Misquoted 120% Mid Term Rate
L1: Misquoted 120% Mid Term RateI am working with an agent that quoted a 3.43% (Monthly) 120% Federal Mid Term rate. This was done late December 08. With this he quoted a $1111.00 monthly payout. I signed a Substantially Equal Payments/72t doc and a Pre-59 1/2 Systematic Withdrawals (Fixed Annuity) doc on 2/12/09, stating a 3.43% Mid Term rate and also lowering my monthly payments to $1063.90. He is now coming back and telling me those rate are/were not correct and he has no control because it is dictated by the Feds. No he is coming back and telling me that my monthly payment will be around $930.00 because the Feds again reduced the rate. I think I am being scammed or lied to about these rates and he has never posted the correct rates on any docs. Are there some rules on how these rates must becommunicated of documented on the many docs one must sign to get these going. I think I was given old rates to secure an agreement and then never told the true rate or payment outcomes until it was too late. Am I correct in smelling a rat, dishonesty or some rules/law breaking here?2009-03-17 21:51, By: Jeff, IP: [188.8.131.52]
L2: Misquoted 120% Mid Term Rate>>Am I correct in smelling a rat, dishonesty or some rules/law breaking here?Probably not detecting dishonesty or law breaking – just a little stupidity. I think you are working with someone who has no concept of what he/she is doing.
For a plan with an initial payment made in December 2008, the maximum rate would have been the published rate for October 2008 or3.81%. The publishedrate for December was 3.43%, but that would not apply to distributions beginning12/08 -It would be lookedat by plans starting in January or February 2009.
If that facts are as you state, then I would startby lodging a complaint with either the Broker/Dealer or the Insurance Company (or both)that he/she represents. Clearly he/she shoud not be giving any advice on SEPP plans.
In short, using a rate of 3.43% for a first distribution that occured in December 2008 should be no problem as it was below that maximum possible rate of 3.81%
Historical SEPP Rates: http://72t.net/InterestRates/RatesFor72t.aspx
2009-03-17 22:05, By: Gfw, IP: [184.108.40.206]
L3: Misquoted 120% Mid Term RateWhen did you get your first payment??? If it was in FEB 2009, the 3.43% rate from DEC 2008 would still be valid. If you have not received the first payment yet, the JAN or FEB 2009 rate would now apply– pick the higher one.It may be that you dragged your feet in terms of getting first payment going, and that may now be the problem. KEN2009-03-17 22:21, By: Ken, IP: [220.127.116.11]
L4: Misquoted 120% Mid Term RateKen… really good point – the plan starts with the first distribution and has nothing to do with signing a form. I also re-read the initial post and it sounds like the 1st payment may still have not been made. If yes, then my comments regarding the agent werre totally off base and deservemy apology.
2009-03-17 22:27, By: Gfw, IP: [18.104.22.168]