Automatic Income Adjustment

Abstract

A method includes receiving market data associated with an investment product that specifies a first guaranteed annual withdrawal amount and a second guaranteed annual withdrawal amount, where the first guaranteed annual withdrawal amount is greater than the second guaranteed annual withdrawal amount. The method also includes automatically selecting a guaranteed annual withdrawal amount from the first guaranteed annual withdrawal amount and the second guaranteed annual withdrawal amount based on at least an evaluation of the market data.

What is claimed is: 
     
         1 . A computer-implemented method comprising:
 receiving market data associated with an investment product that specifies a first guaranteed annual withdrawal amount and a second guaranteed annual withdrawal amount, wherein the first guaranteed annual withdrawal amount is greater than the second guaranteed annual withdrawal amount; and   automatically selecting a guaranteed annual withdrawal amount from the first guaranteed annual withdrawal amount and the second guaranteed annual withdrawal amount based on at least an evaluation of the market data.   
     
     
         2 . The computer-implemented method of  claim 1 , wherein the investment product includes a variable annuity contract that includes a guaranteed withdrawal benefit rider, and wherein evaluating the market data includes determining a change in market value between a first time and a second time. 
     
     
         3 . The computer-implemented method of  claim 2 , wherein the guaranteed withdrawal benefit rider includes a guaranteed lifetime withdrawal benefit rider, and wherein the second guaranteed annual withdrawal amount is selected when the change in market value indicates a market decline that exceeds a market decline threshold. 
     
     
         4 . The computer-implemented method of  claim 2 , wherein the guaranteed withdrawal benefit rider defines a waiting period, wherein a withdrawal during the waiting period sets benefits associated with the variable annuity contract to zero until an end of the waiting period, and wherein benefits are re-established at the end of the waiting period based on a contract value at the end of the waiting period. 
     
     
         5 . The computer-implemented method of  claim 2 , wherein the guaranteed withdrawal benefit rider defines a waiting period, and wherein the guaranteed annual withdrawal amount is locked at the second guaranteed annual withdrawal amount in response to a withdrawal during the waiting period. 
     
     
         6 . The computer-implemented method of  claim 2 , further comprising calculating a withdrawal adjustment base (WAB) and a benefit base (BB) associated with the variable annuity contract, wherein the second guaranteed annual withdrawal amount is automatically selected when an account value (AV) associated with the variable annuity contract is less than a percentage of the WAB or the BB, or when the AV associated with the variable annuity contract is zero. 
     
     
         7 . A computer-readable storage medium, comprising instructions that, when executed by a processor, cause the processor to:
 receive market data associated with an investment product that specifies a first guaranteed annual withdrawal amount and a second guaranteed annual withdrawal amount, wherein the first guaranteed annual withdrawal amount is greater than the second guaranteed annual withdrawal amount; and   automatically select a guaranteed annual withdrawal amount from the first guaranteed annual withdrawal amount and the second guaranteed annual withdrawal amount based on at least an evaluation of the market data.   
     
     
         8 . The computer-readable storage medium of  claim 7 , wherein evaluating the market data includes determining a change in market value associated with the investment product between a first time and a second time. 
     
     
         9 . The computer-readable storage medium of  claim 8 , wherein the first guaranteed annual amount is based on a first annual lifetime payment (ALP) percentage, and wherein the second guaranteed annual amount is based on a second ALP percentage. 
     
     
         10 . The computer-readable storage medium of  claim 9 , wherein the first ALP percentage and the second ALP percentage are determined based on an age of an owner of the investment product. 
     
     
         11 . The computer-readable storage medium of  claim 10 , wherein the first ALP percentage is four percent and the second ALP percentage is three percent when the owner is fifty years old, wherein the first ALP percentage is five percent and the second ALP percentage is four percent when the owner is fifty nine years old, wherein the first ALP percentage is six percent and the second ALP percentage is five percent when the owner is sixty five years old, and wherein the first ALP percentage is seven percent and the second ALP percentage is six percent when the owner is eighty years old. 
     
     
         12 . The computer-readable storage medium of  claim 9 , wherein the instructions, when executed by the processor, further cause the processor to:
 automatically select the first guaranteed annual withdrawal amount when the change in market value indicates no market decline or indicates that a market decline does not exceed a market decline threshold;   automatically distribute a first payment to an owner of the investment product at a first payment time, wherein the first payment is limited to the first guaranteed annual withdrawal amount, wherein the investment product includes a variable annuity contract having a guaranteed withdrawal benefit rider; and   adjust one or more contract values associated with the variable annuity contract based on at least the first payment.   
     
     
         13 . The computer-readable storage medium of  claim 9 , wherein the instructions, when executed by the processor, further cause the processor to:
 automatically select the second guaranteed annual withdrawal amount when the change in market value indicates that a market decline exceeds a market decline threshold;   automatically distribute a second payment to an owner of the investment product at a second payment time, wherein the second payment is limited to the second guaranteed annual withdrawal amount, wherein the investment product includes a variable annuity contract having a guaranteed withdrawal benefit rider; and   adjust one or more contract values associated with the variable annuity contract based on at least the second payment.   
     
     
         14 . The computer-readable storage medium of  claim 7 , wherein the investment product includes a variable annuity contract having a guaranteed withdrawal benefit rider. 
     
     
         15 . The computer-readable storage medium of  claim 14 , wherein the guaranteed withdrawal benefit rider includes a guaranteed lifetime withdrawal benefit rider, wherein the guaranteed lifetime withdrawal benefit rider indicates that a fee associated with the variable annuity contract is adjustable and that an adjustment to the fee is declinable, and wherein declining the adjustment to the fee results in removal of one or more rider features, the one or more rider features including an ability to make additional payments, one or more future annual step-ups, an ability to change to a more aggressive investment option, one or more increases to annual lifetime payment (ALP) percentage due to changing age bands, and an option to receive future rider credits. 
     
     
         16 . The computer-readable storage medium of  claim 14 , wherein the guaranteed withdrawal benefit rider includes a guaranteed lifetime withdrawal benefit rider, and wherein the guaranteed lifetime withdrawal benefit rider includes a principal back guarantee (PBG) that extends a remaining benefit to an owner or a beneficiary of the variable annuity contract until the PBG is depleted. 
     
     
         17 . A system, comprising:
 a processor;   an interface configured to receive first market data at a first time, wherein the first market data is associated with an investment product that specifies a first guaranteed annual withdrawal amount and a second guaranteed annual withdrawal amount, wherein the first guaranteed annual withdrawal amount is greater than the second guaranteed annual withdrawal amount; and   a memory device storing instructions that, when executed by the processor, cause the processor to automatically determine a first selected guaranteed annual withdrawal amount from the first guaranteed annual withdrawal amount and the second guaranteed annual withdrawal amount based on at least an evaluation of the first market data.   
     
     
         18 . The system of  claim 17 , wherein the interface is further configured to receive second market data at a second time and wherein the memory device further stores instructions that, when executed by the processor, cause the processor to automatically determine a second selected guaranteed annual withdrawal amount from the first guaranteed annual withdrawal amount and the second guaranteed annual withdrawal amount based on at least an evaluation of the second market data. 
     
     
         19 . The system of  claim 18 , wherein the first guaranteed annual withdrawal amount is based on a first annual lifetime payment (ALP) percentage, wherein the second guaranteed annual withdrawal amount is based on a second ALP percentage, and wherein the first ALP percentage is greater than the second ALP percentage. 
     
     
         20 . The system of  claim 19 , wherein the first ALP percentage is six percent and wherein the second ALP percentage is five percent.