total before Taxes - The whole balance in yourvariable annuity before tax breaks.• Annuity Total after Taxes - The total amount in yourvariable annuity after tax deductions.• Total Taxable Account - The overall value of your savingsduring retirement, if you place your contributions into ataxable account.• Surrender Charges - Prematurely opting out of your Variable Annuities Calculator
  6. 6. contract would result in the imposition of expenses known assurrender charges.You can easily get the results you need by accordinglyascertaining these parameters and keying in them into anyvariable annuities calculator.This way, you can better understand if a variable annuity isright for you.While variable annuities are normally looked down upon bymany investors, it may actually help your investmentincrease.With sufficient attention and persistence given to explorationand learning the application of a variable annuity calculator, itmay be the suitable inclusion to your portfolio. Variable Annuities Calculator