Income For Life - Stratton & Company

WelcomeCreative Solutions for Your Long-Term Income Needs

FocusOn®

Income for Life(904) 425-0943

RetirementTeam.com

Workshop Objectives

Introduce

Educate

Illustrate

(904) 425-0943 RetirementTeam.com

Our Commitment

Provide useful and applicable information

Help you identify goals

Offer no-obligation review

The information provided in this presentation is not written or intended as tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel.


18%

Financial Challenges

Only 18% ofworkers are very confident that they will have enough money for retirement.

Source: 2014 Retirement Confidence Survey, Employee Benefit Research Institute


Income for Life

1. ANNUITIES FOR AN INCOME YOU CAN’T OUTLIVE

2. TAX CONSIDERATIONS

3. CASE STUDIES

4. IMPORTANT QUESTIONS


According to SSA.gov more than one in three 65 year olds today will live to be age 90 and more than one in seven will live to age 95.

The information provided in this presentation is not written or intended as tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel.


Income You Can’t Outlive – The Annuity


What Is an Annuity?

You

Premiums

Income

Insurancecompany

Insurance-based contract

Option for lifetime income

Tax-deferred accumulation


Types of Annuities

Deferredannuity

Immediateannuity


Fixed vs. Variable Annuity3

IMPORTANT QUESTIONS

Fixed Indexed Annuities Must have fixed account

Cannot credit negative interest

Interest is based on performance of one or more indexes

Account balance will not be reduced by negative interest


Fixed Indexed Annuities

Preservation

Accumulation

Guaranteed income


Guaranteed Lifetime Income


Now it can.




3. CASE STUDIES


Income for Life

Stratton & Company does not provide tax and legal advice. You are encouraged to consult your tax advisor or attorney.


Tax-Deferred Compounding

Earnings are not taxed until withdrawn

Postponing taxes keeps more of your money working for you

Stratton & Company does not provide tax and legal advice. You are encouraged to consult your tax advisor or attorney.


Taxable (28%)

Tax-deferred fixed annuity

Tax-deferred fixed annuity after taxes$202,763

30 years

$123,825 $134,392$153,327

$180,611 $189,857

$242,726

10 years 20 years

$100,000 initial premium 3% rate of return 28% tax rate

Annuities and Taxes

This hypothetical example is used for illustrative purposes only and does not represent any specific investment or annuity. Annuities typically have mortality and expense charges, surrender charges for early withdrawals, and administrative fees. These fees and charges are not reflected in this example and would reduce the performance shown if they were included. Any guarantees are contingent on the claims-paying ability of the issuing company.


Penalties and Surrender Charges

10% federal income tax penalty on withdrawals taken prior to age 59½

Most annuities are subject to surrender charges in the early years of the contract


1. ANNUITIES FOR AN INCOMEYOU CAN’T OUTLIVE


3. CASE STUDIES


Income for Life


Case StudyThe Millers

Bob: 65, retired at 62 Susan is 62, lost her job Could not continue her health insurance, not

old enough for medicare Great savers Large IRAs, joint NQ accounts

SITUATION

This hypothetical example is used for illustrative purposes only. It does not consider the effects of sales charges or other expenses. Actual results will vary. The FDIC currently insures bank CDs for up to $250,000 per depositor, per insured institution. The issuing insurance company guarantees fixed annuities, but these guarantees are contingent on the claims-paying ability of the issuing company.

Case StudyThe Millers

Fixed indexed annuities for their IRAs and purchased life insurance on each of them

– Take single life distributions from Susan’s pension and each of their annuities

– Yield - increased monthly income

SOLUTION

This hypothetical example is used for illustrative purposes only. It does not consider the effects of sales charges or other expenses. Actual results will vary. The FDIC currently insures bank CDs for up to $250,000 per depositor, per insured institution. The issuing insurance company guarantees fixed annuities, but these guarantees are contingent on the claims-paying ability of the issuing company.



3. CASE STUDIES


Income for Life


Social SecurityAge to receive full Social Security benefits

Year of birth Full retirement age

1943-1954 66

1955 66 and 2 months





1960 and later 67

NOTE: People who were born January 1 of any year should refer to the previous year.

information from socialsecurity.gov


Sign up for Social Security

You can apply for retirement benefits online at ww.socialsecurity.gov or call toll-free at 1-800-772-1213 or make an appointment at the office.


Medicare has four parts

Hospital insurance

Medical insurance

Medical Advantage plans

Prescription drug coverage


How Do You Select an Insurance Company?

DescriptionA.M.Best

Standard& Poor’s Moody’s

FitchRatings

SUPERIOR A++ AAA Aaa AAAVery little risk A+

EXCELLENT A AA+ Aa1 AAASlightly higher risk A– AA Aa2

AA– Aa3

GOOD B++ A+ A1 BBBHigh claims- B+ A A2paying ability A– A3

ADEQUATE B BBB+ Baa1 BBLess protection B– BBB Baa2against risk BBB– Baa3

BEL0W AVERAGE C++ BB+ Ba1 __Relatively high C+ BB Ba2risk factor BB– Ba3

WEAK C B+ B1 BVery high risk factor C– B B2

B– B3

NONVIABLE D CCCCCR

Caa CDE Ca

F C

4IMPORTANT QUESTIONS

Selecting an Insurance Company

A.M. Best 908-439-2200

Standard & Poor’s 212-438-2400

Moody’s 212-553-1653

Fitch Ratings 800-893-4824

OBTAINING RATINGS


Annuities and Creative Solutions


Where Do You Go from Here?


Do it yourself Work with others Work with us Procrastinate

Where Do You Go from Here?



Thank YouThank You(904) 425-0943

RetirementTeam.com

Economy & Finance

Income For Life - Stratton & Company