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#2214514 - 05/29/19 03:45 PM IRA Financial Projection and TIS
Likes to Comply Offline
Diamond Poster
Joined: Nov 2008
Posts: 1,060
In the mountains
Product - 12 month IRA CD, auto renewal. We spoke with our regulator and as a result of that conversation disclose compounding and crediting on the TIS as interest will not be compounded and will be credited to the account at maturity since this is what will happen during that 12 month term and is how the APY is calculated.

With regards to the IRA Calculated Financial Projection for 5 years, Age 60, Age 65 and Age 70 - since the interest is credited back to the account at maturity and since the CD is auto renewed, should the value of the IRA include the interest earned at the end of each year under the projected value column (assume projection includes just the initial deposit and not further contributions)?

For example:
IRA Value at end of
Year 1 - 1,015
Year 2 - 1,030.22
etc.

or should it be disclosed as:
Year 1 - 1,000
Year 2 - 1,000
etc.?

Thanks in advance.
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Always learning something new...

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Operations Compliance
#2214736 - 05/31/19 11:55 PM Re: IRA Financial Projection and TIS Likes to Comply
el guapo Offline
Gold Star
el guapo
Joined: Jul 2004
Posts: 345
Is there a reason you aren't using Method 1 (the pre-printed table) near or at the end of your IRA opening document (Application/Plain Language Disclosure/Financial Disclosure) and just highlighting the first 5 years, and the rows that correspond with the customer attaining the ages of 60, 65, and 70? I thought everyone took the easy way out and did this rather than provide a custom financial disclosure.

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#2214789 - 06/03/19 06:14 PM Re: IRA Financial Projection and TIS Likes to Comply
Likes to Comply Offline
Diamond Poster
Joined: Nov 2008
Posts: 1,060
In the mountains
That's a good question. I'll ask the Deposit Operations area about this.

Thanks,
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Always learning something new...

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