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MONTHLY INTEREST INCOME OPTION
To facilitate your discussion with clients interested in a monthly income option from a deferred annuity, we've developed a chart showing approximate monthly income at various annuity interest crediting rates. This may be of interest to your CD clients. These interest income figures are based on 1/12th of the year. Actual monthly interest payouts, however, may be slightly more or slightly less than shown.

Monthly Interest per $100,000
Annualized Interest
Credited RateMonthly Interest(12 x mthly)Credited RateMonthly Interest(12 x mthly)
4.00%327.373928.495.50%447.175366.04
4.05%331.393976.715.55451.145413.63
4.10%335.414024.915.60455.105461.21
4.15%339.424073.105.65459.065508.76
4.20%343.444121.265.70463.025556.29
4.25%347.454169.395.75466.985603.81
4.30%351.464217.515.80470.945651.30
4.35%355.474265.615.85474.905698.77
4.40%359.474313.685.90478.855746.22
4.45%363.484361.745.95482.805793.65
4.50%367.484409.776.00486.765841.06
4.55%371.484457.786.05490.705888.45
4.60%375.484505.776.10494.655935.82
4.65%379.484553.746.15498.605983.17
4.70%383.474601.696.20502.546030.49
4.75%387.474649.626.25506.486077.80
4.80%391.464697.536.30510.426125.09
4.85%395.454745.426.35514.366172.36
4.90%399.444793.286.40518.306219.60
4.95%403.434841.136.45522.246266.83
5.00%407.414888.956.50526.176314.03
5.05%411.404936.75   
5.10%415.384984.53   
5.15%419.365032.29   
5.20%423.345080.03   
5.25%427.315127.75   
5.30%431.295175.45   
5.35%435.265223.13   
5.40%439.235270.79   
5.45%443.205318.42   

The figures above assume a $100,000 Single Premium Deferred Annuity premium on which interest-only payments are made based on an "average month" equivalent to 1/12th of a 365-day year. Actual monthly interest payments, however, will vary depending on the number of days in a given month and where the last business processing day falls within that particular month.

Interest on deferred annuity premiums is compounded daily and credited monthly. Credited of earnings equal to the declared annual interest crediting rate assumes that neither principal nor accumulated interest is withdrawn from the annuity contract at any time during the entire policy year, which runs from one policy anniversary date to the day preceding the subsequent policy date.

Monthly, quarterly, and semi-annual interest-only withdrawals will always result in lower annual earnings than projected based on the declared annual interest-crediting rate.



Last Updated: 9/23/2012 10:05:00 PM