# PREMIER FINANCIAL ALLIANCE

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PREMIER FINANCIAL ALLIANCE
FINANCIAL PLANNING PRESENTATION 1

THREE ENEMIES OF YOUR MONEY “ T I P ” HOW MONEY WORKS TYPES OF MONEY INSURANCE MARKET THREATS TO YOUR FINANCIAL SECURITY THE REVOLUTIONARY SOLUTION THE SECRET OF MONEY

TAXES INCOME TAXES SALES TAXES CAPITAL GAINS TAXES ESTATE TAXES

INFLATION THE SILENT KILLER OF YOUR MONEY

PROCASTINATION HIGH COST OF WAITING

The person with the most “doubles” wins.
HOW MONEY WORKS Rule of 72 Divide 72 by the interest rate to estimate the number of years it takes for your money to double. Age 4% Money Doubles Every 18 Years 29 \$10,000 47 \$20,000 65 \$40,000 Age % Money Doubles Every 9 Years \$10,000 \$20,000 \$40, \$80,000 65 \$160,000 Age % Money Doubles Every 6 Years \$10,000 \$20,000 \$40, \$80,000 53 \$160,000 59 \$320, \$640,000 The person with the most “doubles” wins. * These hypothetical examples are for illustrative purposes only and do not represent any particular investment vehicle. The Rule of 72 is a mathematical concept that approximates the number of years it would take to double the principal at a constant rate of return. The performance of investments fluctuates over time, and as a result, the actual time it will take an investment to double in value cannot be predicted with any certainty.

TYPES OF MONEY FREE MONEY TAX FREE MONEY TAX DEFFERED MONEY
401K, LOTTERY TAX FREE MONEY ROTH IRA LIFE INSURANCE TAX DEFFERED MONEY 401K IRA TAXABLE MONEY EVERYTHING ELSE

VARIABLE UNIVERSAL LIFE EQUITY INDEX UNIVERSAL LIFE
INSURANCE MARKET TEMPORARY LIFE INSURANCE (RENTING) PERMANENT LIFE INSURANCE (BUYING) RATE OF RETURN %-3.5% WHOLE LIFE RATE OF RETURN %-5% UNIVERSAL LIFE TIED WITH STOCKS VARIABLE UNIVERSAL LIFE RATE OF RETURN %-12% AVERAGE 7.3%-8.3% EQUITY INDEX UNIVERSAL LIFE EXPIRES AFTER CERTAIN TIME TERM LIFE RETURN OF PREMIUM

PREMATURE DEATH Households saying they own enough life insurance to replace their income for only 2.8 years. ILLNESS Every 40 seconds someone in the US suffers a stroke. Every minute an American will die from a coronary event1. . DISABILITY One in 5 working Americans suffers the effects of a disability for more than six months during his/her working career2. LONG-TERM CARE The U.S. Bureau of Census estimates that by 2060 as many as 24 million people will need long term care services. OUTLIVING YOUR MONEY People are living longer and longer, but they are saving less and less. Most Americans retire in poverty. 73.8% of Americans 65 and older retire on a combined income of private pension and Social Security of \$10,000 less a year3. American Heart Association, American Stroke Association, Heart Disease and Stroke Statistics, 2008 Commissioners Group disability table and U.S. Bureau of Census Social Security Administration, 1996

Accelerated Benefits Riders
ABR 1- Terminal Illness Resulting in death within two years (1 year in VT and PA) Lump-sum distribution (discounted from death benefit) Funds can be used for anything No additional cost No elimination period Let’s go over the living benefits that we offer your clients. We refer to them as Accelerated Benefits – otherwise known as ABR Riders. We offer 3 state of the art ABR riders. We’ll go over what we call ABR1 – for terminal illness. Our terminal illness rider pays a benefit if the diagnosis is terminal and the Insured is expected to die within 2 years of that diagnosis. Many other carriers offer Terminal illness riders but with death resulting in 1 year from diagnosis. LSW offers a liberal benefit with its 2 year definition. We also offer a maximum benefit of \$1,000,000 – many other carriers offer \$500,000 of benefit or less. We offer either a full election – or a partial election – the money is paid out in a lump sum – no monthly benefits - to the owner of the policy at any point after the issue date – there is no elimination period. We do not require proof that the money is being used to pay medical expenses but we do ask for certification by a Physician who is recognized by the law of the state.

Accelerated Benefits Riders
ABR 2 - Chronically ill Unable to perform 2 of 6 ADLs Activities of Daily Living Bathing Continence Dressing Eating Toileting Transferring Cognitive Impairment Short-term or long-term memory impairment Loss of orientation to people, places or time Deductive or abstract reasoning impairment Max. benefit calculated as 24% of the net death benefit (actual payment is discounted) in any calendar year Funds can be used for anything No additional cost Policy must be I/F for 2 years ABR 2 – provides for Chronic Illness. This is very much like the requirements under a true LTC policy in terms of the definition of a qualifying event. There must be the inability to perform at least 2 of the 6 ADL’s which you’ll see on the next slide. There are restrictions in terms of when benefits become available with this rider. The insurance policy must be I/F for 2 years. A duly licensed medical Physician must certify that the Insured is Chronically Ill for a period of at least 90 days before we can accelerate the death benefit. Once approved, this rider will pay a 24% lump sum benefit to the owner of the policy in any calendar year to help offset, or perhaps even cover completely, the medical costs associated with a chronic illness. This is the equivalent of 2% per month.

Accelerated Benefits Riders
ABR 3 - Critical Illness Heart Attack Stroke Cancer End stage renal failure Major organ transplant ALS (Lou Gehrig’s disease) Blindness Lump-sum distribution (discounted from death benefit) after 30 days Funds can be used for anything No additional cost The 3rd ABR rider that we offer is for Critical Illness. Election of ABR3 can be either partial or full and are paid in a lump sum. There is a 30 day wait – which means 30 days from the date of issue of the policy…………by today’s standards in terms of elimination periods, 30 days is typically the quickest amount of time that you are likely to see for any type of policy that pays a financial benefit while living. Again – a duly licensed medical Physician must certify for the company that the Insured does in-fact suffer from a critical illness. Please keep in mind that ABR3 is not available on rated cases. Form series 8165(0703)

Life Event Story

According to the Federal Reserve, the richest 10% Americans own
WHAT THE WEALTHY KNOW THAT MANY PEOPLE DON’T According to the Federal Reserve, the richest 10% Americans own over half of the tax-free investment gains built up in life insurance1. 50th to 90th percentile Own 38.4% Top 10% own 55.1% Has Life Insurance Has Life Insurance Families in bottom half of net-worth percentiles own just 6.5% of these tax-free assets! 1. Federal Reserve, 2007

THE EQUITY INDEX CONCEPT WHOSE TIME HAS COME
UPSIDE POTENTIAL When the stock market is up, an equity indexed product will return to you a portion of the stock market gain. DOWNSIDE PROTECTION However, during the years when the stock market is down, your equity indexed account will not lose any money. 09/ /2010 . 1on1 slide: talk about the equity indexed annuity here. Would you think American consumers are desperately looking for info like this? This is the last slide, based on what I shared with you, are you honestly interested in this? Our company is looking for sharp individuals right now. The graph is based on actual S&P 500 data and actual credited rates for the period shown on one of our indexed annuity products. These results should not be an indication that Indexed Annuities will outperform the S&P This simply demonstrates the effectiveness of Indexed Annuities in years when the S&P 500 was negative. .

Cash Value Upside growth potential Downside protection Accessibility
Interest credit is tied to the S&P 500 Index S&P 500 Index – A dynamic index that consists of the 500 largest companies in the US such as Exxon, Disney World, Walt Mart, Citigroup, Microsoft, McDonalds… etc. Downside protection Equity Index concept guarantees you could never lose your cash value due to a decline in the index Accessibility Tax free access after the 1st year via loans