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How are rate of returns (ror), annuitization rates, and withdrawal rates used within segments?



  • Rachel Fox

    For each segment there are two rates that could be used.

    During a segments investment period (the period in which income is being deferred). The "Rate of Return" field is used to calculate the accumulation of that segment.

    Once a segment moves into an income mode the "Annuitization/Withdrawal Rate" is used to determine the rate the segment continues to earns while it is in an income mode.


  • Frank Dunaway

    This is one of the complicated issues with the Products we are using in today's market!!!  There are several moving Parts: Bonus, Roll-Up Rate on the Income Rider, and the Income Payout rate for Income from one of the particular Segments of our Plan.  This is where the Product Analysis of our recommendation becomes particularly critical; many times the Bonus and the Roll-Up factor are very deceptive.  The Income Factor in the end seems to be the most significant variable to be considered when making our recommendation to the Client.  I think the Roll-Up rate & the Income Factor are the critical Rates to be used in our Model.  FSD


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