Joint and Survivor Annuities

[Guest rhector12]

Hello,

I need some help with interpolating joint and survivor annuity factors manually (In Excel) for fractional ages of both participant and spouse. I have factors for Participant Whole Age/Spouse Whole Age, Participant Whole Age+1/Spouse Age, Participant Whole Age/Spouse Age+1, and Participant Whole Age+1/Spouse Whole Age+1. My problem is, how would the interpolation work simultaneously for the spouse, while I am interpolating the factors for the Participant's Age and Age+1?

I have attempted it, but, I am off from the annuity calculator that I am using, even though I am starting with the same results at whole ages to do my interpolation. I am off by .0007 at the most among the various J&Ss. I do not think it is necessarily a rounding issue. It looks like some special interpolation might be occuring.

Can you provide some insight on how some of you interpolate to derive results at fractional ages for both participant and spouse?

Your help would be greatly appreciated.

Thanks.

[ETA Consulting LLC]

I feel your pain. Chance are you are calculating it correctly and the Table you are referencing is incorrect. I ended up indexing the factor from a preloaded chart where the user enters the age of the Participant and the age of the Spouse. I know it doesn't help, but just showing appreciation for what you are trying to do.

[Guest rhector12]

I feel your pain. Chance are you are calculating it correctly and the Table you are referencing is incorrect. I ended up indexing the factor from a preloaded chart where the user enters the age of the Participant and the age of the Spouse. I know it doesn't help, but just showing appreciation for what you are trying to do.

Hi,

Thank you so much for your response. Co-workers who do not work on this stuff do not appreciate the effort involved in getting the right results. To them being off by what they consider a very small number is something that should be foregone; but, others appreciate getting the right results and others like you surely understand the importance of such.

Thanks.

[SoCalActuary]

You did indicate that you were interpolating annuity rates. The factors at the integral ages are also the result of the ratio of two annuity tables with slightly different slopes.

My personal preference is to use the full 1440 monthly lx factors for each participant (120 year table with 12 monthly interpolations). You can then determine a more exact result.

Don't forget that the final answer is a benefit payment to an individual, and that the plan administratory is responsible for taking reasonable action to interpret the rules.

Your improved accuracy on the modeling method you chose may be an act of masturbation. The PA has the final word.

[david rigby]

Don't forget that the final answer is a benefit payment to an individual, and that the plan administratory is responsible for taking reasonable action to interpret the rules.

Your improved accuracy on the modeling method you chose may be an act of masterbation. The PA has the final word.

While the imagery is not attractive, it may be worthwhile to note that consistency is important also.