5% Surrender Fee Example

The client must pay a 5% surrender fee, but they can move the money to an account with a 4.5% rate of return. They have 20 years until the money will be needed. Should the client move their funds?

Data Entry


Prompt

Value


# of Years

20


# of Deposits/Year

0


Amount of Deposit

0.00


 

Account 1

Account 2


Name

Current

Proposed


Initial Value

$100,000

$95,000


Interest Rate

3%

4.5%


Bonus Type

No Bonus

No Bonus


Bonus Value

N/A

N/A


Term of Bonus

N/A

N/A


Annual $ Fee

0

0


Annual % Fee

0

0


% Surrender Fee

5%

 


$ Surrender Fee

0

 

Calculations

The Proposed account's value will exceed the Current account value in year 6, and in 20 years will be $26,647 ahead.

 Lump Sum Calculation Example 1