<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 4 (File No. 33-54471) X
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940
Amendment No. 5 (File No. 811-7195) X
AMERICAN ENTERPRISE VARIABLE ANNUITY ACCOUNT
___________________________________________________________________
(Exact Name of Registrant)
American Enterprise Life Insurance Company
___________________________________________________________________
(Name of Depositor)
80 South 8th Street, P.O. Box 534, Minneapolis, MN 55440-0534
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code (612) 671-3678
Mary Ellyn Minenko, IDS Tower 10, Minneapolis, MN 55440-0010
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering
It is proposed that this filing will become effective (check
appropriate box)
immediately upon filing pursuant to paragraph (b) of Rule 485
on (date) pursuant to paragraph (b) of Rule 485
X 60 days after filing pursuant to paragraph (a)(i) of Rule 485
on (date) pursuant to paragraph (a)(i) of Rule 485
75 days after filing pursuant to paragraph (a)(ii)
on (date) pursuant to paragraph (a)(ii) of rule 485
If appropriate, check the following box:
this post-effective amendment designates a new effective date
for a previously filed post-effective amendment.
The Registrant has registered an indefinite number or amount of
securities under the Securities Act of 1933 pursuant to Section
24-f of the Investment Company Act of 1940. Registrant's Rule 24f-
2 Notice for its most recent fiscal year ended was filed on or
about February 23, 1996.
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CROSS REFERENCE SHEET
<TABLE>
<CAPTION>
Cross reference sheet showing location in the prospectus and Statement of Additional
Information of the information called for by the items enumerated in Part A and B of
Form N-4.
Negative answers omitted from prospectus and Statement of Additional Information are
so indicated.
PART A PART B
Section in
Section Statement of
Item No. in Prospectus Item No. Additional Information
<C> <C> <C> <C>
1 Cover page 15 Cover page
2 Key terms 16 Table of contents
3(a) Expense summary 17(a) NA
(b) In brief (b) NA
(c) About American Enterprise Life*
4(a) Condensed financial
information 18(a) NA
(b) Performance information (b) NA
(c) Financial statements (c) Independent auditors
(d) NA
5(a) About American (e) NA
Enterprise Life (f) NA
(b) The variable account
(c) The funds 19(a) Making the most of your annuity*
(d) Cover page and the funds (b) NA
(e) Voting rights
(f) NA 20(a) Principal underwriter
(b) Principal underwriter
6(a) Charges (c) NA
(b) Expense summary (d) NA
(c) Other information on (d) NA
charges
(d) Distribution of 21(a) Performance information
contracts (b) Performance information
(e) NA
(f) NA 22 Calculating Annuity Payouts
7(a) Buying your annuity; 23(a) NA
Benefits in case of (b) NA
death; The annuity
payout period
(b) The variable account;
Transferring money between
accounts; Transfer policies
(c) The funds; Other information
on charges
(d) The funds
8(a) The annuity payout period
(b) Setting the retirement date
(c) Annuity payout plans
(d) The annuity payout period
(e) Annuity payout plans
(f) Death after annuity payouts
begin
9(a) Benefits in case of death
(b) Benefits in case of death
10(a) Buying your annuity;
Valuing your investment
(b) Valuing your investment
(c) Valuing your investment
(d) About American Enterprise
Life
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11(a) Withdrawals from your contract
(b) NA
(c) Receiving payment when you
request a withdrawal
(d) If installment payments
(e) Ten-day free look
12(a) Taxes
(b) Key terms
(c) NA
13 NA
14 Table of contents of the
Statement of Additional Information
*Designates section in the prospectus, which is hereby incorporated by reference
in this Statement of Additional Information.
</TABLE>
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AEL Personal PortfolioSM
____________________, 1996
Variable Annuity Prospectus
The AEL Personal PortfolioSM is a flexible premium variable annuity
contract offered by American Enterprise Life Insurance Company
(American Enterprise Life) a subsidiary of IDS Life Insurance
Company (IDS Life), which is a subsidiary of American Express
Financial Corporation. Purchase payments may be allocated among
different accounts, providing variable and/or fixed returns and
payouts. The annuity is available for qualified and nonqualified
retirement plans.
American Enterprise Variable Annuity Account
Sold by: American Enterprise Life Insurance Company.
Administrative Office: 80 South Eighth Street, P.O. Box 534,
Minneapolis, MN 55440-0534. Telephone: 612-671-7700.
THIS PROSPECTUS CONTAINS THE INFORMATION ABOUT THE VARIABLE ACCOUNT
THAT YOU SHOULD KNOW BEFORE INVESTING. Refer to "The variable
account" in this prospectus.
THE PROSPECTUS IS ACCOMPANIED OR PRECEDED BY THE FOLLOWING
PROSPECTUSES: THE RETIREMENT ANNUITY MUTUAL FUND PROSPECTUS
(DESCRIBING IDS LIFE AGGRESSIVE GROWTH FUND, IDS LIFE INTERNATIONAL
EQUITY FUND, IDS LIFE CAPITAL RESOURCE FUND, IDS LIFE MANAGED FUND,
IDS LIFE SPECIAL INCOME FUND, AND IDS LIFE MONEYSHARE FUND); THE
OCC ACCUMULATION TRUST,FORMERLY KNOWN AS QUEST FOR VALUE
ACCUMULATION TRUST (DESCRIBING OCC ACCUMULATION TRUST MANAGED
PORTFOLIO AND OCC ACCUMULATION TRUST U.S. GOVERNMENT INCOME
PORTFOLIO); THE PUTNAM CAPITAL MANAGER TRUST (DESCRIBING PCM
DIVERSIFIED INCOME FUND, PCM GROWTH AND INCOME FUND, PCM HIGH YIELD
FUND AND PCM NEW OPPORTUNITIES FUND); AND GT GLOBAL VARIABLE
INVESTMENT FUNDS (DESCRIBING GT GLOBAL VARIABLE LATIN AMERICA FUND
AND GT GLOBAL VARIABLE NEW PACIFIC FUND). PLEASE KEEP THESE
PROSPECTUSES FOR FUTURE REFERENCE.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
AMERICAN ENTERPRISE LIFE IS NOT A FINANCIAL INSTITUTION, AND THE
SECURITIES IT OFFERS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY ANY FINANCIAL INSTITUTION NOR ARE THEY
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER AGENCY. INVESTMENTS IN THE ANNUITY
INVOLVE INVESTMENT RISK INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
<PAGE>
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A Statement of Additional Information (SAI) dated ________________,
1996 (incorporated by reference into this prospectus) has been
filed with the Securities and Exchange Commission (SEC), and is
available without charge by contacting American Enterprise Life at
the telephone number above or by completing and sending the order
form on the last page of this prospectus. The table of contents of
the SAI is on the last page of this prospectus.
<PAGE>
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Table of contents
Key terms.....................................................
The AEL Personal PortfolioSM in brief.........................
Expense summary...............................................
Financial statements..........................................
Performance information.......................................
The variable account..........................................
The funds.....................................................
IDS Life Aggressive Growth Fund..........................
IDS Life International Equity Fund.......................
IDS Life Capital Resource Fund...........................
IDS Life Managed Fund....................................
IDS Life Special Income Fund.............................
IDS Life Moneyshare Fund.................................
OCC Accumulation Trust Managed Portfolio.................
OCC Accumulation Trust U.S. Government Income Portfolio..
PCM Diversified Income Fund..............................
PCM Growth and Income Fund...............................
PCM High Yield Fund......................................
PCM New Opportunities Fund...............................
GT Global Variable Latin America Fund....................
GT Global Variable New Pacific Fund......................
The fixed account.............................................
Buying your annuity...........................................
The retirement date......................................
Beneficiary..............................................
How to make payments.....................................
Charges.......................................................
Contract administrative charge...........................
Variable account administrative charge...................
Mortality and expense risk fee...........................
Withdrawal charge........................................
Waiver of withdrawal charges.............................
Premium taxes............................................
Valuing your investment.......................................
Number of units..........................................
Accumulation unit value..................................
Net investment factor....................................
Factors that affect variable subaccount
accumulation units...................................
Making the most of your annuity...............................
Automated dollar-cost averaging..........................
Transferring money between subaccounts...................
Transfer policies........................................
Two ways to request a transfer or a withdrawal...........
Withdrawals from your contract................................
Withdrawal policies......................................
Receiving payment when you request a withdrawal..........
Changing ownership............................................
Benefits in case of death.....................................
The annuity payout period.....................................
Annuity payout plans.....................................
Death after annuity payouts begin........................
Taxes.........................................................
Voting rights.................................................
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Substitution of investments...................................
Distribution of the contracts.................................
About American Enterprise Life................................
Regular and special reports...................................
Services................................................
Table of contents of the Statement of Additional
Information.............................................
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Key terms
These terms can help you understand details about your annuity.
Annuity - A contract purchased from an insurance company that
offers tax-deferred growth of the contract owner's investment until
earnings are withdrawn, and that can be tailored to meet the
specific needs of the individual during retirement.
Accumulation unit - A measure of the value of each variable
subaccount before annuity payouts begin.
Annuitant - The person on whose life or life expectancy the annuity
payouts are based.
Annuity payouts - An amount paid at regular intervals under one of
several plans available to the owner and/or any other payee. This
amount may be paid on a variable or fixed basis.
Annuity unit - A measure of the value of each variable subaccount
used to calculate the annuity payouts you receive.
Beneficiary - The person designated to receive annuity benefits in
case of the owner's or annuitant's death.
Close of business - When the New York Stock Exchange (NYSE) closes,
normally 3 p.m. Central time.
Code - Internal Revenue Code of 1986, as amended.
Contract value - The total value of your annuity before any
applicable withdrawal charge and any contract administrative charge
have been deducted.
Contract year - A period of 12 months, starting on the effective
date of your contract and on each anniversary of the effective
date.
Fixed account - An account to which you may allocate purchase
payments. Amounts allocated to this account earn interest at rates
that are declared periodically by American Enterprise Life.
Mutual funds (funds) - Fourteen mutual funds or portfolios, each
with a different investment objective. (See "The funds.") You may
allocate your purchase payments into variable subaccounts investing
in shares of any or all of these funds.
Owner (you, your) - The person who controls the annuity (decides on
investment allocations, transfers, payout options, etc.). Usually,
but not always, the owner is also the annuitant. The owner is
responsible for taxes, regardless of whether he or she receives the
annuity's benefits.
Purchase payments - Payments made to American Enterprise Life for
an annuity.
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Qualified annuity - An annuity purchased for a retirement plan that
is subject to applicable federal law and any rules of the plan
itself. These plans include:
o Individual Retirement Annuities (IRAs)
o Simplified Employee Pension Plans (SEPs)
All other annuities are considered nonqualified annuities.
Retirement date - The date when annuity payouts are scheduled to
begin. This date is first established when you start your
contract. You can change it in the future.
Withdrawal charge - A deferred sales charge that may be applied if
you make a withdrawal from your annuity before the retirement date.
Withdrawal value - The amount you are entitled to receive if you
fully withdraw your annuity. It is the contract value minus any
applicable withdrawal charge and contract administrative charge.
Valuation date - Any normal business day, Monday through Friday,
that the NYSE is open. The value of each variable subaccount is
calculated at the close of business on each valuation date.
Variable account - Consists of fourteen separate subaccounts to
which you may allocate purchase payments; each invests in shares of
one mutual fund. (See "The variable account.") The value of your
investment in each variable subaccount changes with the performance
of the particular fund.
The AEL Personal PortfolioSM in brief
Purpose: The AEL Personal PortfolioSM is designed to allow you to
build up funds for retirement. You do this by making one or more
investments (purchase payments) that may earn returns that increase
the value of the annuity. Beginning at a specified future date
(the retirement date), the annuity provides lifetime or other forms
of payouts to you or to anyone you designate.
Ten-day free look: You may return your annuity to your agent or
our Minneapolis administrative office within 10 days after it is
delivered to you and receive a full refund of the contract value.
No charges will be deducted. However, you bear the investment risk
from the time of purchase until return of the contract; the refund
amount may be more or less than the payment you made. (Exceptions:
If the law so requires, all of your purchase payments will be
refunded.)
Accounts: You may allocate your purchase payments among any or all
of:
o fourteen variable subaccounts of the variable account, each of
which invests in mutual funds with a particular investment
objective. The value of each variable subaccount varies with
the performance of the particular fund. We cannot guarantee <PAGE>
PAGE 10
that the value at the retirement date will equal or exceed the
total of purchase payments allocated to the variable
subaccounts. (p. )
o one fixed account, which earns interest at rates that are
adjusted periodically by American Enterprise Life. (p. )
Buying the annuity: Your agent will help you complete and submit
an application. Applications are subject to acceptance at our
Minneapolis administrative office. You may buy a nonqualified
annuity or a qualified annuity. Payment must be made in a lump sum
with the option of additional payments in the future. In some
states there are time limitations for making additional payments.
o Minimum initial payment - $2,000
o Minimum additional payment - $50
o Maximum total payment(s) (without prior approval) - $1,000,000
Transfers: Subject to certain restrictions you may redistribute
your money among accounts without charge at any time until annuity
payouts begin, and once per contract year among the variable
subaccounts thereafter. You may establish automated transfers
among the fixed account and variable subaccount(s). (p. )
Withdrawals: You may withdraw all or part of your contract value
at any time before the retirement date. You also may establish
automated partial withdrawals. Withdrawals may be subject to
charges and tax penalties (including a 10% IRS penalty if
withdrawals are made prior to your reaching age 59 1/2) and may
have other tax consequences; also, certain restrictions apply.
(p. )
Changing ownership: You may change ownership of a nonqualified
annuity by written instruction, however, such changes of
nonqualified annuities may have federal income tax consequences.
Certain restrictions apply concerning change of ownership of a
qualified annuity. (p. )
Payment in case of death: If you or the annuitant dies before
annuity payouts begin, we will pay the beneficiary an amount at
least equal to the contract value. (p. )
Annuity payouts: The contract value of your investment can be
applied to an annuity payout plan that begins on the retirement
date. You may choose from a variety of plans to make sure that
payouts continue as long as they are needed. If you purchased a
qualified annuity, the payout schedule must meet requirements of
the qualified plan. Payouts may be made on a fixed or variable
basis, or both. Total monthly payouts include amounts from each
variable subaccount and the fixed account. (p. )
Taxes: Generally, your annuity grows tax-deferred until you fully
withdraw it or begin to receive payouts. (Under certain
circumstances, IRS penalty taxes may apply.) Even if you direct
payouts to someone else, you will still be taxed on the income if
you are the owner. (p. )<PAGE>
PAGE 11
Charges: Your AEL Personal PortfolioSM is subject to a $30 annual
contract administrative charge, a 0.15% variable account
administrative charge, a 1.25% mortality and expense risk fee, a
withdrawal charge and any premium taxes that may be imposed by
state or local governments. Premium taxes are deducted either from
your purchase payments or upon total withdrawal or when annuity
payments begin. (p. )
Expense summary
The purpose of this summary is to help you understand the various
costs and expenses associated with the AEL Personal PortfolioSM.
You pay no sales charge when you purchase the AEL Personal
PortfolioSM. All costs that you bear directly or indirectly for
the variable subaccounts and underlying mutual funds are shown
below. Some expenses may vary as explained under "Contract
charges."
Direct charges. These are deducted directly from the contract
value. They include:
Withdrawal charge: The withdrawal charge starts at 7% of the
purchase payment in the first contract year of payment receipt and
decreases by 1% each contract year thereafter. There is no
withdrawal charge on earnings and on purchase payments we received
in any contract year six or more years prior to the contract year
of withdrawal.
Annual contract administrative charge: $30.
Indirect charges. The variable account pays these expenses out of
its assets. They are reflected in the variable subaccounts' daily
accumulation unit values and are not charged directly to your
account. They include:
Mortality and expense risk fee: 1.25% per year, deducted from the
subaccounts of the variable account as a percentage of the average
daily net assets of the underlying fund.
Variable account administrative charge: 0.15% per year, deducted
from the subaccounts of the variable account as a percentage of the
average daily net assets of the underlying fund.
Operating expenses of underlying mutual funds: management fees and
other expenses deducted as a percentage of average net assets as
follows: *
<TABLE><CAPTION>
OCC***
IDS Life IDS Life IDS Life IDS Life Accumulation
Aggressive International Capital IDS Life Special IDS Life Trust Managed
Growth Equity Resource Managed Income Moneyshare Portfolio
(After Expense
Limitations)
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees .64% .86% .63% .62% .63% .54% .80%
Other expenses .04 .09 .04 .03 .04 .05 .14
Total .68%** .95%** .67%** .65%** .67%** .59%** .94%<PAGE>
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OCC
Accumulation
Trust U.S. Gov- PCM PCM GT Global GT Global
ernment Income Diversified Growth and PCM High PCM New Variable Variable
Portfolio Income Income Yield Opportunities Latin America New Pacific
(After Expense (After Expense (After Expense
Limitations) Reimbursements) Reimbursements)
Management fees .60% .70% .52% .70% .70% 1.00% 1.00%
Other expenses .40 .15 .05 .09 .14 .25 .25
Total 1.00% .85% .57% .79% .84% 1.25++ 1.25++
*Premium taxes imposed by some state and local governments are not reflected in this table.
**Annualized operating expenses of underlying mutual funds at Dec. 31, 1995.
***The annual expenses of the OCC Accumulation Trust Portfolios as of Dec. 31, 1995 have been restated to reflect new management
fee and expense limitation agreements in effect as of May 1, 1996. Effective May 1, 1996, the expenses of the Portfolios of the
OCC Accumulation Trust are contractually limited by OpCap Advisors so that their respective annualized operating expenses do not
exceed 1.25% of their respective average daily net assets. Furthermore, through April 30, 1997, the annualized operating
expenses of the Managed and U.S. Government Income Portfolios will be voluntary limited by OpCap Advisors so that annualized
operating expenses of these Portfolios do not exceed 1.00% of their respective average daily net assets. Without such voluntary
expense limitations, and taking into account the revised contractual provisions effective May 1, 1996 concerning management fees
and expense limitations, the Management Fees, Other Expenses and Total Portfolio Annual Expenses incurred for the fiscal year
ended Dec. 31, 1995 would have been .80%, .14% and .94%, respectively, for the Managed Portfolio and .60%, .65% and 1.25%,
respectively, for the U.S. Government Income Portfolio.
++Figures in the "Other Expenses" and "Total" columns are restated from the amounts you would have incurred in 1995 to reflect fee
and reimbursement or waiver arrangements. If there had been no reimbursement of expenses by LGT Asset Management and no expense
reductions, the actual expenses of each Fund, expressed as a percentage of net assets, with "Management fees" stated first, then
"Other expenses," followed by "Total," would have been as follows: GT Global Variable Latin America Fund, 1.00%, 0.69%, 1.69%;
and GT Global Variable New Pacific Fund, 1.00%, 0.61%, 1.61%.
Example:*
OCC
IDS Life IDS Life IDS Life IDS Life Accumulation
Aggressive International Capital IDS Life Special IDS Life Trust Managed
Growth Equity Resource Managed Income Moneyshare Portfolio
You would pay the following expenses on a $1,000 investment, assuming 5% annual return and full withdrawal at the end of each time
period:
1 year
3 years
5 years
10 years
You would pay the following expenses on the same investment assuming no withdrawal or selection of an annuity payout plan at the
end of each time period:
1 year
3 years
5 years
10 years
OCC
Accumulation
Trust U.S. Gov- PCM PCM GT Global GT Global
ernment Income Diversified Growth and PCM High PCM New Variable Variable
Portfolio Income Income Yield Opportunities Latin America New Pacific
You would pay the following expenses on a $1,000 investment, assuming 5% annual return and full withdrawal at the end of each time
period:
1 year
3 years
5 years
10 years
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PAGE 13
You would pay the following expenses on the same investment assuming no withdrawal or selection of an annuity payout plan at the
end of each time period:
1 year
3 years
5 years
10 years
</TABLE>
This example should not be considered a representation of past or
future expenses. Actual expenses may be more or less than those
shown.
* In this example, the $30 annual contract administrative charge is
approximated as a .170% charge based on the estimated average
contract size.
Financial Statements
[to be filed by amendment]
Performance information
Performance information for the variable subaccounts may appear
from time to time in advertisements or sales literature. In all
cases, such information reflects the performance of a hypothetical
investment in a particular account during a particular time period.
The following performance figures are calculated on the basis of
historical performance of the funds. The performance figures
relating to these funds assume that the contract was in existence
prior to Jan. 12, 1995, which it was not. Beginning Jan. 12, 1995,
when these funds became available as investment options under the
contract, actual values are used for the calculations.
Calculations are performed as follows:
Simple yield - IDS Life Moneyshare Subaccount: Income over a given
seven-day period (not counting any change in the capital value of
the investment) is annualized (multiplied by 52) by assuming that
the same income is received for 52 weeks. This annual income is
then stated as an annual percentage return on the investment.
Compound yield - IDS Life Moneyshare Subaccount: Calculated like
simple yield, except that, when annualized, the income is assumed
to be reinvested. Compounding of reinvested returns increases the
yield as compared to a simple yield.
Yield - Special Income Subaccount: Net investment income (income
less expenses) per accumulation unit during a given 30-day period
is divided by the value of the unit on the last day of the period.
The result is converted to an annual percentage.
Average annual total return: Expressed as an average annual
compounded rate of return of a hypothetical investment over a
period of one, five and 10 years (or up to the life of the account
if it is less than 10 years old). This figure reflects deduction
of all applicable charges, including the contract administrative <PAGE>
PAGE 14
charge, variable account administrative charge, mortality and
expense risk fee, and withdrawal charge, assuming a full withdrawal
at the end of the illustrated period. Optional average annual
total return quotations may be made that do not reflect a
withdrawal charge deduction (assuming no withdrawal).
Aggregate total return: Represents the cumulative change in the
value of an investment over a specified period of time (reflecting
change in a subaccount's accumulation unit value). The calculation
assumes reinvestment of investment earnings and reflects the
deduction of all applicable charges, including the contract
administrative charge, mortality and expense fee, variable account
administrative charge and withdrawal charge, assuming a withdrawal
at the end of the illustrated period. Optional total return
quotations may be made that do not reflect a withdrawal charge
deduction (assuming no withdrawal). Aggregate total return may be
shown by means of schedules, charts or graphs.
Performance information should be considered in light of the
investment objectives and policies, characteristics and quality of
the fund in which the subaccount invests, and the market conditions
during the given time period. Such information is not intended to
indicate future performance. Because advertised yields and total
return figures include all charges attributable to the annuity,
which has the effect of decreasing advertised performance,
subaccount performance should not be compared to that of mutual
funds that sell their shares directly to the public. (See the SAI
for a further description of methods used to determine yield and
total return for the subaccounts.)
If you would like additional information about actual performance,
contact American Enterprise Life at the address or telephone number
on the cover.
The variable account
Purchase payments can be allocated to any or all of the subaccounts
of the variable account that invest in shares of the following
funds:
Subaccount
IDS Life Aggressive Growth Fund EAG
IDS Life International Equity Fund EIE
IDS Life Capital Resource Fund ECR
IDS Life Managed Fund EMG
IDS Life Special Income Fund ESI
IDS Life Moneyshare Fund EMS
OCC Accumulation Trust Managed Portfolio EMD
OCC Accumulation Trust U.S. Government
Income Portfolio EUS
PCM Diversified Income Fund EDI
PCM Growth and Income Fund EGI
PCM High Yield Fund EHY
PCM New Opportunities Fund ENO
GT Global Variable Latin America Fund ELA
GT Global Variable New Pacific Fund EPA
<PAGE>
PAGE 15
Each variable subaccount meets the definition of a separate account
under federal securities laws. Income, capital gains and capital
losses of each subaccount are credited or charged to that
subaccount alone. No variable subaccount will be charged with
liabilities of any other variable account or of our general
business. All obligations arising under the contracts are general
obligations of IDS Life.
The variable account was established under Indiana law on July 15,
1987, and the subaccounts are registered together as a single unit
investment trust under the Investment Company Act of 1940 (the 1940
Act). This registration does not involve any supervision of our
management or investment practices and policies by the SEC. All
obligations arising under the contracts are general obligations of
American Enterprise Life.
The funds
IDS Life Aggressive Growth Fund
Objective: capital appreciation. Invests primarily in common stock
of small- and medium-size companies.
IDS Life International Equity Fund
Objective: capital appreciation. Invests primarily in common stock
of foreign issuers and foreign securities convertible into common
stock.
IDS Life Capital Resource Fund
Objective: capital appreciation. Invests primarily in U.S. common
stocks and other securities convertible into common stock,
diversified over many different companies in a variety of
industries.
IDS Life Managed Fund
Objective: maximum total investment return. Invests primarily in
U.S. common stocks, securities convertible into common stock,
warrants, fixed income securities (primarily high-quality corporate
bonds) and money market instruments.
IDS Life Special Income Fund
Objective: to provide a high level of current income while
conserving the value of the investment for the longest time period.
Invests primarily in high-quality, lower-risk corporate bonds
issued by many different companies in a variety of industries, and
in government bonds.
IDS Life Moneyshare Fund
Objective: maximum current income consistent with liquidity and
conservation of capital. Invests in high-quality money market
securities with remaining maturities of 13 months or less. The
fund also will maintain a dollar-weighted average portfolio
maturity not exceeding 90 days. The fund attempts to maintain a
constant net asset value of $1 per share.
OCC Accumulation Trust Managed Portfolio
Objective: Growth of capital over time. Invests primarily in
common stocks, bonds and money market and cash equivalent
securities.<PAGE>
PAGE 16
OCC Accumulation Trust U.S. Government Income Portfolio
Objective: to provide a high level of current income together with
protection of capital. Invests exclusively in debt obligations,
including mortgage-backed securities, issued or guaranteed by the
United States government, its agencies or instrumentalities.
PCM Diversified Income Fund
Objective: high current income consistent with capital
preservation. Invests in the following three sectors of the fixed
income securities markets: U.S. government sector, high yield
sector and international sector.
PCM Growth and Income Fund
Objective: capital growth and current income. Invests primarily in
common stocks that offer potential for capital growth, current
income, or both.
PCM High Yield Fund
Objective: high current income and, when consistent with this
objective, a secondary objective of capital growth. Invests
primarily in high-yielding, lower-rated fixed income securities,
constituting a portfolio which Putnam Investment Management, Inc.
("Putnam Management") believes does not involve undue risk to
income or principal.
PCM New Opportunities Fund
Objective: long-term capital appreciation. Invests principally in
common stocks of companies in sectors of the economy which Putnam
Management believes may possess above average long-term growth
potential.
GT Global Variable Latin America Fund
Objective: capital appreciation. Invests primarily in a broad
range of securities including common and preferred stock, rights,
warrants and securities convertible into common stock, as well as
bonds, notes, debentures or other forms of indebtedness of Latin
American issuers.
(If your annuity was purchased in California, you cannot allocate
payments to the subaccount that invests in this fund)
GT Global Variable New Pacific Fund
Objective: long-term growth of capital. Invests under normal
circumstances, at least 65% of its assets in equity securities of
issuers domiciled in Australia, Hong Kong, Indonesia, Malaysia, New
Zealand, the Philippines, Singapore, South Korea, Taiwan and
Thailand.
(If your annuity was purchased in California, you cannot allocate
payments to the subaccount that invests in this fund)
All funds are available to serve as the underlying investment for
variable annuities, and some funds also are available to serve as
the underlying investment for variable life insurance contracts.
It is conceivable that in the future it may be disadvantageous for
variable annuity separate accounts and variable life insurance
separate accounts to invest in the available funds simultaneously.
<PAGE>
PAGE 17
Although American Enterprise Life and the funds do not currently
foresee any such disadvantages either to variable annuity contract
owners or to variable life insurance policy owners, the boards of
directors or trustees of the appropriate funds will monitor events
in order to identify any material conflicts between such contract
owners and policy owners and to determine what action, if any,
should be taken in response to a conflict. If a board were to
conclude that separate funds should be established for variable
life insurance and variable annuity separate accounts, the variable
annuity contract holders would not bear any expenses associated
with establishing separate funds.
The Internal Revenue Service (IRS) has issued final regulations
relating to the diversification requirements under Section 817(h)
of the Code. Each mutual fund intends to comply with these
requirements.
The U.S. Treasury and the IRS have indicated they may provide
additional guidance concerning how many variable subaccounts may be
offered and how many exchanges among variable subaccounts may be
allowed before the owner is considered to have investment control,
and thus is currently taxed on income earned within variable
subaccount assets. We do not know at this time what the additional
guidance will be or when action will be taken. We reserve the
right to modify the contract, as necessary, to ensure that the
owner will not be subject to current taxation as the owner of the
variable subaccount assets.
We intend to comply with all federal tax laws to ensure that the
contract continues to qualify as an annuity for federal income tax
purposes. We reserve the right to modify the contract as necessary
to comply with any new tax laws.
IDS Life, IDS Tower 10, Minneapolis, MN 55440, is the investment
manager for each of the IDS Life funds. OpCap Advisors, One World
Financial Center, New York, NY 10281, is the investment manager for
the OCC Accumulation Trust portfolios. Putnam Investment
Management, Inc., One Post Office Square, Boston, MA 02109, is the
investment manager for the PCM funds. LGT Asset Management, 50
California Street, San Francisco, CA 94111, is the investment
manager for the GT Global Funds.
The investment managers cannot guarantee that the funds will meet
their investment objectives. Please read the prospectuses for the
funds for complete information on investment risks, deductions,
expenses and other facts you should know before investing. These
prospectuses are available by contacting American Enterprise Life
at the administrative office address or telephone number on the
front of this prospectus.
The fixed account
Purchase payments can also be allocated to the fixed account. The
value of the fixed account increases as interest is credited to the
account. Purchase payments and transfers to the fixed account
become part of the general account of American Enterprise Life, the
<PAGE>
PAGE 18
company's main portfolio of investments. Interest is credited and
compounded daily to produce an effective annual interest rate. We
may change the interest rates from time to time.
Because of exemptive and exclusionary provisions, interests in the
fixed account have not been registered under the Securities Act of
1933 (1933 Act), nor is the fixed account registered as an
investment company under the 1940 Act. Accordingly, neither the
fixed account nor any interests in it are generally subject to the
provisions of the 1933 or 1940 Acts, and we have been advised that
the staff of the SEC has not reviewed the disclosures in this
prospectus that relate to the fixed account. Disclosures regarding
the fixed account, however, may be subject to certain generally
applicable provisions of the federal securities laws relating to
the accuracy and completeness of statements made in prospectuses.
Buying your annuity
Your agent will help you prepare and submit your application, and
send it along with your initial purchase payment to our Minneapolis
administrative office. As the owner, you have all rights and may
receive all benefits under the contract. The annuity can be owned
in joint tenancy only in spousal situations. You cannot buy a
nonqualified annuity or be an annuitant if you are 86 or older (age
76 or older for qualified annuities). (In Pennsylvania, the
annuitant must be under age 81.)
When you apply, you can select:
o the subaccount(s) or fixed account in which you want to invest;
o how you want to make purchase payments;
o the date you want to start receiving annuity payouts (the
retirement date); and
o a beneficiary.
If your application is complete, we will process it and apply your
purchase payment to your subaccount(s) and fixed account within two
days after we receive it. If your application is accepted, we will
send you a contract. If we cannot accept your application within
five days, we will decline it and return your payment. We will
credit additional purchase payments to your account(s) at the next
close of business.
The retirement date
Annuity payouts will be scheduled to begin on the retirement date.
This date can be aligned with your actual retirement from a job, or
it can be a different future date, depending on your needs and
goals and on certain restrictions. You can also change the date,
provided you send us written instructions at least 30 days before
annuity payouts begin.
For nonqualified annuities, the retirement date must be:
o no earlier than the 60th day after the contract's effective
date; and
o no later than the annuitant's 85th birthday (or before the 10th
contract anniversary, if purchased after age 75).<PAGE>
PAGE 19
o no later than the annuitant's 82nd birthday (or before the
eighth contract anniversary, if purchased after age 74) for
annuities purchased in Pennsylvania.
For qualified annuities, to avoid IRS penalty taxes, the retirement
date generally must be:
o on or after the annuitant reaches age 59 1/2;
o by April 1 of the year following the calendar year when the
annuitant reaches age 70 1/2.
If you are taking the minimum IRA distribution as required by the
Code from another tax-qualified investment, or in the form of
partial withdrawals from this annuity, annuity payouts can start as
late as the annuitant's 85th birthday or the 10th contract
anniversary. (In Pennsylvania, annuity payouts must start no later
than the annuitant's 82nd birthday or the eighth contract
anniversary.)
Beneficiary
If death benefits become payable before the retirement date, your
named beneficiary will receive all or part of the contract value.
If there is no named beneficiary, then you or your estate will be
the beneficiary. (See "Payment in case of death" for more about
beneficiaries.)
Minimum payment
If single payment:
Nonqualified: $2,000
Qualified: $2,000
Minimum additional purchase payment(s): $50
Maximum payment(s): $1,000,000 of cumulative payments without
prior approval
How to make payments
By letter
Send your check along with your name and account number to:
Regular mail:
American Enterprise Life Insurance Company
80 South Eighth Street
P.O. Box 534
Minneapolis, MN 55440-0534
<PAGE>
PAGE 20
Express mail:
American Enterprise Life Insurance Company
Attention: Unit 829
80 South Eighth Street
Minneapolis, MN 55402
Charges
Contract administrative charge
This fee is for establishing and maintaining your records. We
deduct $30 from the contract value on your contract anniversary at
the end of each contract year. We will waive this charge when the
contract value is $50,000 or more on the current contract
anniversary.
If you take a full withdrawal from your contract, the $30 annual
charge will be deducted at the time of withdrawal regardless of
contract value. The annual charge cannot be increased and does not
apply after annuity payouts begin.
Variable account administrative charge
This charge is applied daily to the variable subaccounts and
reflected in the unit values of the subaccounts. Annually, it
totals 0.15% of their average daily net assets. It covers certain
administrative and operating expenses of the subaccounts such as
accounting, legal and data processing fees and expenses involved in
the preparation and distribution of reports and prospectuses. The
variable account administrative charge cannot be increased.
Mortality and expense risk fee
This fee is to cover the mortality risk and expense risk and is
applied daily to the variable subaccounts and reflected in the unit
values of the subaccounts. The subaccounts pay this fee at the
time dividends are distributed from the funds in which they invest.
Annually the fee totals 1.25% of the subaccounts average daily net
assets. Approximately two-thirds of this amount is for our
assumption of mortality risk, and one-third is for our assumption
of expense risk. This fee does not apply to the fixed account.
Mortality risk arises because of our guarantee to make annuity
payouts according to the terms of the contract, no matter how long
a specific annuitant lives and no matter how long the entire group
of American Enterprise Life annuitants live. If, as a group,
American Enterprise Life annuitants outlive the life expectancy we
have assumed in our actuarial tables, then we must take money from
our general assets to meet our obligations. If, as a group,
American Enterprise Life annuitants do not live as long as
expected, we could profit from the mortality risk fee. Expense
risk arises because the contract administrative charge and variable
account administrative charge cannot be increased and may not cover
our expenses. Any deficit would have to be made up from our
general assets.
<PAGE>
PAGE 21
We do not plan to profit from the contract administrative charge or
the variable account administrative charge. However, we hope to
profit from the mortality and expense risk fee. We may use any
profits realized from this fee for any proper corporate purpose,
including, among others, payment of distribution (selling)
expenses. We do not expect that the withdrawal charge, discussed
in the following paragraphs, will cover sales and distribution
expenses.
Withdrawal charge
If you withdraw part or all of your contract, you may be subject to
a withdrawal charge. The withdrawal amount you request is
determined by drawing from your total contract value in the
following order:
1. First we withdraw up to 10% of your prior anniversary account
value not yet withdrawn this contract year. There is no withdrawal
charge on withdrawals totaling up to 10% of your prior anniversary
value each contract year.
2. Next we withdraw any contract earnings (contract value minus
all purchase payments received and not previously withdrawn) in
excess of the annual 10% free withdrawal amount. There is no
withdrawal charge on contract earnings.
3. Next, if necessary, we withdraw the old purchase payments,
starting with the first purchase payment made and not previously
withdrawn. There is no withdrawal charge on old payments that we
received in any contract year six or more years prior to the
contract year of withdrawal.
4. Finally, if necessary, we withdraw new purchase payments.
These are payments that we received during the contract year of
withdrawal and during the six immediately preceding contract years.
There is a withdrawal charge on new payments. We determine your
withdrawal charge by multiplying each of your new payments by the
applicable withdrawal charge percentage, and then summing the total
withdrawal charges.
The new payment withdrawal charge percentage depends on the number
of contract years since you made the payment(s).
Contract Years From Withdrawal Charge
Payment Receipt Percentage
1 7%
2 6%
3 5%
4 4%
5 3%
6 2%
7 1%
Thereafter 0%
Withdrawal charge calculation example
We determine your withdrawal charge by multiplying each of your new
payments by the applicable withdrawal charge percentage and then
summing the total withdrawal charges.<PAGE>
PAGE 22
For example, the withdrawal charge on a total withdrawal request
for a contract with this history:
o The contract date is July 1, 1996 with a contract year of July
1 through June 30 and with an anniversary date of July 1 each
year
o We received these payments - $10,000 July 1, 1996, $8,000 Dec.
31, 2002 and $6,000 Feb. 20, 2004
o The owner withdraws the contract for its total withdrawal
value of $38,101 on Aug. 5, 2006 and had not made any other
withdrawals during that contract year
o The prior anniversary July 1, 2006 contract value was $38,488
is calculated this way:
Withdrawal Charge Explanation
$ 0 $3,848.80 is 10% of the prior anniversary
account value withdrawn without withdrawal
charge; and
0 $10,252.20 is contract earnings in excess of
the 10% free withdrawal amount withdrawn
without withdrawal charge; and
0 $10,000 July 1, 1996 payment is an old payment
withdrawn without withdrawal charge; and
240 $8,000 Dec. 31, 2002 payment is a new payment
in its fifth contract year from receipt,
withdrawn with a 3% withdrawal charge; and
240 $6,000 Feb. 20, 2004 payment is a new payment
in its fourth contract year from receipt
withdrawn with a 4% withdrawal charge.
__________
$480
The withdrawal charge is calculated so that the total amount minus
any withdrawal charge equals the amount you request.
Waiver of withdrawal charges
There are no withdrawal charges for:
o withdrawals during the year totaling up to 10% of your prior
contract anniversary contract value;
o contract earnings - if any - in excess of the annual 10% free
withdrawal amount;
o minimum required distributions from a qualified annuity after
you reach age 70 1/2 (for those amounts required to be
distributed from this annuity only);
o contracts settled using an annuity payout plan; and
o death benefits.
<PAGE>
PAGE 23
If your contract includes a "Waiver of Withdrawal Charges" Annuity
Endorsement, we will waive withdrawal charges that are normally
assessed upon full or partial withdrawal if you provide proof
satisfactory to us that, as of the date you request the withdrawal,
you or the annuitant are confined to a hospital or nursing home and
have been for the prior 60 days.
To qualify, the nursing home must meet the following criteria:
o be licensed by an appropriate licensing agency to provide
nursing care; and
o provide 24-hour-a-day nursing services; and
o have a doctor available for emergency situations; and
o have a nurse on duty or on call at all times; and
o maintain clinical records; and
o have appropriate methods for administering drugs.
To the extent permitted by state law, this endorsement is included
in contracts issued when the owner and annuitant are under age 76
on the date that we issue the contract.
Possible group reductions: In some cases lower sales and
administrative expenses may be incurred due to the size of the
group, the average contribution and the use of group enrollment
procedures. In such cases, we may be able to reduce or eliminate
the contract administrative and withdrawal charges. However, we
expect this to occur infrequently.
Premium taxes
Certain state and local governments impose premium taxes that may
reach to 3.5%. These taxes are dependent upon the state of
residence or the state in which the contract was sold. In some
cases, premium taxes are deducted from your purchase payments
before they are allocated. In other cases, the deduction is made
when you fully withdraw your contract or when annuity payouts
begin.
Valuing your investment
Here is how your fixed account and variable subaccounts are valued:
Fixed account: The amounts allocated to the fixed account are
valued directly in dollars and equal the sum of your purchase
payments and transfer amounts plus interest earned, less any
amounts withdrawn or transferred and any contract administrative
charge.
Variable subaccounts: Amounts allocated to the variable
subaccounts are converted into accumulation units. Each time you
make a purchase payment or transfer amounts into one of the
variable subaccounts, a certain number of accumulation units are
credited to your contract for that subaccount. Conversely, each
time you take a partial withdrawal, transfer amounts out of a
variable subaccount, or are assessed a contract administrative
charge, a certain number of accumulation units are subtracted from
your contract.
<PAGE>
PAGE 24
The accumulation units are the true measure of investment value in
each subaccount during the accumulation period. They are related
to, but not the same as, the net asset value of the underlying
fund.
The dollar value of each accumulation unit can rise or fall daily
depending on the performance of the underlying mutual fund and on
certain fund expenses. Here is how unit values are calculated:
Number of units
To calculate the number of accumulation units for a particular
subaccount, we divide your investment, after deduction of any
premium taxes, by the current accumulation unit value.
Accumulation unit value
The current accumulation unit value for each variable subaccount
equals the last value times the subaccount's current net investment
factor.
Net investment factor
o Determined each business day by adding the underlying mutual
fund's current net asset value per share plus per-share amount
of any current dividend or capital gain distribution; then
o dividing that sum by the previous net asset value per share;
and
o subtracting the percentage factor representing the mortality
and expense risk fee and the variable account administrative
charge from the result.
Because the net asset value of the underlying mutual fund may
fluctuate, the accumulation unit value may increase or decrease.
You bear this investment risk in a variable subaccount.
Factors that affect variable subaccount accumulation units
Accumulation units may change in two ways; in number and in value.
Here are the factors that influence those changes:
The number of accumulation units you own may fluctuate due to:
o additional purchase payments allocated to the variable
subaccounts;
o transfers into or out of the variable subaccount(s);
o partial withdrawals;
o withdrawal charges; and/or
o contract administrative charges.
Accumulation unit values may fluctuate due to:
o changes in underlying mutual fund(s) net asset value;
o dividends distributed to the variable subaccount(s);
o capital gains or losses of underlying mutual funds;
o mutual fund operating expenses;
o mortality and expense risk fees; and/or
o variable account administrative charges.
<PAGE>
PAGE 25
Making the most of your annuity
Automated dollar-cost averaging*
You can use automated transfers to take advantage of dollar-cost
averaging (investing a fixed amount at regular intervals). For
example, you might have a set amount transferred monthly from a
relatively conservative variable subaccount to a more aggressive
one, or to several others.
This systematic approach can help you benefit from fluctuations in
accumulation unit values caused by fluctuations in the market
value(s) of the underlying mutual fund(s). Since you invest the
same amount each period, you automatically acquire more units when
the market value falls, fewer units when it rises. The potential
effect is to lower your average cost per unit. For specific
features contact your agent.
<TABLE>
<CAPTION>
How dollar-cost averaging works
Month Amount Accumulation Number of units
invested unit value purchased
<S> <C> <C> <C> <C>
By investing an Jan $100 $20 5.00
equal number of
dollars each month.... Feb 100 18 5.56
March 100 17 5.88
you automatically April 100 15 6.67
buy more units
when the per unit May 100 16 6.25
market price is low....
June 100 18 5.56
July 100 17 5.88
Aug 100 19 5.26
and fewer units Sept 100 21 4.76
when the per unit
market price is Oct 100 20 5.00
high.
</TABLE>
You have paid an average price of only $17.91 per unit over the 10
months, while the average market price actually was $18.10.
Dollar-cost averaging does not guarantee that any variable
subaccount will gain in value, nor will it protect against a
decline in value if market prices fall. However, if you can
continue to invest regularly throughout changing market conditions,
it can be an effective strategy to help meet your long term goals.
* Some restrictions may apply.
Transferring money between subaccounts
You may transfer money from any one subaccount, or the fixed
account, to another before the annuity payouts begin. Certain
restrictions apply to transfers involving the fixed account. If we
receive your request before the close of business, we will process
it that day. Requests received after the close of business will be
processed the next business day. There is no charge for transfers.
Before making a transfer, you should consider the risks involved in
switching investments.<PAGE>
PAGE 26
We may suspend or modify transfer privileges at any time. The
right to transfer contract values between the subaccounts is
subject to modification if we determine, in our sole discretion,
that the exercise of that right by one or more contract owners is,
or would be, to the disadvantage of other contract owners. Any
modification could be applied to transfers to or from some or all
of the subaccounts. These modifications could include, but not be
limited to, the requirement of a minimum time period between each
transfer, not accepting transfer requests of an agent acting under
a power of attorney on behalf of more than one contract owner or
limiting the dollar amount that may be transferred between the
subaccounts and the fixed account by a contract owner at any one
time. We may apply these modifications or restrictions in any
manner reasonably designed to prevent any use of the transfer right
we consider to be to the disadvantage of other contract owners.
(For information on transfers after annuity payouts begin, see "The
annuity payout period.")
Transfer policies
o You may transfer contract values between the variable
subaccounts or from the subaccount(s) to the fixed account at
any time. However, if you have made a transfer from the fixed
account to the subaccount(s), you may not make a transfer from
any subaccount back to the fixed account for six months
following that transfer.
o You may transfer contract values from the fixed account to the
variable subaccount(s) on or within 30 days before or after
the contract anniversary (except for automated transfers,
which can be set up for transfer periods of your choosing
subject to certain minimums).
o If we receive your request on or within 30 days before or
after the contract anniversary date, the transfer from the
fixed account to the variable subaccount(s) will be effective
on the day we receive it.
o We will not accept requests for transfers from the fixed
account at any other time.
o Once annuity payouts begin no transfers may be made to or from
the fixed account, but transfers may be made once per contract
year among the variable subaccounts.
Two ways to request a transfer or a withdrawal
1 By letter
Send your name, account number, Social Security Number or Taxpayer
Identification Number and signed request for a transfer or
withdrawal to:
Regular mail:
American Enterprise Life Insurance Company
80 South Eighth Street
P.O. Box 534
Minneapolis, MN 55440-0534<PAGE>
PAGE 27
Express mail:
American Enterprise Life Insurance Company
Attention: Unit 829
80 South Eighth Street
Minneapolis, MN 55402
Minimum amount
Mail transfers: $500 or entire variable subaccount or fixed
account balance
Mail withdrawals: $500 or entire variable subaccount or fixed
account balance
Maximum amount
Mail transfers: None (up to contract value)
Mail withdrawals: None (up to contract value)
2 By automated transfers and automated partial withdrawals
Your agent can help you set up automated transfers among your
accounts or partial withdrawals from the accounts.
You can start or stop this service by written request or other
method acceptable to American Enterprise Life. You must allow 30
days for American Enterprise Life to change any instructions that
are currently in place.
o Automated transfers may not exceed an amount that, if
continued, would deplete the fixed account or subaccount(s)
from which you are transferring within 24 months.
o Automated transfers and automated partial withdrawals are
subject to all of the contract provisions and terms, including
transfer of contract values between accounts. Automated
withdrawals may be restricted by applicable law under some
contracts.
o Automated partial withdrawals may result in IRS taxes and
penalties on all or part of the amount withdrawn.
Minimum amount
Automated transfers or withdrawals: $100 monthly/$250 quarterly
Maximum amount
Automated transfers or withdrawals: None (except for automated
transfers from the fixed
account)
Withdrawals from your contract
As owner, you may withdraw all or part of your contract at any time
before annuity payouts begin by sending a written request to
American Enterprise Life. For total withdrawals we will compute
the value of your contract at the close of business after we
receive your request. We may ask you to return the contract. You
may have to pay withdrawal charges (see "Withdrawal charge") and
IRS taxes and penalties (see "Taxes"). No withdrawals may be made
after annuity payouts begin.
<PAGE>
PAGE 28
Withdrawal policies
If you have a balance in more than one account and request a
partial withdrawal, we will withdraw money from all your accounts
in the same proportion as your value in each account correlates to
your total contract value, unless you request otherwise.
Receiving payment when you request a withdrawal
By regular or express mail:
o Payable to owner.
o Normally mailed to address of record within seven days after
receiving your request. However, we may postpone the payment
if:
-the withdrawal amount includes a purchase payment check that
has not cleared;
-the NYSE is closed, except for normal holiday and weekend
closings;
-trading on the NYSE is restricted, according to SEC rules;
-an emergency, as defined by SEC rules, makes it impractical
to sell securities or value the net assets of the accounts; or
-the SEC permits us to delay payment for the protection of
security holders.
Changing ownership
You may change ownership of your nonqualified annuity at any time
by filing a change of ownership with us at our Minneapolis
administrative office. The change will become binding upon us when
we receive and record it. We will honor any change of ownership
request believed to be authentic and will use reasonable procedures
to confirm that it is. If these procedures are followed, we take
no responsibility for the validity of the change.
If you have a nonqualified annuity, you may lose your tax
advantages by transferring, assigning or pledging any part of it.
(See "Taxes.")
If you have a qualified annuity, you may not sell, assign,
transfer, discount or pledge your contract as collateral for a
loan, or as security for the performance of an obligation or for
any other purpose to any person except American Enterprise Life.
However, if the owner is a trust or custodian, or an employer
acting in a similar capacity, ownership of a contract may be
transferred to the annuitant.
Benefits in case of death
If you or the annuitant dies (or, for qualified annuities, if the
annuitant dies) before annuity payouts begin, we will pay the
beneficiary as follows:
<PAGE>
PAGE 29
For contracts where both the owner and annuitant were 75 or younger
on the date the contract was issued and if all withdrawals you have
made from this contract have been without withdrawal charges, the
beneficiary receives the greater of:
1. the contract value; or
2. the total purchase payments paid less any amounts withdrawn;
or
3. on or after the fifth contract anniversary, the death benefit
as of the most recent fifth contract anniversary adjusted by
adding any purchase payments made since that most recent fifth
contract anniversary and by subtracting any amounts withdrawn
since that most recent fifth contract anniversary.
For contracts where both the owner and annuitant were 75 or younger
on the date the contract was issued and you have made withdrawals
subject to withdrawal charges, the beneficiary receives the
contract value.
For contracts where either the owner or annuitant were 76 or older
on the date the contract was issued, the beneficiary receives the
contract value.
If your spouse is sole beneficiary under a nonqualified annuity and
you die before the retirement date, your spouse may keep the
annuity as owner. To do this your spouse must, within 60 days
after we receive proof of death, give us written instructions to
keep the contract in force.
Under a qualified annuity, if the annuitant dies before reaching
age 70 1/2 and before the retirement date, and the spouse is the
only beneficiary, the spouse may keep the annuity in force until
the date on which the annuitant would have reached age 70 1/2 or
such other date permitted by the Code. To do this, the spouse must
give us written instructions within 60 days after we receive proof
of death.
Payments: We will pay the beneficiary in a single sum unless you
have given us other written instructions, or the beneficiary may
receive payouts under any annuity payout plan available under this
contract if:
o the beneficiary asks us in writing within 60 days after we
receive proof of death;
o payouts begin no later than one year after death; and
o the payout period does not extend beyond the beneficiary's life
or life expectancy.
When paying the beneficiary, we will determine the contract's value
at the next close of business after our death claim requirements
are fulfilled. Interest, if any, will be paid from the date of
death at a rate no less than required by law. We will mail payment
to the beneficiary within seven days after our death claim
requirements are fulfilled. (See "Taxes.")
<PAGE>
PAGE 30
The annuity payout period
As owner of the contract, you have the right to decide how and to
whom annuity payouts will be made starting at the retirement date.
You may select one of the annuity payout plans outlined below, or
we will mutually agree on other payout arrangements. The amount
available for payouts under the plan you select is the contract
value on your retirement date. No withdrawal charges are deducted
under the payout plans listed below.
You also decide whether annuity payouts are to be made on a fixed
or variable basis, or a combination of fixed and variable. Amounts
of fixed and variable payouts depend on:
o the annuity payout plan you select;
o the annuitant's age and, in most cases, sex;
o the annuity table in the contract; and
o the amounts you allocated to the account(s) at settlement.
In addition, for variable payouts only, amounts depend on the
investment performance of the subaccount(s) you select. These
payouts will vary from month to month because the performance of
the underlying mutual funds will fluctuate. (In the case of fixed
annuities, payouts remain the same from month to month.)
For information with respect to transfers between accounts after
annuity payouts begin, see "Transfer policies."
Annuity payout plans
You may choose any one of these annuity payout plans by giving us
written instructions at least 30 days before contract values are to
be used to purchase the payout plan:
o Plan A - Life annuity - no refund: Monthly payouts are made
until the annuitant's death. Payouts end with the last payout
before the annuitant's death; no further payouts will be made.
This means that if the annuitant dies after only one monthly payout
has been made, no more payouts will be made.
o Plan B - Life annuity with five, 10 or 15 years certain: Monthly
payouts are made for a guaranteed payout period of five, 10 or 15
years that the annuitant elects. This election will determine the
length of the payout period to the beneficiary if the annuitant
should die before the elected period has expired. The guaranteed
payout period is calculated from the retirement date. If the
annuitant outlives the elected guaranteed payout period, payouts
will continue until the annuitant's death.
o Plan C - Life annuity - installment refund: Monthly payouts are
made until the annuitant's death, with our guarantee that payouts
will continue for some period of time. Payouts will be made for at
least the number of months determined by dividing the amount
applied under this option by the first monthly payout, whether or
not the annuitant is living.
<PAGE>
PAGE 31
o Plan D - Joint and last survivor life annuity - no refund:
Monthly payouts are made to the annuitant and a joint annuitant
while both are living. If either annuitant dies, monthly payouts
continue at the full amount until the death of the surviving
annuitant. Payouts end with the death of the second annuitant.
o Plan E - Payouts for a specified period (available as a fixed
payout only): Monthly payouts are made for a specific payout
period of 10 to 30 years chosen by the annuitant. Payouts will be
made only for the number of years specified whether the annuitant
is living or not. Depending on the time period selected, it is
foreseeable that an annuitant can outlive the payout period
selected. In addition, a 10% IRS penalty tax could apply under
this payout plan. (See "Taxes.")
Restrictions for some qualified plans: If you purchased a
qualified annuity, you must select a payout plan that provides for
payouts:
o over the life of the annuitant;
o over the joint lives of the annuitant and a designated
beneficiary;
o for a period not exceeding the life expectancy of the
annuitant; or
o for a period not exceeding the joint life expectancies
of the annuitant and a designated beneficiary.
If we do not receive instructions: You must give us written
instructions for the annuity payouts at least 30 days before the
annuitant's retirement date. If you do not, we will make payouts
under Plan B, with 120 monthly payouts guaranteed.
If monthly payouts would be less than $20: We will calculate the
amount of monthly payouts at the time the contract value is used to
purchase a payout plan. If the calculations show that monthly
payouts would be less than $20, we have the right to pay the
contract value to the owner in a lump sum or to change the
frequency of the payouts.
Death after annuity payouts begin
If you or the annuitant dies after annuity payouts begin, any
amount payable to the beneficiary will be provided in the annuity
payout plan in effect.
Taxes
Generally, under current law, any increase in your contract value
is taxable to you only when you receive a payout or withdrawal.
(However, see detailed discussion below.) Any portion of the
annuity payouts and any withdrawals you request that represent
ordinary income are normally taxable. You will receive a 1099 tax
information form for any year in which a taxable distribution was
made.
<PAGE>
PAGE 32
Annuity payouts under nonqualified annuities: A portion of each
payout will be ordinary income and subject to tax, and a portion of
each payout will be considered a return of part of your investment
and will not be taxed. All amounts received after your investment
in the annuity is fully recovered will be subject to tax.
Tax law requires that all nonqualified deferred annuity contracts
issued by the same company to the same owner during a calendar year
are to be taxed as a single, unified contract when distributions
are taken from any one of such contracts.
Annuity payouts under qualified annuities: Under a qualified
annuity, the entire payout generally will be includable as ordinary
income and subject to tax except to the extent that contributions
were made with after-tax dollars. If you or your employer invested
in your contract with pre-tax dollars as part of a qualified
retirement plan, such amounts are not considered to be part of your
investment in the contract and will be taxed when paid to you.
Withdrawals: If you withdraw part or all of your contract before
your annuity payouts begin, your withdrawal payment will be taxed
to the extent that the value of your contract immediately before
the withdrawal exceeds your investment. You also may have to pay a
10% IRS penalty for withdrawals before reaching age 59 1/2. For
qualified annuities, other penalties may apply if you make
withdrawals from your annuity before your plan specifies that you
can receive payouts.
Death benefits to beneficiaries: The death benefit under an
annuity is not tax-exempt. Any amount received by the beneficiary
that represents previously deferred earnings within the contract,
is taxable as ordinary income to the beneficiary in the year(s) he
or she receives the payments.
Annuities owned by corporations, partnerships or trusts: Any
annual increase in the value of annuities held by such entities
generally will be treated as ordinary income received during that
year. This provision is effective for purchase payments made after
Feb. 28, 1986. However, if the trust was set up for the benefit of
a natural person only, the income will continue to be tax-deferred.
Penalties: If you receive amounts from your contract before
reaching age 59 1/2, you may have to pay a 10% IRS penalty on the
amount includable in your ordinary income. However, this penalty
will not apply to any amount received by you or your beneficiary:
o because of your death;
o because you become disabled (as defined in the Code);
o if the distribution is part of a series of substantially equal
periodic payments, made at least annually, over your life or
life expectancy (or joint lives or life expectancies of you and
your beneficiary); or
o if it is allocable to an investment before Aug. 14, 1982 (except
for qualified annuities).
For a qualified annuity, other penalties or exceptions may apply if
you make withdrawals from your annuity before your plan specifies
that payouts can be made.<PAGE>
PAGE 33
Withholding, generally: If you receive all or part of the contract
value from an annuity, withholding may be imposed against the
taxable income portion of the payment. Any withholding that is
done represents a prepayment of your tax due for the year. You
take credit for such amounts on the annual tax return that you
file.
If the payment is part of an annuity payout plan, the amount of
withholding generally is computed using payroll tables. You can
provide us with a statement of how many exemptions to use in
calculating the withholding. As long as you've provided us with a
valid Social Security Number or Taxpayer Identification Number, you
can elect not to have any withholding occur.
If the distribution is any other type of payment (such as a partial
or full withdrawal) withholding is computed using 10% of the
taxable portion. Similar to above, as long as you've provided us
with a valid Social Security Number or Taxpayer Identification
Number, you can elect not to have this withholding occur.
Some states also impose withholding requirements similar to the
federal withholding described above. If this should be the case,
any payment from which federal withholding is deducted may also
have state withholding deducted. The withholding requirements may
differ if payment is being made to a non-U.S. citizen or if the
payment is being delivered outside the United States.
Transfer of ownership of a nonqualified annuity: If you make such
a transfer without receiving adequate consideration, the transfer
is considered a gift, and also may be considered a withdrawal for
federal income tax purposes. If the gift is a currently taxable
event, the amount of deferred earnings at the time of the transfer
will be taxed to the original owner, who also may be subject to a
10% IRS penalty as discussed earlier. In this case, the new
owner's investment in the annuity will be the value of the annuity
at the time of the transfer.
Collateral assignment of a nonqualified annuity: If you
collaterally assign or pledge your contract, earnings on purchase
payments you made after Aug. 13, 1982 will be taxed to you like a
withdrawal.
Important: Our discussion of federal tax laws is based upon our
understanding of these laws as they are currently interpreted.
Federal tax laws or current interpretations of them may change.
For this reason and because tax consequences are complex and highly
individual and cannot always be anticipated, you should consult a
tax advisor if you have any questions about taxation of your
contract.
Tax qualification
The contract is intended to qualify as an annuity for federal
income tax purposes. To that end, the provisions of the contract
are to be interpreted to ensure or maintain such tax qualification,
<PAGE>
PAGE 34
notwithstanding any other provisions of the contract. We reserve
the right to amend the contract to reflect any clarifications that
may be needed or are appropriate to maintain such qualification or
to conform the contract to any applicable changes in the tax
qualification requirements. We will send you a copy of any such
amendments.
Voting rights
As contract owner with investments in the variable subaccount(s),
you may vote on important mutual fund policies until annuity
payouts begin. Once they begin, the person receiving them has
voting rights. We will vote fund shares according to the
instructions of the person with voting rights.
Before annuity payouts begin, the number of votes you have is
determined by applying your percentage interest in each variable
subaccount to the total number of votes allowed to the subaccount.
After annuity payouts begin, the number of votes you have is equal
to:
o the reserve held in each subaccount for your contract, divided
by
o the net asset value of one share of the applicable underlying
mutual fund.
As we make annuity payouts, the reserve for the contract decreases;
therefore, the number of votes also will decrease.
We calculate votes separately for each account. Notice of these
meetings, proxy materials and a statement of the number of votes
to which the voter is entitled, will be sent.
We will vote shares for which we have not received instructions in
the same proportion as the votes for which we have received
instructions. We also will vote the shares for which we have
voting rights in the same proportion as the votes for which we have
received instructions.
Substitution of investments
If shares of any fund should not be available for purchase by the
appropriate variable subaccount or if, in the judgment of American
Enterprise Life's Management, further investment in such shares is
no longer appropriate in view of the purposes of the subaccount,
investment in the subaccount may be discontinued or another
registered open-end management investment company may be
substituted for fund shares held in the subaccounts if American
Enterprise Life believes it would be in the best interest of
persons having voting rights under the contract. The variable
account may be operated as a management company under the 1940 Act
or it may be deregistered under this Act if the registration is no
longer required. In the event of any such substitution or change,
American Enterprise Life, without the consent or approval of the
owners, may amend the contract and take whatever action is
necessary and appropriate. However, no such substitution or change
<PAGE>
PAGE 35
will be made without the necessary approval of the SEC and state
insurance departments. American Enterprise Life will notify owners
of any substitution or change.
Distribution of the contracts
The contracts will be distributed by banks and financial
institutions either directly or through a network of third-party
marketers. American Express Financial Advisors Inc., the principal
underwriter for the variable account, will pay commissions for the
distribution of the contracts to the broker-dealers of the banks or
financial institutions or the broker-dealers of the third-party
marketers who have entered into distribution agreements with
American Express Financial Advisors. These commissions will not be
more than 7% of purchase payments received on the contracts.
From time to time, American Enterprise Life may pay or permit other
promotional incentives, in cash or credit or other compensation.
About American Enterprise Life
The AEL Personal PortfolioSM is issued by American Enterprise Life.
American Enterprise Life is a wholly owned subsidiary of IDS Life,
which is a wholly owned subsidiary of American Express Financial
Corporation. American Express Financial Corporation is a wholly
owned subsidiary of American Express Company. American Express
Company is a financial services company principally engaged through
subsidiaries (in addition to American Express Financial
Corporation) in travel related services, investment services and
international banking services.
American Enterprise Life is a stock life insurance company
organized in 1981 under the laws of the state of Indiana. Its
administrative office is located at 80 South Eighth Street,
Minneapolis, MN 55402. Its statutory address is 100 Capitol Center
South, 201 North Illinois Street, Indianapolis, IN 46204. American
Enterprise Life is licensed in the state of Indiana and it conducts
a conventional life insurance business.
American Express Financial Advisors Inc. is the principal
underwriter for the variable account. Its home office is IDS Tower
10, Minneapolis, MN 55440-0010. American Express Financial
Advisors is registered with the SEC under the Securities Exchange
Act of 1934 as a broker-dealer and is a member of the National
Association of Securities Dealers, Inc. American Express Financial
Advisors is a wholly owned subsidiary of American Express Financial
Corporation.
The American Express Financial Corporation family of companies
offers not only insurance and annuities, but also mutual funds,
investment certificates and a broad range of financial management
services.
Other subsidiaries provide investment management and related
services for pension, profit-sharing, employee savings and
endowment funds of businesses and institutions.
<PAGE>
PAGE 36
Regular and special reports
Services
To help you track and evaluate the performance of your annuity,
American Enterprise Life provides:
Quarterly statements showing the value of your investment.
Annual reports containing required information on the annuity and
its underlying investments.
Table of contents of the Statement of Additional Information
Performance information...............................
Calculating annuity payouts...........................
Rating agencies.......................................
Principal underwriter.................................
Independent auditors..................................
Mortality and expense risk fee........................
Saving for retirement.................................
Prospectus............................................
Financial statements -
American Enterprise Variable Annuity
Account..........................................
American Enterprise Life Insurance
Company..........................................
___________________________________________________________________
Please check the appropriate box to receive a copy of the Statement
of Additional Information for:
____ AEL Personal PortfolioSM
____ IDS Life Retirement Annuity Mutual Funds
____ The OCC Accumulation Trust
____ The Putnam Capital Manager Trust
____ GT Global Variable Investment Funds
Mail your request to:
American Enterprise Life Insurance Company
80 South Eighth Street
P.O. Box 534
Minneapolis, MN 55440-0534
American Enterprise Life will mail your request to:
Your name _____________________________________________________
Address _______________________________________________________
City __________________________ State ____________ Zip ________
<PAGE>
PAGE 37
STATEMENT OF ADDITIONAL INFORMATION
for
AEL PERSONAL PORTFOLIOSM
AMERICAN ENTERPRISE VARIABLE ANNUITY ACCOUNT
____________________, 1996
American Enterprise Variable Annuity Account is a separate account
established and maintained by American Enterprise Life Insurance
Company (American Enterprise Life).
This Statement of Additional Information (SAI), dated ___________,
1996, is not a prospectus. It should be read together with the
Account's prospectus, dated _____________, 1996, which may be
obtained from your agent, or by writing or calling American
Enterprise Life Insurance Company at the address or telephone
number below.
American Enterprise Life Insurance Company
Administrative Offices
80 South Eighth Street
P.O. Box 534
Minneapolis, MN 55440-0534
(612) 671-7700
<PAGE>
PAGE 38
TABLE OF CONTENTS
Performance Information......................................
Calculating Annuity Payouts..................................
Rating Agencies..............................................
Principal Underwriter........................................
Independent Auditors.........................................
Mortality and Expense Risk Fee...............................
Saving for Retirement........................................
Prospectus...................................................
<PAGE>
PAGE 39
PERFORMANCE INFORMATION
The following performance figures are calculated on the basis of
historical performance of the funds. The performance figures
relating to these funds assume that the contract was in existence
prior to January 12, 1995, which it was not. Performance figures
are calculated on the basis of historical performance of the funds.
Before the subaccounts began investing in these funds, the figures
show what the subaccount performance would have been if these
subaccounts had existed during the illustrated periods. Once these
subaccounts began investing in these funds, actual values are used
for the calculations.
Calculation of Yield for the Subaccount investing in IDS Life
Moneyshare Fund.
Simple yield for the subaccount investing in the IDS Life
Moneyshare Fund will be based on the: (a) change in the value of a
hypothetical investment (exclusive of capital changes) at the
beginning of a seven-day period for which yield is to be quoted;
(b) subtracting a pro rata share of subaccount expenses accrued
over the seven-day period; (c) dividing the difference by the value
of the subaccount at the beginning of the period to obtain the base
period return; and (d) annualizing the results (i.e., multiplying
the base period return by 365/7).
The value of the hypothetical subaccount includes the amount of any
declared dividends, the value of any shares purchased with any
dividend paid during the period and any dividends declared for such
shares. The variable subaccount's yield does not include any
realized or unrealized gains or losses, nor does it include the
effect of any applicable surrender charge.
Calculation of compound yield begins with the same base period
return used in the calculation of yield, which is then annualized
to reflect compounding according to the following formula:
Compound Yield = [(Base Period Return + 1) 365/7 ] -1
Annualized Yield based on Seven-Day Period ended
_____________________
Subaccount investing in: Simple Yield Compound Yield
IDS Life Moneyshare Fund % %
Calculation of Yield for the Subaccount investing in IDS Life
Special Income Fund.
For the subaccount investing in the IDS Life Special Income Fund
quotations of yield will be based on all investment income earned
during a particular 30-day period, less expenses accrued during the
period (net investment income) and will be computed by dividing net
<PAGE>
PAGE 40
investment income per accumulation unit by the value of an
accumulation unit on the last day of the period, according to the
following formula:
YIELD = 2[(a-b + 1)6 - 1]
cd
where: a = dividends and investment income earned during the
period.
b = expenses accrued for the period (net of
reimbursements).
c = the average daily number of accumulation units
outstanding during the period that were entitled to
receive dividends.
d = the maximum offering price per accumulation unit on
the last day of the period.
Yield on the subaccount is earned from the increase in the net
asset value of shares of the fund in which the subaccount invests
and from dividends declared and paid by the fund, which are
automatically invested in shares of the fund.
Annualized yield based on 30-Day Period ended _______________
Subaccount investing in: Yield
IDS Life Special Income %
Calculation of average annual total return
Quotations of average annual total return for a subaccount will be
expressed in terms of the average annual compounded rate of return
of a hypothetical investment in the annuity contract over a period
of one, five and 10 years (or, if less, up to the life of the
account), calculated according to the following formula:
P(1+T)n = ERV
where: P = a hypothetical initial payment of $1,000.
T = average annual total return.
n = number of years.
ERV = Ending Redeemable Value of a hypothetical $1,000
payment made at the beginning of the one, five, or
ten year (or other) period at the end of the one,
five, or ten year (or other) period (or fractional
portion thereof).
Subaccount total return figures reflect the deduction of the
contract administrative charge, variable account administrative
charge and mortality and expense risk fee. Performance figures
will be shown with the deduction of the applicable withdrawal
charge.
<PAGE>
PAGE 41
Average Annual total Return For Period Ended _____________
<TABLE>
<CAPTION>
Average Annual Total Return with Withdrawal
Since
Subaccount investing in: 1 Year 5 Year 10 Year Inception
<S> <C> <C> <C> <C>
IDS LIFE
Aggressive Growth Fund (1/92)*
Capital Resource Fund (10/81)
International Equity Fund (1/92)
Managed Fund (4/86)
Moneyshare Fund (10/81)
Special Income Fund (10/81)
Since
1 Year 5 Year 10 Year Inception
OCC ACCUMULATION TRUST
Managed Portfolio (8/88)
GT GLOBAL
Variable Latin America Fund (2/93)
Variable New Pacific Fund (2/93)
PCM
Diversified Income Fund (9/93)
Growth & Income Fund (2/88)
High Yield Fund (2/88)
New Opportunities Fund (5/94)
Average Annual Total Return without Withdrawal
Since
Subaccount Investing in: 1 Year 5 Year 10 Year Inception
IDS Life
Aggressive Growth Fund (1/92)*
Capital Resource Fund (10/81)
International Equity Fund (1/92)
Managed Fund (4/86)
Moneyshare Fund (10/81)
Special Income Fund (10/81)
OCC ACCUMULATION TRUST
Managed Portfolio (8/88)
GT GLOBAL
Variable Latin America (2/93)
Variable New Pacific Fund (2/93)
PCM
Diversified Income Fund (9/93)
Growth & Income Fund (2/88)
High Yield Fund (2/88)
New Opportunities Fund (5/94)
*inception dates of the funds are shown in parentheses.
</TABLE>
Aggregate Total Return
Aggregate total return represents the cumulative change in value of
an investment for a given period (reflecting change in a
subaccount's accumulation unit value) and is computed by the
following formula:
ERV - P
P
<PAGE>
PAGE 42
where: P = a hypothetical initial payment of $1,000.
ERV = Ending Redeemable Value of a hypothetical $1,000
payment made at the beginning of the one, five, or
ten year (or other) period at the end of the one,
five, or ten year (or other) period (or fractional
portion thereof).
The Securities and Exchange Commission (SEC) requires that an
assumption be made that the contract owner withdraws the entire
contract at the end of the one, five and ten year periods (or, if
less, up to the life of the subaccount) for which performance is
required to be calculated. In addition, performance figures may be
shown without the deduction of a withdrawal charge.
Subaccount total return figures reflect the deduction of the
contract administrative charge and mortality and expense risk fee.
Performance of the subaccount may be quoted or compared to
rankings, yields, or returns as published or prepared by
independent rating or statistical services or publishers or
publications such as Barron's, Business Week, Forbes, Fortune,
Institutional Investor, Investor's Daily, Kiplinger's Personal
Finance, Money, Morningstar Mutual Fund Values, Mutual Fund
Forecaster, The New York Times, Stranger's Investment Advisor, USA
Today, U.S. News & World Report and The Wall Street Journal.
CALCULATING ANNUITY PAYOUTS
The Variable Account
The following calculations are done separately for each of the
subaccounts of the variable account. The separate monthly payouts,
added together, make up your total variable annuity payout.
Initial Payout: To compute your first monthly payment, we:
o determine the dollar value of your annuity as of the valuation
date seven days before the retirement date and then deduct any
applicable premium tax.
o apply the result to the annuity table contained in the contract
or another table at least as favorable. The annuity table shows
the amount of the first monthly payment for each $1,000 of value
which depends on factors built into the table, as described below.
Annuity Units: The value of your subaccount is then converted to
annuity units. To compute the number credited to you, we divide
the first monthly payment by the annuity unit value (see below) on
the valuation date on (or next day preceding) the seventh calendar
day before the retirement date. The number of units in your
subaccount is fixed. The value of the units fluctuates with the
performance of the underlying mutual fund.
<PAGE>
PAGE 43
Subsequent Payouts: To compute later payouts, we multiply:
o the annuity unit value on the valuation date on or immediately
preceding the seventh calendar day before the payout is due; by
o the fixed number of annuity units credited to you.
Annuity Table: The table shows the amount of the first monthly
payment for each $1,000 of contract value according to the age and,
when applicable, the sex of the annuitant. (Where required by law,
we will use a unisex table of settlement rates.) The table assumes
that the contract value is invested at the beginning of the annuity
payout period and earns a 5% rate of return, which is reinvested
and helps to support future payouts.
Annuity Unit Values: This value was originally set at $1 for each
subaccount. To calculate later value we multiply the last annuity
value by the product of:
o the net investment factor; and
o the neutralizing factor. The purpose of the neutralizing factor
is to offset the effect of the assumed investment rate built into
the annuity table. With an assumed investment rate of 5%, the
neutralizing factor is 0.999866 for a one day valuation period.
Net Investment Factor:
o Determined each business day by adding the underlying mutual
fund's current net asset value per share plus per share amount of
any current dividend or capital gain distribution; then
o dividing that sum by the previous net asset value per share; and
o subtracting the percentage factor representing the mortality and
expense risk fee from the result.
Because the net asset value of the underlying mutual fund may
fluctuate, the net investment factor may be greater or less than
one, and the accumulation unit value may increase or decrease. You
bear this investment risk in a variable subaccount.
The Fixed Account
Your fixed annuity payout amounts are guaranteed. Once calculated,
your payout will remain the same and never change. To calculate
your annuity payouts we:
o take the value of your fixed account at the retirement date or
the date you have selected to begin receiving your annuity payouts;
then
o using an annuity table we apply the value according to the
annuity payout plan you select; and
o the annuity payout table we use will be the one in effect at the
time you choose to begin your annuity payouts. The table will be
equal to or greater than the table in your contract.
<PAGE>
PAGE 44
RATING AGENCIES
The following chart reflects the ratings given to American
Enterprise Life by independent rating agencies. These agencies
evaluate the financial soundness and claims-paying ability of
insurance companies based on a number of different factors. This
information does not relate to the management or performance of the
variable subaccounts of the AEL Personal PortfolioSM. This
information relates only to the fixed account and reflects American
Enterprise Life's ability to make annuity payouts and to pay death
benefits and other distributions from the annuity.
Rating agency Rating
A.M. Best A+
(Superior)
Duff & Phelps AAA
Moody's Aa2
PRINCIPAL UNDERWRITER
The principal underwriter for the accounts is American Express
Financial Advisors Inc. which offers the variable contracts on a
continuous basis.
INDEPENDENT AUDITORS
To be filed by Amendment.
MORTALITY AND EXPENSE RISK FEE
American Enterprise Life has represented to the SEC that:
American Enterprise Life has reviewed publicly available
information regarding products of other companies. Based upon this
review, American Enterprise Life has concluded that the mortality
and expense risk fee is within the range of charges determined by
industry practice. American Enterprise Life will maintain at its
administrative office, and make available on request of the SEC or
its staff, a memorandum setting forth in detail the variable
products analyzed and the methodology, and results of, its
comparative review.
American Enterprise Life has concluded that there is a reasonable
likelihood that the proposed distribution financing arrangements
made with respect to the contracts will benefit the variable
account and investors in the contracts. The basis for such
conclusion is set forth in a memorandum which will be made
available to the SEC or its staff on request.
<PAGE>
PAGE 45
SAVING FOR RETIREMENT
You may have to save more for retirement because the average person
lives 17 years in retirement. Social security and pensions will
Znot cover your expenses in retirement. Sixty cents of every
retirement dollar must come from your personal savings.
Sources: Social Security Administration, U.S. Department of
Health and Human Services.
PROSPECTUS
The prospectus dated ______________, 1996, is hereby incorporated
in this SAI by reference.
<PAGE>
PAGE 46
PART C.
Item 24. Financial Statements and Exhibits
(a) To be filed by Amendment.
(b) Exhibits:
1. Resolution of the Executive Committee of the Board of
Directors of American Enterprise Life establishing the
American Enterprise Variable Annuity Account dated July 15,
1987, filed electronically as Exhibit 1 to the Initial
Registration Statement to Registration Statement No. 33-54471,
filed on or about July 5, 1994 is incorporated herein by
reference.
2. Not applicable.
3.1 Form of Variable Annuity and Life Insurance Distribution
Agreement, filed electronically as Exhibit 3.1 to Pre-
Effective Amendment No. 1 to Registration Statement No. 33-
54471 is incorporated herein by reference.
3.2 Form of Managing General Agent Agreement, filed electronically
as Exhibit 3.2 to Pre-Effective Amendment No. 1 to
Registration Statement No. 33-54471 is incorporated herein by
reference.
4.1 Form of Deferred Annuity Contract (form 34560), filed
electronically as Exhibit 4.1 to the Initial Registration
Statement to Registration Statement No. 33-54471, filed on or
about July 5, 1994 is incorporated herein by reference.
4.2 Form of Tax-Qualified Endorsement (form 34563), filed
electronically as Exhibit 4.2 to the Initial Registration
Statement to Registration Statement No. 33-54471, filed on or
about July 5, 1994 is incorporated herein by reference.
4.3 Form of Annuity Endorsement (form 34562), filed electronically
as Exhibit 4.3 to the Initial Registration Statement to
Registration Statement No. 33-54471, filed on or about July 5,
1994 is incorporated herein by reference.
5.1 Form of Application for American Enterprise Life Variable
Annuity (form 34561), filed electronically as Exhibit 5.1 to
the Initial Registration Statement to Registration Statement
No. 33-54471, filed on or about July 5, 1994 is incorporated
herein by reference.
6.1 Amendment and Restatement of Articles of Incorporation of
American Enterprise Life dated July 29, 1986, filed
electronically as Exhibit 6.1 to the Initial Registration
Statement to Registration Statement No. 33-54471, filed on or
about July 5, 1994 is incorporated herein by reference.
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PAGE 47
6.2 Amended By-Laws of American Enterprise Life, filed
electronically as Exhibit 6.2 to the Initial Registration
Statement to Registration Statement No. 33-54471, filed on or
about July 5, 1994 is incorporated herein by reference.
7. Not applicable.
8.1 Copy of Participation Agreement among (company) and GT Global
Variable Investment Trust and GT Global Variable Investment
Series and GT Global Financial Services, Inc., dated February
10, 1995 is filed electronically as Exhibit 8.1 to Post-
Effective Amendment No. 3 to Registration Statement No. 33-
54471 is incorporated herein by reference.
8.2 Copy of Participation Agreement among Putnam Capital Manager
Trust, Putnam Mutual Funds Corp. and American Enterprise Life
Insurance Company, dated January 16, 1995, filed
electronically as Exhibit 8.2 to Post-Effective Amendment No.
2 to Registration Statement No. 33-54471 is incorporated
herein by reference.
8.3 Copy of Participation Agreement by and among Quest for Value
Accumulation Trust and (Insurance Company) and Quest for Value
Distributors, dated February 21, 1995, filed electronically as
Exhibit 8.3 to Post-Effective Amendment No. 2 to Registration
Statement No. 33-54471 is incorporated herein by reference.
9. Opinion of Counsel and consent to its use as to the legality
of the securities being registered was filed with Registrant's
most recent 24f-2 Notice on or about Feb. 23, 1996.
10. To be filed by Amendment.
11. Not applicable.
12. Not applicable.
13. Copy of schedule for computation of each performance quotation
provided in the Registration Statement in response to Item 21,
filed electronically as Exhibit 13 to the Initial Registration
Statement to Registration Statement No. 33-54471, filed on or
about July 5, 1994 is incorporated herein by reference.
14. To be filed by Amendment.
15. Power of Attorney to sign this Registration Statement dated
June 22, 1994, filed electronically as Exhibit 14.2 to the
Initial Registration Statement to Registration Statement No.
33-54471, filed on or about July 5, 1994 is incorporated
herein by reference.
<PAGE>
PAGE 48
Item 25. Directors and Officers of the Depositor (IDS Life
Insurance Company)
<TABLE>
<CAPTION>
Positions and
Name Principal Business Address Offices with Depositor
<S> <C> <C>
Timothy V. Bechtold IDS Tower 10 Vice President-Risk
Minneapolis, MN 55440 Management Products
David J. Berry IDS Tower 10 Vice President
Minneapolis, MN 55440
Alan R. Dakay IDS Tower 10 Vice President-
Minneapolis, MN 55440 Institutional Insurance
Marketing
Robert M. Elconin IDS Tower 10 Vice President
Minneapolis, MN 55440
Morris Goodwin Jr. IDS Tower 10 Vice President and Treasurer
Minneapolis, MN 55440
Lorraine R. Hart IDS Tower 10 Vice President-Investments
Minneapolis, MN 55440
David R. Hubers IDS Tower 10 Director
Minneapolis, MN 55440
James M. Jensen IDS Tower 10 Vice President-Insurance
Minneapolis, MN 55440 Product Development
Richard W. Kling IDS Tower 10 Director and President
Minneapolis, MN 55440
Paul F. Kolkman IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President
Ryan R. Larson IDS Tower 10 Vice President
Minneapolis, MN 55440
Janis E. Miller IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-
Variable Assets
James A. Mitchell IDS Tower 10 Director, Chairman of
Minneapolis, MN 55440 the Board and Chief
Executive Officer
Barry J. Murphy IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-
Client Service
James R. Palmer IDS Tower 10 Vice President-Taxes
Minneapolis, MN 55440
Stuart A. Sedlacek IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-Assured
Assets<PAGE>
PAGE 49
F. Dale Simmons IDS Tower 10 Vice President-
Minneapolis, MN 55440 Real Estate
Loan Management
William A. Stoltzmann IDS Tower 10 Vice President, General
Minneapolis, MN 55440 Counsel and Secretary
Melinda S. Urion IDS Tower 10 Director, Executive
Minneapolis, MN 55440 Vice President and
Controller
</TABLE>
Item 26. Persons Controlled by or Under Common Control with the
Depositor or Registrant
American Express Life Insurance is a wholly owned
subsidiary of IDS Life Insurance Company which is a
wholly owned subsidiary of American Express Financial
Corporation. American Express Financial Corporation is a
wholly owned subsidiary of American Express Company
(American Express).
The following list includes the names of major
subsidiaries of American Express.
Jurisdiction
Name of Subsidiary of Incorporation
I. Travel Related Services
American Express Travel Related
Services Company, Inc. New York
II. International Banking Services
American Express Bank Ltd. Connecticut
III. Companies engaged in Investors Diversified Financial Services
American Centurion Life Assurance Company New York
American Enterprise Investment Services Inc. Minnesota
American Enterprise Life Insurance Company Indiana
American Express Financial Advisors Inc. Delaware
American Express Financial Corporation Delaware
American Express Insurance Agency of Nevada Inc. Nevada
American Express Minnesota Foundation Minnesota
American Express Service Corporation Delaware
American Express Tax and Business Services Inc. Minnesota
American Express Trust Company Minnesota
American Partners Life Insurance Company Arizona
AMEX Assurance Company Illinois
IDS Advisory Group Inc. Minnesota
IDS Aircraft Services Corporation Minnesota
IDS Cable Corporation Minnesota
IDS Cable II Corporation Minnesota
IDS Capital Holdings Inc. Minnesota
IDS Certificate Company Delaware
IDS Deposit Corp. Utah
IDS Fund Management Limited U.K.
<PAGE>
PAGE 50
IDS Futures Corporation Minnesota
IDS Futures III Corporation Minnesota
IDS Insurance Agency of Alabama Inc. Alabama
IDS Insurance Agency of Arkansas Inc. Arkansas
IDS Insurance Agency of Massachusetts Inc. Massachusetts
IDS Insurance Agency of Mississippi Ltd. Mississippi
IDS Insurance Agency of New Mexico Inc. New Mexico
IDS Insurance Agency of North Carolina Inc. North Carolina
IDS Insurance Agency of Ohio Inc. Ohio
IDS Insurance Agency of Texas Inc. Texas
IDS Insurance Agency of Utah Inc. Utah
IDS Insurance Agency of Wyoming Inc. Wyoming
IDS International, Inc. Delaware
Item 26. Persons Controlled by or Under Common Control with the
Depositor or Registrant (Continued)
Jurisdiction
Name of Subsidiary of Incorporation
IDS Life Insurance Company Minnesota
IDS Life Insurance Company of New York New York
IDS Management Corporation Minnesota
IDS Partnership Services Corporation Minnesota
IDS Plan Services of California, Inc. Minnesota
IDS Property Casualty Insurance Company Wisconsin
IDS Real Estate Services, Inc. Delaware
IDS Realty Corporation Minnesota
IDS Sales Support Inc. Minnesota
IDS Securities Corporation Delaware
Investors Syndicate Development Corp. Nevada
Item 27. Number of Contractowners
On Aug. 31, 1996, there were 639 contract owners of
qualified contracts. There were 407 owners of non-
qualified contracts.
Item 28. Indemnification
The By-Laws of the depositor provide that the Corporation
shall have the power to indemnify a director, officer,
agent or employee of the Corporation pursuant to the
provisions of applicable statues or pursuant to contract.
The Corporation may purchase and maintain insurance on
behalf of any director, officer, agent or employee of the
Corporation against any liability asserted against or
incurred by the director, officer, agent or employee in
such capacity or arising out of the director's,
officer's, agent's or employee's status as such, whether
or not the Corporation would have the power to indemnify
the director, officer, agent or employee against such
liability under the provisions of applicable law.
The By-Laws of the depositor provide that it shall
indemnify a director, officer, agent or employee of the
depositor pursuant to the provisions of applicable
statutes or pursuant to contract.<PAGE>
PAGE 51
Insofar as indemnification for liability arising under
the Securities Act of 1933 may be permitted to director,
officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by
a director, officer or controlling person of the
registrant in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or
controlling person in connection with the securities
being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
Item 29. Principal Underwriters.
(a) American Express Financial Advisors acts as principal
underwriter for the following investment companies:
IDS Bond Fund, Inc.; IDS California Tax-Exempt Trust; IDS
Discovery Fund, Inc.; IDS Equity Select Fund, Inc.; IDS Extra
Income Fund, Inc.; IDS Federal Income Fund, Inc.; IDS Global
Series, Inc.; IDS Growth Fund, Inc.; IDS High Yield Tax-
Exempt Fund, Inc.; IDS International Fund, Inc.; IDS
Investment Series, Inc.; IDS Managed Retirement Fund, Inc.;
IDS Market Advantage Series, Inc.; IDS Money Market Series,
Inc.; IDS New Dimensions Fund, Inc.; IDS Precious Metals
Fund, Inc.; IDS Progressive Fund, Inc.; IDS Selective Fund,
Inc.; IDS Special Tax-Exempt Series Trust; IDS Stock Fund,
Inc.; IDS Strategy Fund, Inc.; IDS Tax-Exempt Bond Fund,
Inc.; IDS Tax-Free Money Fund, Inc.; IDS Utilities Income
Fund, Inc. and IDS Certificate Company.
<PAGE>
PAGE 52
(b) As to each director, officer or partner of the principal
underwriter:
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Ronald G. Abrahamson Vice President- None
IDS Tower 10 Service Quality and
Minneapolis, MN 55440 Reengineering
Douglas A. Alger Vice President-Total None
IDS Tower 10 Compensation
Minneapolis, MN 55440
Peter J. Anderson Senior Vice President- None
IDS Tower 10 Investments
Minneapolis, MN 55440
Ward D. Armstrong Vice President- None
IDS Tower 10 Sales and Marketing,
Minneapolis, MN 55440 IDS Institutional
Retirement Services
Joseph M. Barsky III Vice President-Senior None
IDS Tower 10 Portfolio Manager
Minneapolis, MN 55440
Robert C. Basten Vice President-Tax None
IDS Tower 10 and Business Services
Minneapolis, MN 55440
Timothy V. Bechtold Vice President-Risk None
IDS Tower 10 Management Products
Minneapolis, MN 55440
John D. Begley Group Vice President- None
Suite 100 Ohio/Indiana
7760 Olentangy River Rd.
Columbus, OH 43235
<PAGE>
PAGE 53
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Carl E. Beihl Vice President- None
IDS Tower 10 Strategic Technology
Minneapolis, MN 55440 Planning
Jack A. Benjamin Group Vice President- None
Suite 200 Greater Pennsylvania
3500 Market Street
Camp Hill, PA 17011
Alan F. Bignall Vice President- None
IDS Tower 10 Technology and
Minneapolis, MN 55440 Development
Brent L. Bisson Group Vice President- None
Ste 900 E. Westside Twr Los Angeles Metro
11835 West Olympic Blvd.
Los Angeles, CA 90064
John C. Boeder Vice President- None
IDS Tower 10 Mature Market Group
Minneapolis, MN 55440
Walter K. Booker Group Vice President- None
Suite 200 New Jersey
3500 Market Street
Camp Hill, NJ 17011
Bruce J. Bordelon Group Vice President- None
Galleria One Suite 1900 Gulf States
Galleria Blvd.
Metairie, LA 70001
Charles R. Branch Group Vice President- None
Suite 200 Northwest
West 111 North River Dr
Spokane, WA 99201
Karl J. Breyer Senior Vice President- None
IDS Tower 10 Corporate Affairs and
Minneapolis, MN 55440 Special Counsel
Daniel J. Candura Vice President- None
IDS Tower 10 Marketing Support
Minneapolis, MN 55440
Cynthia M. Carlson Vice President- None
IDS Tower 10 American Express
Minneapolis, MN 55440 Securities Services
<PAGE>
PAGE 54
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Orison Y. Chaffee III Vice President-Field None
IDS Tower 10 Real Estate
Minneapolis, MN 55440
James E. Choat Senior Vice President- None
IDS Tower 10 Field Management
Minneapolis, MN 55440
Kenneth J. Ciak Vice President and None
IDS Property Casualty General Manager-
1400 Lombardi Avenue IDS Property Casualty
Green Bay, WI 54304
Roger C. Corea Group Vice President- None
290 Woodcliff Drive Upstate New York
Fairport, NY 14450
Henry J. Cormier Group Vice President- None
Commerce Center One Connecticut
333 East River Drive
East Hartford, CT 06108
John M. Crawford Group Vice President- None
Suite 200 Arkansas/Springfield/Memphis
10800 Financial Ctr Pkwy
Little Rock, AR 72211
Kevin F. Crowe Group Vice President- None
Suite 312 Carolinas/Eastern Georgia
7300 Carmel Executive Pk
Charlotte, NC 28226
Colleen Curran Vice President and None
IDS Tower 10 Assistant General Counsel
Minneapolis, MN 55440
Alan R. Dakay Vice President- Director and
IDS Tower 10 Institutional Products President
Minneapolis, MN 55440 Group
Regenia David Vice President- None
IDS Tower 10 Systems Services
Minneapolis, MN 55440
Scott M. DiGiammarino Group Vice President- None
Suite 500 Washington/Baltimore
8045 Leesburg Pike
Vienna, VA 22182
<PAGE>
PAGE 55
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Bradford L. Drew Group Vice President- None
Two Datran Center Eastern Florida
Penthouse One B
9130 S. Dadeland Blvd.
Miami, FL 33156
William H. Dudley Director and Executive None
IDS Tower 10 Vice President-
Minneapolis MN 55440 Investment Operations
Gordon L. Eid Senior Vice President None
IDS Tower 10 and General Counsel
Minneapolis, MN 55440
Robert M. Elconin Vice President- None
IDS Tower 10 Government Relations
Minneapolis, MN 55440
Mark A. Ernst Vice President- None
IDS Tower 10 Retail Services
Minneapolis, MN 55440
Joseph Evanovich Jr. Group Vice President- None
One Old Mill Nebraska/Iowa/Dakotas
101 South 108th Avenue
Omaha, NE 68154
Louise P. Evenson Group Vice President- None
Suite 200 San Francisco Bay Area
1333 N. California Blvd.
Walnut Creek, CA 94596
Gordon M. Fines Vice President- None
IDS Tower 10 Mutual Fund Equity
Minneapolis MN 55440 Investments
Douglas L. Forsberg Group Vice President- None
Suite 100 Portland/Eugene
7931 N. E. Halsey
Portland, OR 97213
William P. Fritz Group Vice President- None
Suite 160 Northern Missouri
12855 Flushing Meadows Dr
St. Louis, MO 63131
Carl W. Gans Group Vice President- None
8500 Tower Suite 1770 Twin City Metro
8500 Normandale Lake Blvd.
Bloomington, MN 55437
<PAGE>
PAGE 56
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Robert G. Gilbert Vice President- None
IDS Tower 10 Real Estate
Minneapolis, MN 55440
John J. Golden Vice President- None
IDS Tower 10 Field Compensation
Minneapolis, MN 55440 Development
Morris Goodwin Jr. Vice President and None
IDS Tower 10 Corporate Treasurer
Minneapolis, MN 55440
Suzanne Graf Vice President- None
IDS Tower 10 Systems Services
Minneapolis, MN 55440
Bruce M. Guarino Group Vice President- None
Suite 1736 Hawaii
1585 Kapiolani Blvd.
Honolulu, HI 96814
David A. Hammer Vice President None
IDS Tower 10 and Marketing
Minneapolis, MN 55440 Controller
Teresa A. Hanratty Group Vice President- None
Suites 6&7 Northern New England
169 South River Road
Bedford, NH 03110
John R. Hantz Group Vice President- None
Suite 107 Detroit Metro
17177 N. Laurel Park
Livonia, MI 48154
Robert L. Harden Group Vice President- None
Two Constitution Plaza Boston Metro
Boston, MA 02129
Lorraine R. Hart Vice President- None
IDS Tower 10 Insurance Investments
Minneapolis, MN 55440
Scott A. Hawkinson Vice President-Assured None
IDS Tower 10 Assets Product Development
Minneapolis, MN 55440 and Management
Brian M. Heath Group Vice President- None
Suite 150 North Texas
801 E. Campbell Road
Richardson, TX 75081<PAGE>
PAGE 57
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
James G. Hirsh Vice President and None
IDS Tower 10 Assistant General
Minneapolis, MN 55440 Counsel
David J. Hockenberry Group Vice President- None
30 Burton Hills Blvd. Eastern Tennessee
Suite 175
Nashville, TN 37215
Kevin P. Howe Vice President- None
IDS Tower 10 Government and
Minneapolis, MN 55440 Customer Relations and
Chief Compliance Officer
David R. Hubers Chairman, Chief None
IDS Tower 10 Executive Officer and
Minneapolis, MN 55440 President
Marietta L. Johns Senior Vice President- None
IDS Tower 10 Field Management
Minneapolis, MN 55440
James E. Kaarre Vice President- None
IDS Tower 10 Marketing Promotions
Minneapolis, MN 55440
Linda B. Keene Vice President- None
IDS Tower 10 Market Development
Minneapolis, MN 55440
G. Michael Kennedy Vice President-Investment None
IDS Tower 10 Services and Investment
Minneapolis, MN 55440 Research
Susan D. Kinder Senior Vice President- None
IDS Tower 10 Human Resources
Minneapolis, MN 55440
Richard W. Kling Senior Vice President- Chairman of
IDS Tower 10 Risk Management Products the Board
Minneapolis, MN 55440
Paul F. Kolkman Vice President- None
IDS Tower 10 Actuarial Finance
Minneapolis, MN 55440
Claire Kolmodin Vice President- None
IDS Tower 10 Service Quality
Minneapolis, MN 55440
<PAGE>
PAGE 58
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
David S. Kreager Group Vice President- None
Ste 108 Trestle Bridge V Greater Michigan
5136 Lovers Lane
Kalamazoo, MI 49002
Steven C. Kumagai Director and Senior None
IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Management and Business
Systems
Mitre Kutanovski Group Vice President- None
Suite 680 Chicago Metro
8585 Broadway
Merrillville, IN 48410
Edward Labenski Jr. Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
Kurt A. Larson Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
Lori J. Larson Vice President- None
IDS Tower 10 Variable Assets Product
Minneapolis, MN 55440 Development
Ryan R. Larson Vice President- None
IDS Tower 10 IPG Product Development
Minneapolis, MN 55440
Daniel E. Laufenberg Vice President and None
IDS Tower 10 Chief U.S. Economist
Minneapolis, MN 55440
Richard J. Lazarchic Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
Peter A. Lefferts Senior Vice President- None
IDS Tower 10 Corporate Strategy and
Minneapolis, MN 55440 Development
Douglas A. Lennick Director and Executive None
IDS Tower 10 Vice President-Private
Minneapolis, MN 55440 Client Group
Mary J. Malevich Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
<PAGE>
PAGE 59
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Fred A. Mandell Vice President- None
IDS Tower 10 Field Marketing Readiness
Minneapolis, MN 55440
Daniel E. Martin Group Vice President- None
Suite 650 Pittsburgh Metro
5700 Corporate Drive
Pittsburgh, PA 15237
William J. McKinney Vice President- None
IDS Tower 10 Field Management
Minneapolis, MN 55440 Support
Thomas W. Medcalf Vice President- None
IDS Tower 10 Senior Portfolio Manager
Minneapolis, MN 55440
William C. Melton Vice President- None
IDS Tower 10 International Research
Minneapolis, MN 55440 and Chief International
Economist
Janis E. Miller Vice President- None
IDS Tower 10 Variable Assets
Minneapolis, MN 55440
James A. Mitchell Executive Vice President- None
IDS Tower 10 Marketing and Products
Minneapolis, MN 55440
John P. Moraites Group Vice President- None
Union Plaza Suite 900 Kansas/Oklahoma
3030 Northwest Expressway
Oklahoma City, OK 73112
Pamela J. Moret Vice President-Services None
IDS Tower 10
Minneapolis, MN 55440
Alan D. Morgenstern Group Vice President- None
Suite 200 Central California/
3500 Market Street Western Nevada
Camp Hill, NJ 17011
Barry J. Murphy Senior Vice President- None
IDS Tower 10 Client Service
Minneapolis, MN 55440
Mary Owens Neal Vice President- None
IDS Tower 10 Mature Market Segment
Minneapolis, MN 55440<PAGE>
PAGE 60
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Robert J. Neis Vice President- None
IDS Tower 10 Technology Services
Minneapolis, MN 55440 Operations
Ronald E. Newton Group Vice President- None
319 Southbridge St. Rhode Island/Central
Auburn, MA 01501 Massachusetts
Thomas V. Nicolosi Group Vice President- None
Suite 220 New York Metro Area
500 Mamaroneck Avenue
Harrison, NY 10528
James R. Palmer Vice President- None
IDS Tower 10 Taxes
Minneapolis, MN 55440
Carla P. Pavone Vice President- None
IDS Tower 10 Specialty Service Teams
Minneapolis, MN 55440 and Emerging Business
Susan B. Plimpton Vice President- None
IDS Tower 10 Segmentation Development
Minneapolis, MN 55440 and Support
Larry M. Post Group Vice President- None
One Tower Bridge Philadelphia Metro
100 Front Street 8th Fl
West Conshohocken, PA 19428
Ronald W. Powell Vice President and None
IDS Tower 10 Assistant General
Minneapolis, MN 55440 Counsel
James M. Punch Vice President- None
IDS Tower 10 Geographical Service
Minneapolis, MN 55440 Teams
Frederick C. Quirsfeld Vice President-Taxable None
IDS Tower 10 Mutual Fund Investments
Minneapolis, MN 55440
R. Daniel Richardson Group Vice President- None
Suite 800 Southern Texas
Arboretum Plaza One
9442 Capital of Texas Hwy N.
Austin, TX 78759
<PAGE>
PAGE 61
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Roger B. Rogos Group Vice President- None
One Sarasota Tower Western Florida
Suite 700
Two N. Tamiami Trail
Sarasota, FL 34236
ReBecca K. Roloff Vice President-Private None
IDS Tower 10 Client Group
Minneapolis, MN 55440
Stephen W. Roszell Vice President- None
IDS Tower 10 Advisory Institutional
Minneapolis, MN 55440 Marketing
Max G. Roth Group Vice President- None
Suite 201 S IDS Ctr Wisconsin/Upper Michigan
1400 Lombardi Avenue
Green Bay, WI 54304
Robert A. Rudell Vice President- None
IDS Tower 10 American Express
Minneapolis, MN 55440 Institutional Retirement
Services
John P. Ryan Vice President and None
IDS Tower 10 General Auditor
Minneapolis, MN 55440
Erven Samsel Senior Vice President- None
45 Braintree Hill Park Field Management
Suite 402
Braintree, MA 02184
Russell L. Scalfano Group Vice President- None
Suite 201 Illinois/Indiana/Kentucky
101 Plaza East Blvd.
Evansville, IN 47715
William G. Scholz Group Vice President- None
Suite 205 Arizona/Las Vegas
7333 E Doubletree Ranch Rd
Scottsdale, AZ 85258
Stuart A. Sedlacek Vice President- Director and
IDS Tower 10 Assured Assets Executive
Minneapolis, MN 55440 Vice
President,
Assured
Assets
<PAGE>
PAGE 62
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Donald K. Shanks Vice President- None
IDS Tower 10 Property Casualty
Minneapolis, MN 55440
F. Dale Simmons Vice President-Senior None
IDS Tower 10 Portfolio Manager,
Minneapolis, MN 55440 Insurance Investments
Judy P. Skoglund Vice President- None
IDS Tower 10 Human Resources and
Minneapolis, MN 55440 Organization Development
Julian W. Sloter Group Vice President- None
Ste 1700 Orlando FinCtr Orlando/Jacksonville
800 North Magnolia Ave.
Orlando, FL 32803
Ben C. Smith Vice President- None
IDS Tower 10 Workplace Marketing
Minneapolis, MN 55440
William A. Smith Vice President and None
IDS Tower 10 Controller-Private
Minneapolis, MN 55440 Client Group
James B. Solberg Group Vice President- None
466 Westdale Mall Eastern Iowa Area
Cedar Rapids, IA 52404
Bridget Sperl Vice President- None
IDS Tower 10 Human Resources
Minneapolis, MN 55440 Management Services
Paul J. Stanislaw Group Vice President- None
Suite 1100 Southern California
Two Park Plaza
Irvine, CA 92714
Lois A. Stilwell Group Vice President- None
Suite 433 Outstate Minnesota Area/
9900 East Bren Road North Dakota/Western Wisconsin
Minnetonka, MN 55343
William A. Stoltzmann Vice President and Director,
IDS Tower 10 Assistant General Vice
Minneapolis, MN 55440 Counsel President,
General
Counsel and
Secretary
<PAGE>
PAGE 63
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
James J. Strauss Vice President- None
IDS Tower 10 Corporate Planning
Minneapolis, MN 55440 and Analysis
Jeffrey J. Stremcha Vice President-Information None
IDS Tower 10 Resource Management/ISD
Minneapolis, MN 55440
Neil G. Taylor Group Vice President- None
Suite 425 Seattle/Tacoma
101 Elliott Avenue West
Seattle, WA 98119
John R. Thomas Senior Vice President- None
IDS Tower 10 Information and
Minneapolis, MN 55440 Technology
Melinda S. Urion Senior Vice President Vice
IDS Tower 10 and Chief Financial President and
Minneapolis, MN 55440 Officer Controller
Peter S. Velardi Group Vice President- None
Suite 180 Atlanta/Birmingham
1200 Ashwood Parkway
Atlanta, GA 30338
Charles F. Wachendorfer Group Vice President- None
Suite 100 Denver/Salt Lake City/
Stanford Plaza II Albuquerque
7979 East Tufts Ave Pkwy
Denver, CO 80237
Wesley W. Wadman Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
Norman Weaver Jr. Senior Vice President- None
1010 Main St Suite 2B Field Management
Huntington Beach, CA 92648
Michael L. Weiner Vice President- None
IDS Tower 10 Tax Research and Audit
Minneapolis, MN 55440
Lawrence J. Welte Vice President- None
IDS Tower 10 Investment Administration
Minneapolis, MN 55440
Jeffry M. Welter Vice President- None
IDS Tower 10 Equity and Fixed Income
Minneapolis, MN 55440 Trading<PAGE>
PAGE 64
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
William N. Westhoff Senior Vice President and None
IDS Tower 10 Global Chief Investment
Minneapolis, MN 55440 Officer
Thomas L. White Group Vice President- None
Suite 200 Cleveland Metro
28601 Chagrin Blvd.
Woodmere, OH 44122
Eric S. Williams Group Vice President- None
Suite 250 Virginia
3951 Westerre Parkway
Richmond, VA 23233
Edwin M. Wistrand Vice President and None
IDS Tower 10 Assistant General
Minneapolis, MN 55440 Counsel
Michael R. Woodward Senior Vice President- None
32 Ellicott St Ste 100 Field Management
Batavia, NY 14020
Item 29(c).
<TABLE>
<CAPTION>
Net Underwriting
Name of Principal Discounts and Compensation on Brokerage
Underwriter Commissions Redemption Commissions Compensation
<S> <C> <C> <C> <C>
American Express
Financial Advisors
Inc.
</TABLE>
Item 30. Location of Accounts and Records
American Enterprise Life Insurance Company
IDS Tower 10
Minneapolis, MN 55402
Item 31. Management Services
Not applicable.
Item 32. Undertakings
(a) Registrant undertakes that it will file a
post-effective amendment to this registration
statement as frequently as is necessary to ensure
that the audited financial statements in the
registration statement are never more than 16
months old for so long as payments under the
variable annuity contracts may be accepted.
<PAGE>
PAGE 65
(b) Registrant undertakes that it will include either
(1) as part of any application to purchase a
contract offered by the prospectus, a space that an
applicant can check to request a Statement of
Additional Information, or (2) a post card or
similar written communication affixed to or
included the prospectus that the applicant can
remove to send for a Statement of Additional
Information.
(c) Registrant undertakes to deliver any Statement of
Additional Information and any financial statements
required to be made available under this Form
promptly upon written or oral request to IDS Life
Contract Owner Service at the address or phone
number listed in the prospectus.
<PAGE>
PAGE 66
SIGNATURES
As required by the Securities Act of 1933 and the Investment
Company Act of 1940, American Enterprise Life Insurance Company, on
behalf of the Registrant has duly caused this Registration
Statement to be signed on its behalf, in the City of Minneapolis,
and State of Minnesota, on the 13th day of September, 1996.
AMERICAN ENTERPRISE VARIABLE ANNUITY ACCOUNT
(Registrant)
By American Enterprise Life Insurance Company
(Sponsor)
By /s/ Richard W. Kling*
Richard W. Kling
Chairman of the Board
As required by the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the
capacities indicated on the 13th day of September, 1996.
Signature Title
/s/ Richard W. Kling* Director and Chairman of
Richard W. Kling the Board
/s/ Paul S. Mannweiler* Director
Paul S. Mannweiler
/s/ Stuart A. Sedlacek* Director and Executive Vice
Stuart A. Sedlacek President-Assured Assets
/s/ William A. Stoltzmann* Director, Vice President,
William A. Stoltzmann General Counsel and
Secretary
*Signed pursuant to Power of Attorney filed electronically as
Exhibit 14.2 to the Initial Registration Statement to Registration
Statement No. 33-54471, filed on or about July 5, 1994, is
incorporated herein by reference.
______________________________
Mary Ellyn Minenko
<PAGE>
PAGE 67
CONTENTS OF POST-EFFECTIVE AMENDMENT NO. 4
This Registration Statement is comprised of the following papers
and documents:
The Cover Page.
Cross-reference sheet.
Part A.
The prospectus.
Part B.
Statement of Additional Information.
Part C.
Other Information.
The signatures.
Exhibits.
