Home > Retirement > Intermediate
Retirement Intermediate: Variable Annuities

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
When you invest in a variable annuity, your funds go into the insurance company's general account.
Choose wisely. There is only one correct answer.
False. In contrast to a fixed annuity, in which your funds are limited to the general account of the insurance company, variable annuities make available separate account investments in the stock, bond, and/or money markets.
2.
The earnings on variable annuities are taxed during the accumulation period.
Choose wisely. There is only one correct answer.
False. The earnings on variable annuities are tax-deferred until payout.
3.
Which of the following is a benefit of variable annuities?
Choose wisely. There is only one correct answer.
Better potential return. Variable annuities feature neither guaranteed returns nor fixed payments.
4.
A period certain annuity pays income _______.
Choose wisely. There is only one correct answer.
For a fixed term. A period certain annuity pays income for a fixed term, even if the annuitant doesnt survive the term.
5.
Which of the following is not a characteristic investment account available with variable annuities?
Choose wisely. There is only one correct answer.
General account. Stock, bond, and money market accounts are the "characteristic" separate accounts available with variable annuities.