Systematic Withdrawal

Systematic Withdrawal is a method of withdrawing funds from the annuity in specified amounts for a specified payment frequency.  The annuitant is not guaranteed life-long payments.  With the systematic withdrawal schedule, the annuitant chooses instead to withdraw funds from his or her account until it is emptied, bearing the risk that the funds become depleted before he or she dies. The annuitant could also choose to only withdraw interest or a fixed amount each month.

Set Up Systematic Withdrawal

Systemtic Withdrawal Allocations:  The Systematic Withdrawal Allocations must be defined.  This is done from the Allocations link on the Left Navigation menu.

Deferred Annuity segment:  The Deferred Annuity segment must be added to the policy with the Systematic Withdrawal option set to Yes.  A Termination date can be set on the Deferred Annuity Segment if the systematic withdrawals should stop at a specific point in time.  The start date for systematic withdrawals must be at least 30 days after the issue date.  When the policy becomes active, then the Systematic Withdrawal Start activity will automatically display on the Activities screen.    

Change Systematic Withdrawal

If the systematic withdrawal details needs to be changed after the withdrawals have started, process a SystematicWithdrawalChange transaction.  If the withdrawals need to stop before the termination date, process a SystematicWithdrawalStop transaction.  

Processing the Systematic Withdrawal Start activity will spawn a Systematic Withdrawal activity according to the frequency set in the Deferred Annuity segment.  If allocations need to be  redefined, click the Activity Details icon next to the Systematic Withdrawal Start activity and then open the Allocation link.  After the funds have been adjusted, save the information and process the Systematic Withdrawal activity.

Note:  If an error message appears asking for the Deferred Annuity segment Systematic Withdrawal information to be updated, then delete all activities on the policy, go to the Segment screen and delete the Deferred Annuity.  Then add the Deferred Annuity and process the activities over again.