FOR AGENT USE ONLY PLEASE BE ADVISED: ALL SPECIFIC LEGAL AND TAX - - PowerPoint PPT Presentation
STRATEGIC AGENT PARTNERS WORK WITH A VARIETY OF LIFE INSURANCE AND ANNUITY PRODUCTS WITH SEVERAL LEADING COMPANIES. PRODUCT AVAILABILITY VARIES BY STATE. GUARANTEES ARE BASED UPON THE CLAIMS-PAYING ABILITY OF THE ISSUER. FOR AGENT USE ONLY
STRATEGIC AGENT PARTNERS WORK WITH A VARIETY OF LIFE INSURANCE AND ANNUITY PRODUCTS WITH SEVERAL LEADING COMPANIES. PRODUCT AVAILABILITY VARIES BY
ABILITY OF THE ISSUER. FOR AGENT USE ONLY
ALL SPECIFIC LEGAL AND TAX QUESTIONS SHOULD BE REFERRED TO YOUR LEGAL AND TAX ADVISERS
Year 1950 1960 1970 1980 1990 2000 2004 Life Expectancy at Birth 68.2 69.7 70.8 73.7 75.4 76.9 77.8
Life expectancy has increased nearly ten years since 1950!
Source: National Center For Health Statistics, Department of Health and Human Services (2004).
Year Inflation Rate Purchasing Power
1967 (Base Year)
1972 3.3% 80 cents 1976 6.5% 55 cents 1982 6.7% 37 cents 1987 4.4% 29 cents 1992 2.9% 24 cents 1997 1.5% 21 cents 2002 2.4% 19 cents 2006 2.5% 17 cents Over the last 38 years, the annual inflation rate in the U.S. has averaged 4.75%.
*Source: United States Bureau of Labor Statistics, Consumer Price Index,
(DATE). Purchasing Power amounts are rounded to the nearest cent.
“UNLESS ACTION IS TAKEN TO STRENGTHEN SOCIAL SECURITY, IN N JUS UST 11 YEARS RS WE WILL LL BE BEGIN IN PAYI YING NG MO MORE IN BENEFI FITS S THAN WE COLLECT LECT IN TAXE XES.
CHANGES, BY 2041 THE SO SOCI CIAL AL SE SECU CURIT RITY Y TRUST ST FUNDS DS WILL BE EXHAUSTED… THERE WILL NOT BE ENOUGH YOUNGER PEOPLE WORKING TO PAY ALL OF THE BENEFITS SCHEDULED FOR THOSE WHO ARE RETIRING. AT THAT POINT, THERE WILL BE ENOUGH MONEY TO PAY ONLY ABOUT 74 CENTS FOR EACH DOLLAR OF BENEFITS THAT RETIREES ARE SCHEDULED TO RECEIVE.”
Text taken directly from the front page
“RECORD NUMBER OF EXTRAORDINARILY LARGE CLAIMS” FOR FAILING PENSIONS.
ION IN CLAIMS PAID
Source: Pension Insurance Data Book 2005, Pension Benefit Guarantee Corporation (PBGC). The PBGC insures about 2/3 of the private sector defined benefit pension plans.
The number of insured pension plans has decreased by 75% since 1985.
Source: Pension Insurance Data Book 2005, Pension Benefit Guarantee Corporation. The PBGC insures about 2/3 of the private sector defined benefit pension plans.
NE NEARL RLY Y ONE NE TH THIRD IRD OF ALL U.S. COMPANIES CLOSED, FROZE OR TERMINATED THEIR DEFINED BENEFIT PENSION PLANS AT THE END OF 2007.
14 major federal tax bills have been enacted since 1986!
FOR MANY INDIVIDUALS, SOCIAL SECURITY AND COMPANY PROVIDED PENSION PLANS SUPPLIED ENOUGH INCOME FOR A COMFORTABLE RETIREMENT.
AL SECURIT ITY Y AND PENSIONS: ONS: WILL PROVIDE A MUCH SMALLER PORTION.
SONAL NAL SAVINGS: INGS:WILL PROVIDE THE MAJORITY OF EACH RETIREMENT DOLLAR
Relying primarily on government programs and employer-sponsored pension plans could leave you short of income during your retirement years
*Cash flow is tax free as long as policy withdrawals and loans are properly structured. **Under current tax laws.
Accumulation Phase Retirement Cash Flow Phase Death Benefit
Accumulation Phase Retirement Cash Flow Phase Death Benefit
premiums
grows income tax deferred
creditor protected
(varies by state)
Accumulation Phase Retirement Cash Flow Phase Death Benefit
to provide tax-free retirement income
available for other needs such as education funding or family and charitable gifting programs
Accumulation Phase Retirement Cash Flow Phase Death Benefit
lump- sum death benefit to heirs
be structured to pass estate tax free to heirs
Accumulation Phase Retirement Cash Flow Phase Death Benefit
lump-sum death benefit to heirs
be structured to pass estate tax free to heirs
to provide tax-free retirement cash flow
available for other needs such as education funding or family and charitable gifting programs
insurance premiums
grows income tax deferred
creditor protected
(varies by state)
PROFI FILE
BOTH AGE 45
COVERAGE ON GARY ($250,000)
CONSIST OF A 401(K) ($150,000) AND A ROLLOVER IRA ($120,000)
CASH FLOW
SAVINGS
BENEFIT PROTECTION
ON GARY (OR SUSAN)
FOR 20 YEARS
$10,000 annual insurance premium Annual tax-free policy cash flow
for 15 years Death benefit of $72,018 at age 85 Tax-deferred policy cash value and death benefit for family protection Income tax-free death benefit paid to heirs Income tax-free retirement cash flow starting at age 65 Accumulation Retirement Income Death Benefit
COST
BENEFIT ITS
Example depicts Virtus Value – “Wash Loan” with an annual premium of $10,000 for twenty years and policy loans taken for 15 years starting in year 21. The interest rate credited to the policy shown is 4.8% in years 1-10 and 5.3% in years 11 and later. Adverse income tax consequences may result if the policy is surrendered or allowed to lapse prior to maturity Year Age Annual Premium Total Premiums Annual Retirement Cash Flow Total Income Received Income Tax Death Benefit 1 46 $10,000 $10,000 $203,040 5 50 $10,000 $50,000 $248,021 10 55 $10,000 $100,000 $316,996 20 65 $10,000 $200,000 $524,475 21 66 $200,000 $28,509 $ 28,509 $495,941 25 70 $200,000 $28,509 $142,545 $381,805 30 75 $200,000 $28,509 $285,090 $231,691 35 80 $200,000 $28,509 $427,635 $ 59,365
WAIVER OF PREMIUM FOR TOTAL DISABILITY RIDER PROTECTS YOUR CASH VALUES IN THE EVENT OF DISABILITY
In the event of the insured’s disability for six months, premiums will be waived and cash values will continue to accumulate.