For Financial Professionals only. Not for use with the general public. Income Planning Using FIA’s for Safe Money Case Study - Income Protection How PCN Can Assist
For Financial Professionals only. Not for use with the general public. Total Portfolio Age 55 Age 65 $1,000, % Withdrawal Age 55 Age % Yield $800,000 Value after 10 Years $1,600,000 Annual Income $64, % Withdrawal Investments 3.00% Yield $200,000 Value after 10 Years $268,783 Annual Income $10,750 Capital Preservation
For Financial Professionals only. Not for use with the general public. 7.20% Yield $800,000 Value after 10 Years $1,600,000 Annual Income $64, % Withdrawal Investments Total Portfolio $1,000, % Yield $200,000 Value after 10 Years $500,000 Annual Income $20, % Withdrawal Capital Preservation Necessary Yield Age 55 $200,000 Income value after 10 Years $400,000 Annual Income $20, % Withdrawal GMWB Age 55
For Financial Professionals only. Not for use with the general public. At 57, Nolan weathered the storm in 2007 & He maintained $1,000,000 of investable assets in June Today Nolan is 63 and wants to retire at age 67. Nolan’s Retirement Income Gap: $75,000 Nolan’s goal: Maximize income in retirement Nolan’s Concerns: Running out of income. How another market “correction” would effect his retirement income. Case Study
For Financial Professionals only. Not for use with the general public. The Goal in June 2009 AgeEnd YearInvestmentsSavings (4%)Portfolio Value 57$800,000$200,000$1,000, $857,600$208,000$1,065, $919,347$216,320$1,135, $985,540$224,973$1,210, $1,056,499$233,972$1,290, $1,132,567$243,331$1,375, $1,214,112$253,064$1,467, $1,301,528$263,186$1,564, $1,395,238$273,714$1,668, $1,495,695$284,662$1,780, $1,603,385$296,049 $1,899, % WD = $75,977
For Financial Professionals only. Not for use with the general public. Nolan’s Assets in June 2015 AgeEnd YearInvestmentsSavings (4%)Portfolio Value 57$800,000$200,000$1,000, % WD = $74, $1,600,00$253,064 $1,853,064 S&P500 Index on June 1, 2009: 943 S&P500 Index on June 1, 2015: % Increase
For Financial Professionals only. Not for use with the general public. Option 1: Stay the Course Savings $253,064 Investments $1,600,000 End Year 6 Total Portfolio Value = $1,853,064 4% Portfolio Withdrawal $74,123
For Financial Professionals only. Not for use with the general public. Savings $253,064 Investments $1,600,000 End Year 6 Total Portfolio Value = $1,853,064 4% Portfolio Withdrawal $74,123 Option 1: Stay the Course Market continues to grow at 30% Savings = 3% growth Savings $284,826 Investments $2,080,000 End Year 10 Total Portfolio Value = $2,364,826 4% Portfolio Withdrawal $94,593
For Financial Professionals only. Not for use with the general public. Option 1: Stay the Course Market remains flat – No growth Savings = 3% growth Savings $284,826 Investments $1,600,000 End Year 10 Total Portfolio Value = $1,884,826 4% Portfolio Withdrawal $75,393 Savings $253,064 Investments $1,600,000 End Year 6 Total Portfolio Value = $1,853,064 4% Portfolio Withdrawal $74,123
For Financial Professionals only. Not for use with the general public. Option 1: Stay the Course Savings $284,826 Investments $1,120,000 End Year 10 Total Portfolio Value = $1,404,826 4% Portfolio Withdrawal $56,193 Market declines (-30%) Savings = 3% growth Savings $253,064 Investments $1,600,000 End Year 6 Total Portfolio Value = $1,853,064 4% Portfolio Withdrawal $74,123
For Financial Professionals only. Not for use with the general public. FIA w/GMWB $800,000 Investments and Other Savings $1,053,064 End Year 6 Total Portfolio Value = $1,853,064 Option 2: Add GMWB Move $800,000 into an Indexed Annuity with a GMWB Rider Annual Income $74,123 ($600,000 from Investments and 200,000 from savings) Savings $253,064 Investments $1,600,000 End Year 6 Total Portfolio Value = $1,853,064
For Financial Professionals only. Not for use with the general public. Option 2: Add GMWB Market continues to grow at 30% FIA w/GMWB $863,388 Investments and Other Savings $1,359,724 End Year 10 Total Portfolio Value = $2,223,112 Annual Income $54,388 (4% Withdrawal) Annual Income $56,576 (Guaranteed from GMWB) Total Annual Income $110,964 FIA w/GMWB $800,000 Investments and Other Savings $1,053,064 End Year 6 Total Portfolio Value = $1,853,064
For Financial Professionals only. Not for use with the general public. Option 2: Add GMWB Market remains flat – No growth FIA w/GMWB $800,000 Investments and Other Savings $1,059,724 End Year 10 Total Portfolio Value = $1,859,724 Annual Income $42,389 (4% Withdrawal) Annual Income $56,576 (Guaranteed from GMWB) Total Annual Income $98,965 FIA w/GMWB $800,000 Investments and Other Savings $1,053,064 End Year 6 Total Portfolio Value = $1,853,064
For Financial Professionals only. Not for use with the general public. Option 2: Add GMWB Market declines (-30%) FIA w/GMWB $765,496 Investments $759,724 End Year 10 Total Portfolio Value = $1,525,220 Total Annual Income $86,964 Annual Income $56,576 (Guaranteed from GMWB) Annual Income $30,388 (4% Withdrawal) FIA w/GMWB $800,000 Investments and Other Savings $1,053,064 End Year 6 Total Portfolio Value = $1,853,064
For Financial Professionals only. Not for use with the general public. Summary: End Year 10 Hypothetical Income after 10 Years Stay the Course Add Indexed Annuity with GMWB Rider Market Gains (+30%) $94,593$110,964 ($56,576 Guaranteed) Market is Flat$75,393$98,965 ($56,576 Guaranteed) Market Declines (-30%) $56,193$86,964 ($56,576 Guaranteed)
For Financial Professionals only. Not for use with the general public. Summary: End Year 10 Hypothetical Results After 10 Years Stay the CourseAdd Indexed Annuity with GMWB Rider Market Gains (+30%) $2,364,825$94,593$2,223,112$110,964 Market is Flat$1,859,724$75,393$1,859,724$98,964 Market Declines (-30%) $1,404,825$56,193$1,525,220$86,964
For Financial Professionals only. Not for use with the general public. At 57, Nolan weathered the storm in 2007 & He maintained $1,000,000 of investable assets in June Today Nolan is 63 and wants to retire at age 67. Nolan’s Retirement Income Gap: $75,000 Nolan’s goal: Receive $75,000 of annual income from portfolio for life Nolan’s Concern: The impact of how another market “correction” would effect his retirement income. Case Study
For Financial Professionals only. Not for use with the general public. Summary: Assuming $75,000 Withdrawal Hypothetical Results After 10 Years Stay the CourseAdd Indexed Annuity with GMWB Rider Value Income W/D % Value Investments Income W/D % Market Gains (+30%) $2,364,825$75, %$2,223,112$1,359,724$75, % Market is Flat$1,859,724$75, %$1,859,724$1,059,724$75, % Market Declines (-30%) $1,404,825$75, %$1,525,220$759,724$75, %
For Financial Professionals only. Not for use with the general public.
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