Our Mission: Allianz Life Insurance Company of North America and Allianz Life Insurance Company of...
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Transcript of Our Mission: Allianz Life Insurance Company of North America and Allianz Life Insurance Company of...
Our Mission: Allianz Life Insurance Company of North America and Allianz Life Insurance Company of New York are the trusted authority in insured retirement solutions for consumers working with a financial professional.
ENT-913-N (R-10/2011)
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
Rethinking your Retirement
[Name, title]
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Retirement dream
We are living longer, healthier lives
Retirement is an opportunity to pursue hobbies, travel, visit with loved ones, etc.
But, for many of us, the real retirement dream may be to be financially independent
Need realistic retirement strategies to make that a reality
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Retirement reality
Procrastination today is common. Not often do we plan to fail, instead we fail to plan
Other issues are given higher priorities
Longer you wait, the harder to make up the difference
Even a few years can make a big difference
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
Year Start Add Interest rate Year end value1 $40,000.00 $200/month 5% $44,512.50
2 $44,512.50 $200/month 5% $49,255.80
3 $49,255.80 $200/month 5% $54,241.90
4 $54,241.90 $200/month 5% $59,483.00
5 $59,483.00 $200/month 5% $64,992.30
6 $64,992.30 $200/month 5% $70,783.40
7 $70,783.40 $200/month 5% $76,870.80
8 $76,870.80 $200/month 5% $83,269.70
9 $83,269.70 $200/month 5% $89,995.90
10 $89,995.90 $200/month 5% $97,066.20
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Never too early to start preparing for retirement
This hypothetical example is shown for demonstration purposes only and doesn’t represent any specific product or investment. These figures don’t reflect taxes or product fees and expenses.
Starting retirement savings early with $200/month additional savings at 5% per year over 10 years
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Retirement reality
Never too early to get started
Withdrawal rates also important
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Withdrawal rates are important
This chart shows how long retirement savings may last at a 4%, 5%, 6%,and 8% annual year-end withdrawal rate. The chart is a hypothetical example and assumes $500,000 beginning balance in retirement, a 3% annual inflation rate, and a 6% annual rate of return, compounded monthly. This hypothetical example does not represent the performance of any specific investment product, taxes, or product fees.
Rate of withdrawal
$700,000
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
65 80 88 95 110
8%
6%
5%4%
This chart is for illustrative purposes only.
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Agenda 1. Retirement today
2. Taking action
3. Refocus
4. Options
5. Putting it all together
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1
Retirement today
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Retirement landscape
Recent market turmoil adding to the fears of running out of money
Afraid to take action- Don’t know where we are at
in our retirement strategies - Are often afraid to find out
Job losses a reality- Fear of losing job or have
recently lost job
Other needs take priority
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Retirement today
Refocus on your retirement strategies Walk through where you are at
financially today Walk through where you want to
be to have a reasonable retirement tomorrow
Focus on what you can control
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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2
Taking action
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Taking action
1. Save more now Why don’t we save?
- It’s hard to do and includes unpleasant things like budgeting and doing without. However, it is often a necessity.
Save regularly through a variety of sources (401k, etc.)
Increasing savings now can mean less retirement income replacement needed later
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Saving more now can reduce amount of additional income needed later
$45,000
$5,000 401(k)
Pension
401(k)
$16,000
$7,000
$10,000
74%
Social Security
Today Retirement
This hypothetical example is for illustrative purposes only. The retirement income totals are for demonstration purposes only.
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Saving more now can reduce amount of additional income needed later
401(k)
This hypothetical example is for illustrative purposes only. The income totals are for demonstration purposes only. The additional savings is based on a 5% distribution over 20 years.
$45,000
$5,000 401(k)
Pension
401(k)
$16,000
$7,000
$10,000
74%
Today Retirement
Social Security
$15,000
$42,000
$3,000
90%
Assumes hypothetical 5% rate of distribution over 20 years
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Taking action
2. Control debt
3. Working longer
Pension delays
Social Security delays
4. Look at options to protect a portion of your income
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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3
Refocus on what you can control
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Refocusing
REFOCUS on retirement expense strategies
Focus on what you can control
Help manage expenses- Survival income- Desired income
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Refocusing on the levels of retirement expenses
Three levels of retirement expenses
Desired
Expenses
Legacy
Survival Expenses to cover your most basic needs
Lifestyle “extras”
Funds remaining for your beneficiaries
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Refocusing by reviewing sources of income
REVIEW sources of income
Help you gain control over sources by knowing where they are
- Social Security- Defined Benefit plans- 401(k)s
Please keep in mind that your producer must be currently registered with a broker/dealer to recommend the liquidation of funds held in securities products, including those within an IRA or other retirement plan, for the purchase of an annuity.
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Refocusing by reviewing sources of income
Seven sources of retirement income
Roth IRA
Sources of Income
Welfare or charity
Nonqualified Assets (NQA)
Traditional IRA
Employer sponsored plans
Social Security
Continued employment
The base
Employer-sponsored plans
Contributions and rollovers
Tax-deferred/tax-free
Mutual funds, CDs, stocks, bonds
Phase into retirement gradually
Not desirable
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Refocusing on income protection strategies
PROTECT a portion of your income
Supplementing defined contributionpension plans
Consider using annuities- More optional guarantees- Reliability of future income
Guarantees are backed by the financial strength and claims paying ability of the issuing company.
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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4
Options
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Options
Start with a clean mental slate
Rethink overall retirement strategies
- Rethinking income in place of accumulation
- You always have an asset base to work with
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Options
Refocus on additional retirement issues
- Beneficiaries updated/correct- Legacy- Life insurance
- In addition to the death benefit provided, some policies can guarantee replacement income if either primary wage earner dies
- Health care and long term care
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Options
Retirement accumulation stage
Retirement accumulation stage
Retirement income stage
Financial objective
Have enough money to retire
Asset allocation Portfolio allocation
Time horizon Known to retirement
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
Options
Retirement income stage
Retirement accumulation stage
Retirement income stage
Financial objective
Have enough money to retire Not outlive assets
Asset allocation Portfolio allocation Withdrawal
allocation
Time horizon Known to retirement Unknown to date
of death
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
Options
Rethinking retirement strategies
Retirement accumulation stage
Retirement income stage
Rethinking retirement strategies
Rethinking retirement expenses
Rethinking portfolio with longer-term goals
Rethinking retirement annuities
Financial objective
Have enough money to retire Not outlive assets
Asset allocation Portfolio allocation Withdrawal
allocation
Time horizon Known to retirement Unknown to date
of death
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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The average health care cost for a couple retiring in 2010?1
Options
Health care and long term care
We often look at our retirement strategies based on our current good health status
Even with good health today, properly prepare for possible future health issues or health care needs of tomorrow
$250,0001USAToday, “Study: Retired couple will need $250,000 for health care,” March, 25, 2010
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5
Putting it all together
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Putting it all together
What if there are gaps between accumulation and income needs?
Refocusing our retirement financial strategies
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Putting it all together
Five options for income/expense gaps
Options
Lower your expectations
Spend less and save more now
Decide to work longer
Take on more risk
Combination (or all) of above
Roth IRA
Sources of Income
Welfare or charity
Nonqualified assets (NQA)
Traditional IRA
Employer sponsored plans
Social Security
Continued employment
Desired
Expenses
Legacy
Survival
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Putting it all together
How do the 5 options work?
$ ne
eded
to s
uppl
emen
t inc
ome$ now (401(k))
$ additional (401(k)) $ more
70?
ConservativeModerateAggressive
Combination of all options
Current standardof living
Age45 65
Retirement
Time
This example is shown for illustrative purposes only and is not intended to predict or project future results. Your actual results will vary. Please note that with the potential for greater returns comes greater risk and volatility.
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Putting it all together
Current standardof livingCombination most effective
Age
$ ne
eded
to s
uppl
emen
t inc
ome$ additional (401(k)) $ more
65 68?
ConservativeModerate
45 65
Time
This example is shown for illustrative purposes only and is not intended to predict or project future results. Your actual results will vary. Please note that with the potential for greater returns comes greater risk and volatility.
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Rethinking retirement strategies
Rethink your retirement strategies
Refocus on what you can control- Use the strategic workbook
Review your existing retirement strategies
Protect your retirement future
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Summary 1. Retirement today
2. Taking action
3. Refocus
4. Options
5. Putting it all together
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
36
Wrap up
This presentation is designed to provide general information on the subjects covered. Pursuant to IRS Circular 230, it is not, however, intended to provide specific legal or tax advice and cannot be used to avoid tax penalties or to promote, market, or recommend any tax plan or arrangement. Please note that Allianz Life Insurance Company of North America and Allianz Life Insurance Company of New York, their affiliated companies, and their representatives and employees do not give legal or tax advice.
Guarantees are backed by the financial strength and claims-paying ability of the issuing company. Variable annuity guarantees do not apply to the performance of the variable subaccounts, which will fluctuate with market conditions.
Purchasing an annuity within a retirement plan that provides tax deferral under sections of the Internal Revenue Code results in no additional tax benefit. An annuity should be used to fund a qualified plan based upon the annuity’s features other than tax deferral. All annuity features, risks, limitations and costs should be considered prior to purchasing an annuity within a tax-qualified retirement plan.
Not FDIC insured • May lose value • No bank or credit union guarantee • Not a deposit • Not insured by any federal government agency or NCUA/NCUSIF
Products are issued by Allianz Life Insurance Company of North America, 5701 Golden Hills Drive, Minneapolis, MN 55416-1297. www.allianzlife.com. In New York, products are issued by Allianz Life Insurance Company of New York, One Chase Manhattan Plaza, 38th Floor, New York, NY 10005-1423. www.allianzlife.com/newyork/. Variable products are distributed by their affiliate Allianz Life Financial Services, LLC, member FINRA, 5701 Golden Hills Drive, Minneapolis, MN 55416-1297. www.allianzlife.com. Only Allianz Life Insurance Company of New York is authorized to offer annuities and life insurance in the state of New York.
Allianz Life Insurance Company of North AmericaAllianz Life Insurance Company of New York
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Thank you!Questions?