The Ameritas opportunity and The Retirement Traps

Transcription

1 The Ameritas opportunity and The Retirement Traps Jill Davis, CFP, FLMI National Sales Consultant DST

2 Disclosures The information presented here is not intended as tax or other legal advice. For application of this information to your client s specific situation, they should consult an attorney. Excel Index UL (Form 3009) and the Total Disability Benefit Rider (Form ATDB01) are issued by Ameritas Life Insurance Corp. In New York, Excel Index UL (Form 5009) and the Total Disability Benefit Rider (Form FITDBR 3-10) are issued by Ameritas Life Insurance Corp. of New York. Product may not be available in all states. Optional provisions and riders may have limitations, restrictions, and additional charges. Standard & Poor s, S&P, S&P 500, Standard & Poor s 500 and 500 are trademarks of the McGraw-Hill Companies, Inc. and have been licensed for use by Ameritas Life Insurance Corp. Excel Index UL is not sponsored, endorsed, sold or promoted by Standard & Poor s and Standard & Poor s makes no representation regarding the advisability of purchasing the product. A variable annuity can be an integral part of your clients long term retirement planning strategy, providing direction to help them overcome unnecessary risks and important optional benefits to help protect their financial future. Variable annuities provide a tax-deferral benefit that can work well with your clients goal of investing for long-term retirement. Variable annuities offer professionally managed investment options, guaranteed death benefits and payment options to meet your clients needs, but your clients should read the prospectus before investing in variable annuities to make sure they understand the risks and charges involved. Withdrawals and loans will reduce available life insurance death benefit and policy values. Withdrawals beyond cost basis may be taxable income. Excessive and unpaid loans may also cause the policy to lapse. If the policy lapses, unpaid loans are treated as distributions for tax purposes.

3 Disclosures This seminar is for informational purposes only and will cover a variety of topics examining the role insurance and other financial products may play in financial decisions. Although many of the topics presented may also involve tax, legal, accounting, or other issues, neither Ameritas, nor any of its representatives, provides tax, legal or accounting advice. You and your clients should consult with your own accounting, tax, or legal professionals to determine action appropriate for your unique situation. This information is provided by Ameritas, which is a marketing name for subsidiaries of Ameritas Mutual Holding Company, including, but not limited to, Ameritas Life Insurance Corp., Ameritas Life Insurance Corp. of New York and Ameritas Investment Corp., member FINRA/SIPC. Ameritas Life Insurance Corp. is not licensed in New York. Each company is solely responsible for its own financial condition and contractual obligations. For more information about Ameritas, visit ameritas.com. Ameritas and the bison are registered service marks of Ameritas Life Insurance Corp. Fulfilling life is a registered service mark of Ameritas Holding Company Ameritas Mutual Holding Company

4 Overview Corporate Structure Mutual Holding Company Headquarters Lincoln, Nebraska Size* $34.1 billion Assets Under Management $81.9 billion Life Insurance in Force 3.2 million customers chose Ameritas *as of December 31, 2013 Established 1887 (Ameritas) 127 th Anniversary - April 6, 2014 Financial Strength Standard &Poor s A+ (Strong) for insurer financial strength. This is the fifth highest of Standard & Poor s 21 ratings. A.M. Best Company A (Excellent) for financial strength and operating performance. This is the third highest of A.M. Best s 15 ratings.

5 Lines of Business Life Annuities Dental Vision Group Annuities Ameritas Investment Corp., member FINRA/SIPC Summit Investment Advisors, Inc. Disability Income Hearing Calvert Investments, Inc.

6 Retirement Traps

7 Retirement Gap Help your clients prepare now to avoid the Retirement Income Gap Nearly 45 percent of Americans ages years old are not expected to have enough money to cover basic living expenses like food, utilities and health care throughout retirement, according to a 2011 study by the Employee Benefit Research Institute 1. How can you help a client who is facing this situation?

8 When Do You Expect to Retire? < Not Retiring USA Today , Transamerica Center for Retirement Studies survey of 4,080 workers

9 Retirement Trap The Approach Tax Exempt or Tax Free Tax Deferred Taxable

10 Retirement Trap The Approach The Traps Tax Exempt or Tax Free Accumulation Distribution Taxation Tax Deferred Death Disability Taxable Market

11 Accumulation: Limits on Dollars to Fund for Retirement Vehicle Roth IRA Year Pre- Tax Contribution Limit $5,500 +$1, (k) $17,500 +$5,500 Other Limit $181,000 AGI Have to be working Defined Benefit $210,000 Have to be working

12 Distribution: Restrictions on Access to Your Monies Age Penalties 59 ½ 10% 70 ½ RMD Force Out

13 Taxation: All qualified monies when withdrawn are taxable at current income rates

14 Death: All death benefits paid by qualified plans are taxed at beneficiary s rate at death. Example: Qualified Assets Daughter at ,000 Earns $150,000 Gross Income Year of Death: $650,000 Tax Due approximately $250,000 Tax Bracket Jumped from 28% to 39.6%

15 Disability: Short Circuits the Funding of all your plans Employer contributions cease Employee contribution suspended no earned income Strategy: Total Disability Rider Continues to pay Planned Premium Supplemental retirement plan is self completing

16 Market: Remember 2008 and 2009? Pre-Retirees Had to Postpone Retirement I don t want return on principal, I just want return of my principal ~ Will Rogers Strategies to Mitigate Market Volatility Whole Life Indexed UL

17 What Effects Will a Down Market Have on My Retirement Income Age Beginning of Year Balance Systematic Withdrawal on 1/1 Morningstar Moderate Allocation Benchmark End of Year Balance 65 $1,500,000 $150, % $1,316, $1,316,790 $150, % $1,088, $1,088,732 $150, % $1,149, $1,149,759 $150, % $1,114, $1,114,531 $150, % $1,032, $1,032,434 $150, % $996, $996,709 $150, % $919, $919,780 $150, % $598, $598,966 $150, % $546, $546,706 $150, % $445, $445,620 $150, % $297,364

18 An Alternate Approach Age Beginning of Year Balance Systematic Withdrawal on 1/1 Morningstar Moderate Allocation Benchmark End of Year Balance 65 $1,500,000 $150, % $1,316, $1,316,790 $0-6.69% $1,228, $1,228,697 $ % $1,504, $1,504,908 $150, % $1,510, $1,510,451 $150, % $1,456, $1,456,227 $150, % $1,457, $1,475,383 $150, % $1,439, $1,439,764 $150, % $1,003, $1,003,565 $40,630* 21.77% $1,172, $1,172,566 $150, % $1,148, $1,148,649 $150, % $1,004,541 *This value represents the Required Minimum Distribution from the IRA that year.

19 Trusted Strategy Kit 1. Approach 2. The Problem Client Collateral 3. The Strategy Client Collateral 4. Agenda 5. Fact Finder

20 Retirement Planning A retirement plan without insurance is just a savings and investment program that dies or becomes disabled when you do. -Allan Hancock The Life Insurance Foundation for Education

21 Materials LI 1579 LI 1578

22 Materials LI 1584

23 Additional Benefits of Permanent Life Insurance Cash value life insurance may be one of the most overlooked product options to help supplement a client s income in retirement. No other financial vehicle can offer all of the benefits that life insurance can provide: Income Tax-Free Death Benefit Tax-Deferred Growth No Distribution Requirements or Penalties No Contribution Limits No Effect on Social Security Self Completion with Total Disability Rider

24 Ameritas Life Products All Seasons Portfolio

25 Life Products Style Box Guarantees/Safety Risk Profile Variable/Market Risk Keystone Foundation WL Excel Plus Index UL Excel Index UL Excel Performance VUL max funded Keystone WL Excel LifeValue UL Excel LifeValue SUL Excel Performance VUL target funded Keystone Term Keystone WL with level term rider Excel Essential UL Guarantees are backed by claims paying ability of issuing company.

26 Help is just a call away Sales Development option 1 Advanced Sales option 2 Ameritas.com Jill Davis, CFP, FLMI ext Cell: jdavis@ameritas.com Eric Ojeda, LUTCF Internal Sales Consultant ext eojeda@ameritas.com