Plan annuity contracts and CDs

Enter the contract once, in its actual account

Use Accounts & Holdings > Add annuity or Add CD. Income & Benefits opens the same annuity contract. After-tax money outside retirement uses a nonqualified annuity wrapper; an IRA-owned annuity stays in its actual IRA. Select Already owned for a dated statement value, or Proposed purchase for a dated purchase from an accessible source account.

A fixed deferred annuity uses its actual annual rate convention, fees, guarantee end, and withdrawal terms. Account value, quoted cash surrender value, and remaining investment in the contract are separate facts. Updating a statement value does not reset tax investment or the purchase anniversary. A quoted surrender value is a dated observation, not a future charge formula.

Where held is the account that owns the contract. Cash destination is where cash-out proceeds go. For after-tax contracts, select a cash, savings, or brokerage account as the destination. Retirement proceeds stay in the holding retirement account until a separate distribution.

Delete contract removes it from the plan; it does not model surrender or pay proceeds. An insurer account created automatically for that contract is removed when it has no remaining contracts, other holdings, or planning uses. Existing retirement and shared accounts remain. To model a real surrender, enter a dated surrender action or record the completed proceeds and mark the contract Closed.

Purchase date is the original contract start. Statement as-of date belongs to the account value you enter. Guarantee end date ends the fixed-rate term; a CD uses Maturity date. These are different dates for an already-owned contract. Use the date format shown in each field. First payment date is needed only for quoted income or planned annuitization.

For an already-owned contract, expand Starting contract-year facts and enter used/free carry-forward allowances, the latest anniversary value, simple-interest principal when applicable, and gross payments already received. Prior payments reduce a premium-less-payments refund. Generic reserve funding and glide-path reallocations leave accounts containing contracts intact; spending can still use unlocked holdings and permitted contract withdrawals.

Quoted income uses an actual payment quote, first payment date, frequency, covered lives, survivor percentage, period-certain end, and optional premium-less-payments cash refund. Enter the insurer-provided tax-free amount per payment and its source. Investment recovery stops when remaining investment reaches zero. Income-only contracts have zero accessible account value. Do not add a separate income stream for the same contract.

Choose term-end actions and withdrawal access

Choose cash-out, an explicitly entered renewal rate and end date, or conversion to quoted income. Renewal does not assume the old rate continues. Annuitization removes the consumed accessible value before payments begin. Retirement payouts become cash inside their account; a household distribution is separate.

Protect a contract from automatic spending withdrawals, allow only its entered annual free allowance, or permit withdrawals with charges. Enter fixed dollar charges as dollars, or percentage schedules with their calculation base. Unused free allowances carry forward only when selected. Automatic annual spending withdrawals use December 31; household spending and taxes still settle annually. Liquidity conflicts can leave required distributions unmet.

Direct bank CDs can use penalties measured in months of interest, including the base and whether principal may be reduced. Brokered CDs use dated quoted net sale proceeds; bank redemption penalties do not apply. Nonqualified partial annuity withdrawals use earnings first. Full surrender taxes positive net proceeds over investment. Taxable CD interest is recognized annually, including retained interest; bank early-withdrawal penalties receive separate deduction treatment.

A brokered CD sale uses its purchase date to distinguish short-term and long-term capital gain or loss. Sale losses offset modeled capital gains; unused losses carry forward. Mark a completed contract Closed with zero accessible value and record its proceeds in the receiving account. Closing a record does not generate a second payment.

Review cash, tax, and accessible value together

Projection > Annuity and CD projections shows opening and closing value, interest, fees, gross reductions, net cash, charges, taxable income, investment recovered and remaining, and contract estate value. Check that purchases reduce their source once and that quoted income does not leave the same premium accessible. Full nonqualified 1035 exchanges require explicit confirmation and an empty target contract in the same wrapper.

Fixed accrual and insurer-quoted income are supported calculation levels. Variable subaccounts, indexed crediting, withdrawal riders, automated market-value adjustment formulas, historical tax elections, and detailed inherited-contract elections are planned. Roth withdrawals use the model’s simplified tax-free treatment; it does not check qualified-distribution eligibility or every Roth ordering rule. Specialized income-annuity RMD and QLAC valuation are not inferred from accessible value.

A QLAC is not modeled as an IRA-owned contract. Its premium limits, RMD exclusion, required start date, death benefits, and eligibility rules need distinct support; an ordinary quoted-income contract does not establish those results.

Bank deposit protection and insurer guarantees are different. YARCalc does not assess issuer solvency or protection limits. Compare uncertain renewal or payment assumptions in a What-if. Explore an annuity records a purchase intent; enter the actual contract terms before running or comparing that plan.