The Allocation Screen allows you to allocate funds to a policy and direct those allocations to various investment choices. You access the Allocation Screen by selecting the Allocate button at the bottom of the Policy Screen that contains the policy where you want to allocate funds. Note: You may see an allocation tab instead of an allocation button as a way to navigate to setup allocations for a policy.
When selecting allocations you will be presented with the allocations screen. From the screen select the following:
Number of Funds
Equal amounts check box
NOTE: At the bottom of the allocations screen
is the OK button, selecting this saves the allocations. Then
select the Close button to exit the window.
Steps to Allocate Funds
Search for the policy that contains the funds you want to allocate.
Scroll to the bottom of the Policy Screen and select the Allocate button.
In the Future Allocations section, select the number of funds you want to use.
Move to the Fund section in the center of the screen. Select the funds from the drop down box.
Select the Equal % check box if you want the money to be distributed between the funds equally. You can type the percent directly into the Percent box if you want to manually enter each fund's percent.
Note: Your business rules may state that when you click the Equal % check box, but have an odd number of funds, the system will fill in ’r;0’ and you must manually enter the percents.
Allocations can be setup for different functions of a policy. In Acme, allocations can be setup for the following:
Systematic Withdraw Program
Dollar Cost Averaging Program
In Acme, by selecting on the Allocate button on the Policy screen you are setting the allocations as the default for the future contributions to the policy. Depending on the policy any number of funds with in the given limit can be chosen and the method money may be either percentage, an amount or mixed.
If we select allocation method as percent, then total percent should be 100.
If we select Equal % then it takes equal number to all funds such that total should be 100.
Automatic Payment Program
The AutoPay Program is intended for those annuitiants that wish to set
up periodic contributions to their policy during the Accumulation Phase
of the annuity. The annuitant sets default allocations for these contributions
in the Allocation Screen as shown.
Systematic Withdrawal Program (SWP)
The SWP is a method of withdrawing funds from the annuity in specified amounts for a specified payment frequency. The annuitant is not guaranteed lifelong payments as he or she is with the standard annuitization method. 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 sets default allocations for these withdrawals in the Allocation Screen.
Portfolio rebalancing programs "rebalance" the amount of money allocated to each investment portfolio at designated intervals. This is designed as such because fund allocations gradually fall out of alignment as some portfolio share values grow faster than others. Some asset allocation programs regularly review an investor's financial goals and market conditions and make corresponding changes in the investment portfolios the owner invests in. As seen below, the desired asset mix to be targeted by each of these rebalance transfers is set on the Allocation Screen.
Dollar Cost Averaging (DCA) Program
It is a periodic investment program that does not guarantee profits or protect against losses in a declining market. The idea is based on continuous investing, counting on fluctuating price levels in order to lower the inherent risk in investing lump sums at one point in time. DCA is different than AutoPay in that all of the money is contributed from the start and placed in a “safer” fund such as a Money Market fund, and then gradually transferred into higher risk funds. The allocations for these DCA fund transfers are set on the Allocation Screen, as seen below.