You earned it. Now enjoy it.
Transcript of You earned it. Now enjoy it.
You earned it. Now enjoy it.
MassMutual RetireEaseSM
Single Premium Immediate Annuity
An Income Annuity Guidefor Individuals
Once you retire, your only job should be to enjoy life.Whether you want to travel, keep working part-time at something you enjoy or just relax, your retirement represents the sum of everything you’ve worked for.
Massachusetts Mutual Life Insurance Company (MassMutual) is a company that specializes in retirement income solutions. We offer a product designed to help you enjoy your retirement knowing that you can create a guaranteed stream of income that isn’t affected by what happens in the financial markets.
Contents 3 | How long will you
need income? 5 | MassMutual RetireEase 6 | Help take control of your
retirement income 7 | Income for your lifetime
starts here 10 | Fast Facts
NOT FDIC OR NCUA INSURED • NOT A BANK DEPOSIT • NOT BANK GUARANTEED NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
Guarantee is based on the claims-paying ability of the issuing company.
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Retirement income planning is very different from the process of accumulating assets. As you get closer to retirement, it’s important to understand some of the challenges you may face. Your financial professional can work with you to create an income strategy that helps balance these challenges.
Challenges that may impact your retirement
Increased longevityAdvances in medicine and technology are allowing people to live longer,
putting a bigger strain on saving.
How long will you need income?The answer: Nobody knows!
Guarantee is based on the claims-paying ability of the issuing company.
Source: Annuity 2000 Mortality Table, Society of Actuaries.
Living longer, spending more time in retirement
Female Male Couple(either)
Prob
abili
ty
Age 85
Age 90
Age 95
100%
80%
60%
40%
20%
0
Probability of 65-year-olds living to certain ages:
There is a 63% chance that one spouse of a couple who are both age 65 will live to age 90 – spending about 25 years in retirement.
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Inflation remains a threatThe longer people live, the more inflation will erode the purchasing power
of their assets and income. At a minimum, retirement income needs to keep
pace with inflation to help maintain your standard of living.
Soaring medical costs The cost of medical care is soaring well beyond the average inflation rate
and retirees are bearing the burden.
Source: EnCorr®, Morningstar® as of 12/31/08.
Income pattern to maintain standard of living
$300,000
$200,000
$100,000
$0
emocni
age
$70,000 $102,132 $149,014 $217,416 $317,218
Annual income needed to keeppace with inflation:
60 65 70 75 80 85 90 95 100
Annu
al
Average price increase and costs of medical services and goods
Average annual price increase – From 1994 to 2005*Retail prescription drugs 8.3 %
National average cost of long term care** Home health aide $4,623 (per month for 8 hours a day)
Assisted living facility $2,969 (per month)
Nursing home $77,745 (annual, private room)
Sources:
* Kaiser Family Foundation calculations using data from National Association of Chain Drug Stores, “Industry Facts-at-a-Glance,” at http://www.nacds.org, based on data from IMS health.
** MetLife Mature Market Institute, Market Survey of Adult Day Services and Home Care Costs, September, 2007, The MetLife Market Survey of Nursing Home and Assisted Living Costs, October 2007.
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Perhaps it’s time you applied for the job of enjoying lifeMassMutual RetireEaseSM
MassMutual RetireEase is a single premium immediate annuity (also known as an income annuity). The contract provides a reliable and predictable stream of income for as long as you live, or for a period of time you elect.
Key benefits and features: • Guaranteed income – A stream of guaranteed income payments can
last for life or for a period of time you select.1
• Predictability – A fixed annuity’s income stream is not affected by
fluctuations in the stock market. At the time you purchase a contract,
you know how much income you will receive and when.
• Tax efficiency – If you’ve already paid taxes on the money used to
purchase the annuity contract, a portion of each annuity income
payment is tax-free until your single premium payment amount has
been recovered.
• Flexibility – MassMutual RetireEase offers you a certain amount
of flexibility, including the ability to:
– Add an inflation protection feature – when elected, MassMutual
Inflation ProtectorSM will automatically increase income
payments by 1%, 2%, 3% or 4% annually. This feature may only
be added when a contract is issued.
– Access cash withdrawals2 – Income payment options that
include a period certain allow you to access cash withdrawals
through the contract. Be sure to review your need for withdrawals
with your financial professional before purchasing a contract.
– Adjust a period certain – If you choose a period certain-only
income payment method, you can decrease or increase the
period of time you will receive income payments.
– Select a payment option that provides for your heirs – Certain
annuity payment options provide benefits to heirs, as long as
they are named beneficiaries on your contract at the time of
your death.
1 Guarantee of an annuity income stream is based on the claims-paying ability of the issuing company.
2 Income taxes, tax penalties, a surrender charge and certain restrictions may apply to withdrawals.
Enjoying life shouldn’t require a lot of hard work.
A MassMutual RetireEase annuity is a smart and simple way to add a guaranteed income solution to your overall retirement plan.
It offers single premium simplicity and automatically generates a stream of income that is not affected by what happens in the financial markets.
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With the help of your financial professional, you should discuss the type of retirement lifestyle you want and estimate what your retirement expenses will be. Next, evaluate the assets available to help fund your retirement. Finally, compare the products and services that can help convert your retirement savings into retirement income.
Help take control of your retirement income Enjoying life is a skill that can be learned
Steps for designing income with MassMutual RetireEaseSM
Pay single premium
Receive income payments
1 Select income payment option
2 Select income payment frequency
3 Evaluate additional features
The contract provides a guaranteed and predictable stream of income payments to you by check or direct deposit. The payments must begin within a 12-month period after you pay the single premium.
You begin by paying a single premium into a MassMutual RetireEase contract.
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• Installment refund – Payments will be made for as
long as you live. If you die before the total amount of
income payments received equals the single premium
amount paid for your contract, the difference will
continue to be paid as scheduled income payments
to your beneficiary.
• Period certain – Payments will be made for as long
as you live or a guaranteed period of time, whichever
is longer. If you die before the end of the guaranteed
period, your beneficiary will receive the remaining
income payments. If you live beyond the guaranteed
period of time, payments continue for as long as
you live.
Joint & Survivor Life
Payments last as long as either of two people (annuitant
or joint annuitant) is alive. The income payments go to the
surviving annuitant upon the first death. All payments end
upon the death of both annuitants.
If you choose, the joint and survivor option can be combined
with the following:
• Installment refund – Payments will be made for
as long as one of two annuitants is alive. If both
annuitants die before the total amount of income
payments received equals the single premium amount
paid, the difference will continue to be paid as
scheduled income payments to the beneficiary.
• Period certain – Payments will be made for a
guaranteed period of time, or for as long as either
annuitant lives, whichever is longer. If both
annuitants die prior the end of the guaranteed period,
the beneficiary will receive the remaining payments.
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When it comes to enjoying life, there is no glass ceilingLifetime income starts here...
You can fund a MassMutual RetireEase annuity contract by
rolling over assets from an individual retirement account
and/or an employer-sponsored plan, such as a 401(k). You
can also fund the annuity by using a portion of your current
savings. Because the minimum single premium is $10,000,
you have the flexibility to fund your contract with only a
portion of your overall assets.
Step 1 – Select your income payment optionAnnuity payments provide a guaranteed income for life, a
specific period of time or a combination of both. The best
choice for you will depend on many factors, including
whether you want income for one life or two (a spouse),
if you want to leave money to a beneficiary, or if you
foresee a need to access cash through your contract.
Three basic annuity payment options
Single Life
Payments last for as long as a person (annuitant) lives.
If you choose, the single life option can be combined with one
of the following:
• Cash refund – Payments will be made for as long as
you live. If you die before the total amount of income
payments received equals the single premium amount
paid for your contract, the difference will be paid in a
lump sum to your beneficiary.
You’ll receive a steady stream of income payments by check or through direct deposit. Because this is an immediate annuity, income payments must begin within the 12-month period after you pay the single premium.
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Period Certain-Only
Payments continue for a specific period of time. You can choose from five
years up to 50 years. If you die before the end of the guaranteed period,
your beneficiary will receive the remaining income payments. A period
certain-only option is a non-lifetime income payment method. With this
payment option only, the period may be lengthened or shortened after the
first contract year, subject to certain restrictions.
Income annuities do not provide any additional tax advantage when used to
fund a qualified plan. Investors should consider buying an income annuity
to fund a qualified plan for the annuity’s lifetime income feature.
Step 2 – Select payment frequencyThe frequency of payments will depend on how often you wish to receive
income for purposes of planning your budget and lifestyle. You can choose
to receive income payments:
• monthly,
• quarterly,
• semi-annually, or
• annually.
Step 3 – Evaluate additional features
Inflation protection feature
MassMutual Inflation ProtectorSM is an optional feature available to you.
When elected, the feature can help offset the effects of inflation on your
income payments’ purchasing power.
The feature automatically increases the amount of each payment by 1%,
2%, 3% or 4% each year. The feature and percentage may only be chosen
when your contract is issued and may not be changed. The higher the annual
percentage increase, the lower your initial payment will be. If you are
considering adding this to your contract, you should weigh the trade-off of
a smaller initial income amount in order to get increasing income over time.
This example is for illustrative purposes. Actual fixed payments change based on current interest rates.
Protecting purchasing power of income payments
$1,000
$750
$500
$25050 10 15 20
$927$859$794$725$655
0% 1% 2% 3% 4%
initial payment
20-yearpayment
years
Hypothetical example: MassMutual Inflation Protector SM
Assumptions:Male, age 65$100,000 single premium Single life with 10-year period certainMonthly payments
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Cash withdrawal feature
A MassMutual RetireEase annuity offers a withdrawal feature on contracts
with payment options that include a period certain.
If you elect a period certain-only payment option, one full or partial
withdrawal is allowed each year, after the first contract year. If you elect a
single life or joint and survivor life payment option, one partial withdrawal
is allowed per year after the first contract year.
The minimum withdrawal amount is $5,000. For a period certain-only
contract, the maximum withdrawal amount is the present value of all
remaining future period certain payments, less any surrender charges. For a
life with period certain contract, the amount available for a partial withdrawal
is limited so that each remaining guaranteed payment is at least $100. A
surrender charge will apply to withdrawals taken during contract years two
through nine. The surrender charges are shown at the end of this brochure.
If all annuitants named in a contract die before the end of the period certain
elected, the beneficiary can choose to take a full cash withdrawal or continue
to receive all future income payments due. If a full cash withdrawal is taken
immediately after the death of the annuitant (or last surviving annuitant, if a
joint and survivor life contract), no surrender charge will apply.
Consider carefully how important it is to have access to cash.
Immediate annuities are designed first and foremost to provide lifetime income payments that are typically higher than other methods of generating lifetime income, all other things being equal. As such, while access to cash withdrawals is an available feature, other products and services may be more appropriate if liquidity is of critical importance to you. Income taxes, tax penalties, a surrender charge and certain restrictions may apply to withdrawals.
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Issue ages (annuitant)Lifetime payment options: 18-90
Period certain-only payment options: maximum age 100
Issue age is based on an “age nearest” calculation. An age
is equal to 6 months prior to and after the stated age.
For example:
89 yrs., 6 months, 1 day = age 90
90 yrs., 6 months = age 90
Minimum single premium$10,000 (Consult with your financial professional for
maximum limit.)
Income payment options• Single Life
• Single Life with cash refund
• Single Life with installment refund
• Single Life with period certain
• Joint & Survivor Life
• Joint & Survivor Life with installment refund
• Joint & Survivor Life with reduction at first death
• Joint & Survivor Life with period certain
• Joint & Survivor Life with reduction at first death and period certain
• Period Certain-Only (Length of period can range
from 5 to 50 years.)
Income start dateWithin 12 months of contract issue.
Income payment frequency choicesMonthly, Quarterly, Semi-Annually or Annually
Fast FactsMassMutual RetireEase Single Premium Immediate Annuity
Inflation protection (optional feature)MassMutual Inflation ProtectorSM
• Automatically increases income payments by a
specific percentage each year – 1%, 2%, 3% or 4%.
• Can only be chosen at time of contract issue and may
not be cancelled or changed.
• No additional charge.
Cash withdrawals (surrenders)Available on contracts with income payment options that
include a period certain.
Period certain-only: One full or partial withdrawal allowed
per year after the first contract year. A partial withdrawal
reduces future period certain payment amounts.
Life with period certain: One partial withdrawal allowed
per year after the first contract year. The withdrawal reduces
future period certain payment amounts, but does not alter the
life payments.
Minimum withdrawal
$5,000 (Partial withdrawals are limited so that each
remaining guaranteed payment is at least $100.)
Maximum withdrawal
Present value of all remaining period certain payments,
less any surrender charges.
Surrender charges
Surrender charges (as a percent of amount withdrawn)
Contract Year 1 2 3 4 5 6 7 8 9 10+
Charge NA 8% 7% 6% 5% 4% 3% 2% 1% 0
State restrictions apply to surrenders.
Withdrawals are not allowed for contracts issued in Oregon.
Founded in 1851, Massachusetts Mutual Life Insurance Company (MassMutual) is a mutually owned financial protection, accumulation and income management company with a long history of financial strength and growth.
Our mutual company structure enables us to manage with the long-term interests of our customers in mind, and aligns the company’s interests with those of our policyholders.
Visit us at www.massmutual.com for details about our financial strength.
MassMutual – A history of strength and stability
© 2010 Massachusetts Mutual Life Insurance Company, Springfield, MA. All rights reserved. www.massmutual.com. MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual) and its affiliated companies and sales representatives. CRN201206-135972
AN1500 810
MassMutual RetireEaseSM [SPIA05, SPIA05 (NC) in North Carolina] is a single premium immediate annuity contract issued by Massachusetts Mutual Life Insurance Company, Springfield, MA 01111-0001.
The product and/or certain features may not be available in all states.
The information contained in this communication is not written or intended as tax or legal advice. Neither MassMutual nor any of its employees or representatives is authorized to give tax or legal advice. The information provided herein may not be relied on for purposes of avoiding any federal tax penalties. Individuals are encouraged to seek tax or legal advice from an independent professional advisor.