Annuity having interest rate coupled to a referenced interest rate

A computer-implemented method for managing a financial agreement comprising:

• receiving a purchase payment;
• and
• generating at a processor a financial agreement, comprising:
• a base interest rate;
• a specified time period during which a first interest rate is provided that is equal to the base interest rate, the specified time period having a beginning and an end;
• and
• an interest enhancement applied to the first interest rate at the end of the specified time period based on changes in a referenced rate of interest as defined at the beginning of the specified time period, wherein:
• (a) if the value of the referenced rate of interest on the date said interest enhancement is calculated is not greater than the value of the referenced rate of interest at the beginning of the specified time period, said interest enhancement is zero;
• and
• (b) if the value of the referenced rate of interest on the date the interest enhancement is calculated is greater than the value of the referenced rate of interest at the beginning of the specified time period, a positive interest enhancement is applied;
• and
• wherein a second interest rate is provided after the interest enhancement is calculated and wherein the second interest rate is the sum of the base interest rate and the interest enhancement.

A computer-implemented method of administering a financial account comprising:

• electronically storing in an electronic storage the value of the financial account;
• defining at a processor and electronically storing in the electronic storage a base interest rate;
• electronically applying at the processor the base interest rate to the value of the financial account for an initial predefined period to obtain a first result;
• electronically storing in the electronic storage the first result;
• obtaining and electronically storing in the electronic storage a base referenced rate of interest as of a specified date;
• obtaining a current referenced rate of interest as of the date the current referenced rate of interest is determined;
• electronically storing in the electronic storage the current referenced rate of interest;
• determining at the processor a total interest rate by comparing the base referenced rate of interest to the current referenced rate of interest, and:
• (i) if the current referenced rate of interest is less than or equal to the base referenced rate of interest, determining the total interest rate to be equal to the base interest rate, and
• (ii) if the current referenced rate of interest is greater than the base referenced rate of interest, determining the difference between the current referenced rate of interest and the base referenced rate of interest and determining the total interest rate to be the sum of the base interest rate and an interest enhancement that is determined based on said difference between the current referenced rate of interest and the base referenced rate of interest;
• and
• electronically storing in the electronic storage the total interest rate.

A computer-readable medium comprising computer-executable instructions that when executed cause a computer device to perform the method of administering a financial account comprising:

• defining at a processor a base interest rate, said base interest rate being applied to the value of the account for an initial predefined period;
• defining at the processor a base referenced rate of interest as of an initial date;
• for each subsequent predefined period following the initial predefined period:
• (A) determining at the processor a current referenced rate of interest as of a second date;
• (B) defining at the processor a total interest rate that will be applied to the value of the account during the subsequent predefined period, wherein:
• (i) if the current referenced rate of interest is less than or equal to the base referenced rate of interest, the total interest rate will be equal to the base interest rate;
• and
• (ii) if the current referenced rate of interest is greater than the base referenced rate of interest, the total interest rate will be determined based on the difference between the current referenced rate of interest and the base referenced rate of interest;
• and
• applying at the processor the total interest rate for each subsequent predefined period to the value of the account during the predefined period.