As a result, he said all customers would be able to choose between two types of tariff - variable and fixed - and receive more transparent bills.
Some will allow a top-up to variable-rate Isas, but not to fixed-rate products.
They were issued by Manulife (subsequently taken over by John Hancock) and were called Flexible Purchase Payment Deferred Combination Fixed and Variable Annuity Contracts Non- Participating.
Repaying debt has become more difficult in part because loan balances have grown and the interest rates on federal loans have increased as a result of a shift from variable-rate to fixed-rate loans.
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The answer is, overwhelmingly, insurance companies peddling high-cost, tax-deferred variable annuities with crappy proprietary mutual fund options and high-risk fixed accounts.
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All this would be similar to a homeowner forsaking a 4.5% fixed-rate 30-year mortgage for a variable-rate mortgage of nearly 5%.
The same is true of the assumption that the mortgage repayment will rise (it could be a longer-term fixed rate for example), or by how much - we have used the Standard Variable Rate (SVR), but the borrower may be using a mortgage which charges a different interest margin.
In a typical interest-rate swap, one party agrees to exchange a fixed-rate obligation with another that has a floating, or variable, rate exposure.
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Variable-rate loans have lower initial rates than fixed-rate loans but can be more costly if interest rates rise.
All were former Abbey customers, who were put on standard variable rate (SVR) mortgages after coming off fixed-rate deals.
Most Britons, for instance, still have variable-rate mortgages, although the proportion with fixed-rate home loans is rising (thanks, in part, to lower inflation).
Inside it, ING was selling variable and fixed annuities, which are mutual funds and bond-like investments wrapped in life insurance that, in policies like ING's, cost several times more than low-cost alternatives and provide minimal coverage.
He found that the availability of discounted variable-rate deals crowded out comparatively expensive longer-term fixed-rate loans.
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Unlike the fixed interest associated with savings accounts, credit card interest is variable and can change--mostly higher--at any time.
Harvard had some variable-rate borrowings, and the derivatives effectively converted those debts into fixed-rate ones.
The US government has then traded a fixed rate of 0.57 for a bet on the variable rate of US T-Bills over the the next 10 years.
Lenders' standard variable rate (SVR) deals are tending to be more attractive than new fixed-rate deals for owners, with interest rates having plunged in recent months.
With a deferred annuity, you pay now and hope to accumulate assets through either a variable product that invests in equity mutual funds or a fixed product that offers bond-like returns.
Messrs Feldstein and Samwick also assume that retired folk will convert their personal retirement accounts into a variable-rate annuity, based on a combination of stocks and bonds, rather than a fixed-rate annuity.
Fixed-rate mortgages are due to expire for about two million people over the next 18 months, reverting to high variable rates.
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