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What do you call an annuity where the payment interval is not the same as the interest compounding period?
An annuity where the payment interval differs from the interest compounding period is called a "variable annuity" or more specifically, it can be referred to as an "annuity with unequal payment periods." In this type of annuity, the payments may be made annually, semi-annually, or quarterly, while the interest may be compounded at a different frequency. This discrepancy can affect the total return and the effective interest rate of the annuity.
What else can I help you with?
What does an annuity calculator do?
This type of calculator gives you the annual payment of annuity. If you don`t know what annuity is, then this won't help you out very much. But I hope that it will.
What is monthly interest payment on a 10000 loan for 5 years at 12 percent interest?
The monthly interest is 100.
What is annual interest?
Annual interest is interest that accumulates every year. This is a predetermined percentage that is added to a loan or credit card payment.
What would happen to a monthly payment if the interest rate increased?
Either the monthly payment would have to increase or the period of the loan.
How much interest would you pay on 6000.00 for 24 months at 6 percent?
This depends on the compounding periods, and the payment schedule. Assuming monthly compounding, and 6% per year, so the monthly rate is 0.06/12 = 0.005 {½ of a percent per month}. If you're borrowing for 24 months then paying the whole thing back at the end of 24 months, that's easy: FV = PV*(1+rate)^time, so Future value {FV} = 6000*(1+.005)^24 = 6762.96, so the interest amount is 762.96 If making payments each month, then need to know how much each month. It's a little more complex, then.
What is the interest rate of the annuity formula and how is it calculated?
The interest rate in the annuity formula represents the rate at which your money grows over time. It is calculated by dividing the annual payment by the present value of the annuity, and then adjusting for the number of compounding periods per year.
What is the future value of a 5-year ordinary annuity?
The future value of a 5-year ordinary annuity can be calculated using the formula: ( FV = P \times \frac{(1 + r)^n - 1}{r} ), where ( P ) is the payment per period, ( r ) is the interest rate per period, and ( n ) is the number of periods. This formula accounts for the compounding interest on each payment made at the end of each period. To find the specific future value, you would need to know the payment amount and the interest rate.
What is an amortization home loan?
On a traditional loan the interest is compounding monthly. With amortization the monthly payment is split up equally between the interest and the actual house payment.
How can one find the annuity payment for a given investment?
To find the annuity payment for a given investment, you can use the formula: annuity payment investment amount / present value factor. The present value factor is calculated based on the interest rate and the number of periods the investment will last.
What is the formula for solving for the interest rate (r) of an annuity?
The formula for solving for the interest rate (r) of an annuity is: r left( fracAP right)frac1n - 1 Where: r interest rate A future value of the annuity P periodic payment n number of periods
What is an immediate annuity rate?
An immediate annuity is an annuity that begins making payments to you shortly after you deposit your money. The rate of interest you earn on this depends on age, payment options, and other factors.
Which of the fallowing must be known to compute the interest rate paid from financing an asset purchase with an annuity?
To compute the interest rate paid from financing an asset purchase with an annuity, you must know the total amount financed, the periodic payment amount, and the total number of payment periods. Additionally, the type of annuity (ordinary or due) affects the calculations. With this information, you can use financial formulas or calculators to determine the interest rate.
What does it mean the the next annuity payment will be fully taxable?
If this a payment to you from your annuity then the total amount of the payment being made to you is from the interest you made during the growth of the annuity. Since the interest grew tax-deferred you must pay the taxes owed on that portion when it is removed from the product. It seems that the company is using the LIFO method of distribution which is Last In First Out. This means that any interest added to the product will be paid out first in most cases whereas taxes will be do on that money since you have not already paid taxes on this growth.
How are annuity payments calculated?
Annuity payments are calculated based on factors such as the initial investment amount, interest rate, and length of the annuity. The formula typically used is based on the present value of the annuity formula, which takes into account these factors to determine the regular payment amount.
Is an annuity payment considered income?
Yes, annuity payments are generally considered income for tax purposes. The IRS typically taxes the portion of the annuity payment that represents earnings or interest, while the return of the principal may not be taxed. However, the specific tax treatment can vary based on the type of annuity and individual circumstances. It's advisable to consult a tax professional for personalized guidance.
What is variable annuity?
A Transamerica Variable Annuity is a fixed system of payment, based on a minimum monthly payment, that ensures payment to individuals during and after retirement.
What is the future value of a 900 annuity payment over five years if interest rates are 9 percent?
To calculate the future value of a $900 annuity payment over five years at an interest rate of 9 percent, you can use the future value of an annuity formula: FV = P * [(1 + r)^n - 1] / r, where P is the payment amount, r is the interest rate, and n is the number of periods. Plugging in the values: FV = 900 * [(1 + 0.09)^5 - 1] / 0.09. This results in a future value of approximately $5,162.80.
