Post on 27-Mar-2015
The Road to Your Retirement
Mapping Your Retirement Income Resources
Name of the speakerRegistered RepresentativeDate
3012548.X.P -2 C10-0811-010 (9/10)
Retirement - Insurance - Investments 2
Important Information
Insurance products, annuities and retirement plan funding issued by (third party administrative services may also be provided by) ING Life Insurance and Annuity Company ( Windsor, CT). Securities are distributed by ING Financial Advisers, LLC (member SIPC), Windsor, CT or through other broker/dealers with which it has selling agreements. Annuities may also be issued by ReliaStar Life Insurance Company (Minneapolis, MN) and ReliaStar Life Insurance Company of New York (Woodbury, NY). Variable annuities issued by ReliaStar Life Insurance Company are distributed by ING Financial Advisers, LLC. Variable annuities issued by ING USA Annuity and Life Insurance Company and ReliaStar Life Insurance Company of New York are distributed by Directed Service, LLC. Only ING Life Insurance Annuity Company and ReliaStar Life Insurance Company of New York are admitted and issue products in the state of New York. All companies are members of the ING Family of companies.
© 2011 ING North America Insurance Corporation.
Retirement - Insurance - Investments 3
Important Information
Insurance products, annuities and retirement plan funding issued by (third party administrative services may also be provided by) ING Life Insurance and Annuity Company ( Windsor, CT). Securities are distributed by ING Financial Advisers, LLC (member SIPC), Windsor, CT or through other broker/dealers with which it has selling agreements. Annuities may also be issued by ING USA Annuity and Life Insurance Company (Des Moines, IA) and are distributed by Directed Services, LLC. All companies are members of the ING Family of companies.
© 2011 ING North America Insurance Corporation.
Retirement - Insurance - Investments 4
Important Information
Securities and [financial planning] offered through ING Financial Partners, (member SIPC), 909 Locust Street, Des Moines, IA 50309 or through other broker/dealers with which it has selling agreements.
© 2011 ING North America Insurance Corporation.
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Important Information
Recordkeeping and Plan administrative services provided by ING Institutional Plan Services, LLC.
© 2011 ING North America Insurance Corporation.
Retirement - Insurance - Investments 6
Important Information
Framewor(k) and (k)Choice Recordkeeping and Plan administrative services provided by ING Institutional Plan Services, LLC. Mutual funds offered through ING Financial Advisers, LLC (member SIPC).
© 2011 ING North America Insurance Corporation.
Retirement - Insurance - Investments 7
Variable annuities, group annuities or funding agreements are long-term investments designed for retirement purposes. If withdrawals are taken prior to age 59 1/2, an IRA 10% premature distribution penalty tax may apply. Money taken from the annuity will be taxed as ordinary income in the year the money is distributed. An annuity does not provide any additional tax deferral benefit, as tax deferral is provided by the plan. Annuities may be subject to additional fees and expenses to which other tax-qualified funding vehicles may not be subject. However, an annuity does provide other features and benefits, such as lifetime income payments and death benefits, which may be valuable to you.
Variable investments, of any kind, are not guaranteed and are subject to investment risk including the possible loss of principal. The investment return and principal value of the security will fluctuate so that when redeemed, it may be worth more of less than the original investment. In addition, there is no guarantee that any variable investment option will meet its stated objective.
For 403(b)(1) annuities, the Internal Revenue Code (IRC) generally prohibits withdrawals of 403(b) salary reduction contributions and earnings on such contributions prior to death, disability and age 59 ½, severance of employment, or financial hardship. Amounts held in a 403(b)(1) annuity as of 12/31/1988 are “grandfathered” and are not subject to these restrictions. For 403(b)(7) custodial accounts, the IRC generally prohibits withdrawals of any contributions and attributable earnings prior to death, disability, age 59 ½, severance of employment, or financial hardship. For both 403(b)(1) annuities and 403(b)(7) custodial accounts, the amount available for hardship is limited to the lesser of the amount necessary to relieve the hardship, or the account value as of 12/31/1988, plus the amount of any salary reduction contributions made after 12/31/1988 (exclusive of any earnings).
You should consider the investment objectives, risk, and charges and expenses of the investment options carefully before investing. Fund prospectuses contain this and other information and can be obtained by contacting your local ING representative. Please read carefully before investing.
Important Information (continued)
Retirement - Insurance - Investments 8
Variable annuities, group annuities or funding agreements are long-term investments designed for retirement purposes. If withdrawals are taken prior to age 59 1/2, an IRA 10% premature distribution penalty tax may apply. Money taken from the annuity will be taxed as ordinary income in the year the money is distributed. An annuity does not provide any additional tax deferral benefit, as tax deferral is provided by the plan. Annuities may be subject to additional fees and expenses to which other tax-qualified funding vehicles may not be subject. However, an annuity does provide other features and benefits, such as lifetime income payments and death benefits, which may be valuable to you.
Variable investments, of any kind, are not guaranteed and are subject to investment risk including the possible loss of principal. The investment return and principal value of the security will fluctuate so that when redeemed, it may be worth more of less than the original investment. In addition, there is no guarantee that any variable investment option will meet its stated objective.
For 403(b)(1) annuities, the Internal Revenue Code (IRC) generally prohibits withdrawals of 403(b) salary reduction contributions and earnings on such contributions prior to death, disability and age 59 ½, severance of employment, or financial hardship. Amounts held in a 403(b)(1) annuity as of 12/31/1988 are “grandfathered” and are not subject to these restrictions. For 403(b)(7) custodial accounts, the IRC generally prohibits withdrawals of any contributions and attributable earnings prior to death, disability, age 59 ½, severance of employment, or financial hardship. For both 403(b)(1) annuities and 403(b)(7) custodial accounts, the amount available for hardship is limited to the lesser of the amount necessary to relieve the hardship, or the account value as of 12/31/1988, plus the amount of any salary reduction contributions made after 12/31/1988 (exclusive of any earnings).
All Guarantees are based on the financial strength and claims-paying ability of the issuing insurance company, who is solely responsible for all obligations under its policies.
You should consider the investment objectives, risk, and charges and expenses of the investment options carefully before investing. Fund prospectuses contain this and other information and can be obtained by contacting your local ING representative. Please read carefully before investing.
Important Information (continued)
Retirement - Insurance - Investments 9
You should consider the investment objectives, risk, and charges and expenses of the investment options carefully before investing. Fund prospectuses contain this and other information and can be obtained by contacting your local ING representative. Please read carefully before investing.
Important Information (continued)
Retirement - Insurance - Investments 10
This presentation/seminar contains information regarding insurance products for sale.
Important Information (continued)
Retirement - Insurance - Investments 11
Mapping Your Route – Have you chosen your course for retirement?
Length of Stay – How long will you be retired?
Speed Limit – What pace will you keep throughout retirement?
Expenses – How much will your retirement cost you?
Fuel – Where will your income resources come from?
Packing – Exactly what type of income resources will you need?
Itinerary – Have you segmented your resources for the journey?
Possible Detours – Are you aware of the risks to your resources?
GPS – How can a financial professional help you along the road?
Have you planned for…
Retirement Road Trip Checklist
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Mapping Your Route
The active reality of today’s retirees. Where will the road take you?
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Speed Limit
The speed you set for yourself may help to plan your income needs.
Max Speed – Revved up and raring to go
Speed Limit – Active but at a slower pace
Slow Lane – Taking it slow no rush
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Length of Stay
You may need to live without a paycheck for as long as you live with one.
A 65 year old male has a 50% chance of living past
A 65 year old female has a 50% chance of living past
81
84
SOURCE: Based on current Annuity 2000 Mortality Table assuming relatively good health. Society of Actuaries, Longevity: The Underlying Driver of Retirement Risk – 2005 Risks and Process of Retirement Survey Report (2006).
Employer’s checks Funding your future goals
25 35 45 55 65 75 85 95
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Expenses
How much money will you need to retire?
ING has many tools to help you find the answer.
•Your Number
•Determine Your Needs
•My RetirementWIZARD (coming soon)
•Retirement
•IncomeWizard
Retirement - Insurance - Investments 16
Fuel
60%
21%
19%
Personal Savings and Investments
Pension Plan*
Social Security*
*If applicable
Source: Social Security Brief #25, National Academy of Social Insurance, May 2007. Persons 65+, income $44k+
Most financial experts agree
that you’ll need to save
approximately 70%-80% of your current income for
each year you are retired
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Fuel
13
Where will your 60% of the fuel come from?
Some possibilities may include:
•Employer-sponsored retirement plans
• Investments
•Second Career
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Packing
What needs should you consider when sorting out retirement resources?
Guarantees
Flexibility
Growth
Inheritance
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Packing - Needs
What are your overall income needs?
Considerations Look for
How much? Income features
When to begin? Withdrawal features
How often and how long?
Who else needs income?
Cost?
Is the income guaranteed?
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Packing - ConsiderationsGuarantees
Considerations Look for
Trade-offsAnnual Withdrawals
Payment levels Series of payments
Company stability
Cost
Flexibility
Considerations Look for
Trade-offsInvestment decision making
Investment range Variable withdrawals
Cost
Growth PotentialConsiderations Look for
Time horizon Variety of options
Investment knowledge
Ways to diversify
Rebalancing
Cost
Passing on an inheritance
Considerations Look for
Trade-offs Income for spouse
Other life insurance Death benefits
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Itinerary
Segment your resources to ensure they will last throughout your journey.
12
3
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Itinerary – First Stop
Short-term money covers necessities.
What goes in:
•Social Security
•Pension
•Part-time employment income
•Benefits
• Investment income
What comes out:
•Food
•Housing
•Utilities
•Taxes, insurance
•Emergency reserves
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Mid-term money covers niceties.
What goes in:
•Retirement plans
• Interest / dividends
•Personal investments
•Home equity
• Income
What comes out:
•Travel
•Entertainment
•House / car repairs
•Education
Itinerary – Second Stop
Retirement - Insurance - Investments 24
Itinerary – Third Stop
Long-term money grows and replenishes.
What goes in:
•Long-term stocks
•Long-term bonds
•Other investments
What comes out:
• Income to compensate inflation or longevity
•Possible medical needs
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Itinerary – Pit Stop
22
Manage your money in the most effective method.
Liquidate taxable investments first
Maintain and invest tax-deferred funds as long as possible
Tap money in a ROTH IRA as a last resort
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Possible Detours
There can always be unexpected detours when mapping out your resources.
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Detour 1
Investment Risk: Withdrawing too much, too soon
1. Withdrawals assumed to be taken at beginning of year, and values on graph shown immediately after withdrawal.
2. Assumed annual return is 6.00 %
3. Assumed annual inflation rate is 3.69 %, the average annual inflation rate from 1947 - 2009. Source: Bureua of Labor Statistics, www.bls.gov/cpi
4. Initial withdrawal for each of the three scenarios is calculated as the scenario's withdrawal rate multiplied by initial amount of
$500,000. Each withdrawal thereafter increased from previous one by inflation rate.
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
12 years 16 years 25 years
Withdrawal Rate 9% 7% 5%
Annual Inflation-Adjusted Withdrawals as a % of a $500,000 Nest Egg
Retirement - Insurance - Investments 28
-
200.00
400.00
600.00
800.00
1,000.00
2009 2014 2019 2024 2029 2034
Year
Infl
ati
on
Ad
juste
d V
alu
eDetour 2
Inflation Risk: Losing purchasing power
Assumes 3.69% inflation, the average annual inflation rate from 1947 - 2009. Source: Bureau of Labor Statistics, www.bls.gov/cpi
Retirement - Insurance - Investments 29
Detour 3
Investment Risk: Investing too conservatively.
A starting account value of $50k is assumed. Based on S&P 500 (Performance of 500 industrial, utility, transportation and financial companies) returns from 3/1/1989 - 2/28/2009 and a ten year treasury bond purchased on 3/1/1989 and reinvested in a ten year treasury bond purchased on 3/1/1999.
This is a hypothetical illustration . One cannot invest directly in an index.
$-
$50,000
$100,000
$150,000
$200,000
$250,000
Mar
ch 1
989
Mar
ch 1
999
Mar
ch 2
009
Ac
co
un
t V
alu
e
50% Treasury
70% Treasury
30% Treasury
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GPS – Tools for the Road
Seeking professional assistance can provide assurance that you are on the right track.
We can offer you the tools and assistance to help you:
•Choose your retirement age
•Determine when you’d like to begin receiving benefits
•Decide how to design and manage your savings
•Convert savings to a potential income stream
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The ING Difference
Fresh approach to life planning
Straight talk about financial
realities
Personalized solutions that take the whole picture
into account
Retirement - Insurance - Investments 32
The Road to Your RetirementMapping Your Retirement Income Resources
Any questions?