destination: retirement name of the speaker registered representative date c09-0403-007 (05/09)finra...
TRANSCRIPT
Destination: Retirement
Name of the speakerRegistered RepresentativeDate
C09-0403-007 (05/09) FINRA Filing # _____________________
Explore the Possibilities
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.
© 2009 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.
© 2009 ING North America Insurance Corporation.
Retirement - Insurance - Investments 4
Important Information
Securities and [financial planning] offered through ING Financial Advisers, LLC (member SIPC), One Orange Way, Windsor, CT, 06095-4774.
© 2009 ING North America Insurance Corporation.
Retirement - Insurance - Investments 5
Important Information
Recordkeeping and Plan administrative services provided by ING Institutional Plan Services, LLC.
© 2009 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).
© 2009 ING North America Insurance Corporation.
Retirement - Insurance - Investments 7
Important Information (continued)
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 50 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.
Retirement - Insurance - Investments 8
Important Information (continued)
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 50 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.
Retirement - Insurance - Investments 9
Important Information (continued)
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.
Retirement - Insurance - Investments 10
Important Information (continued)
This presentation/seminar contains information regarding insurance products for sale.
Retirement - Insurance - Investments 11
Today, we will…
• Define your journey.
• Determine how to help you get there.
• Chart your course.
YOU YOU COULD COULD BE BE HEREHERE
DEFINE YOUR JOURNEY
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 13
• Set your goals
• Prioritize objectives
• Specify dollar amount and time frame
• Make periodic direction checks
Focus on Your Future
Don't simply retire from something; have something to retire to.
Harry EmersonFosdick
‘‘‘‘
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 14
Your Retirement. Your Future.
What’s most important to your retirement?
Longer life
Better healthEarly/late retirement
Active lifestyle
Leisure activitiesVacation home
Personal savings
Lower healthcare costs
Your legacy
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 15
8465-year old female: 1 in 2 chance of living past age
8165-year old male: 1 in 2 chance of living past age
Your Time in Retirement
How long do you expect to live in retirement…the next 1/3 of your life?
The truth is, you may need to live without a paycheck, as long as you have lived with one. How much will you need?
Employer’s checks
Funding for your future goals
25 35 45 55 65 75 85 95
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).
You
r A
ge
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 16
Funding Your Retirement
OtherPersonal Savings,
Part-Time Work60%
Pensions* orOther Savings
21%
SocialSecurity*
19%
SOURCE: Social Security Brief #25, National Academy of Social Insurance, May 2007. Persons 65+, income $44k+
No matter what goes into yours, chances are, your
own personal savings will be the biggest
piece of the pie.
*If applicable
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 17
Maximize Your Savings
Pay per paycheckPre-tax plan savings
Taxable IncomeFederal income tax withheldAfter-tax regular savings
Take-home pay
Tax savings per paycheck
After-taxRegular Savings
$4,000 0
4,000 -1,000 -240
$2,760
—
Pre-taxPlan Savings
$4,000 -240
3,760 -940 0
$2,820
$60
This hypothetical illustration is for demonstration purposes only. It assumes an annual salary of $48,000, monthly paychecks, and a savings of 6 percent of pay each paycheck. In addition, it assumes a single filing status and a federal tax rate of 25 percent. It ignores deductions for state income tax, Social Security and Medicare. The illustration is not intended to serve as financial advice or as a primary basis for your investment decisions. It does note imply the performance of any specific security. Pre-tax contributions into tax-deferred investments are subject to Internal Revenue Code limits. Taxes are generally due upon withdrawal.
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 18
How Much Will You Need?
• ING has many tools to help you find the answer
• Determine Your Needs
• My RetirementWIZARD (coming soon)
• Retirement
• IncomeWizard
• Your Number
Your Number is your goal and the total amount of money you need to retire how you want…
It’s a quick and simple calculation use the automated calculator at:
www.ingyournumber.com
Remember, every retirement plan should begin with a goal.
DETERMINE HOW YOU’LL GET THERE
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 20
Investing Tips
• Don’t…
• try and pick one “right investment”
• settle for just any mix of investments
• try to get in and out of the market at the “right time”
• Do…
• understand your investment options
• review the importance of diversification and asset allocation
• understand dollar cost averaging
• maximize your savings
• revisit, review, rebalance
Note: Dollar cost averaging does not ensure a profit nor guarantee against loss. Investors should consider their financial ability to continue their purchases through periods of low price levels
The question isn't at what age I want to retire, it's at what income.
George Foreman
‘‘‘‘
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 21
The Basics
An investment portfolio consists of a combination of three main investment classes:
S T O C K S B O N D S C A S H (Equivalents)
• Equity investments
• Classified by
• Company size
• Geography
• Style
• Fixed income securities
• Classified by
• Issuer type
• Geography
• Default risk
• Duration
• Money Market Instruments
• Fixed accounts
• Guaranteed accumulation accounts
• Stable value funds
• Evaluate performance
• Consider risk
• Examine fees
• Consider bonds backing
• Maturity dates
When considering stocksWhen considering bonds
• Consider accessibility of assets in case of an emergency
• Consider guarantees based on claims paying ability of the issuer
When considering cash
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 22
A Different Mix of Investments
Lower Risk/Lower Return Higher Risk/Higher Return
Understanding your options
CONSERVATIVEThe lower the risk potential,
the less likely the reward.
MODERATE AGGRESSIVEThe higher the risk potential,
the more likely the reward.
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 23
CA
SH
Diversify, Diversify, Diversify
You’ve heard this phrase before –
Don’t put all your eggs in one basket.
• Diversification is a simple way to manage investment risk
• The concept involves spreading your dollars among a variety of investments
Your Portfolioexample
BO
ND
S
CA
SH
BO
ND
S
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 24
The Subtle Difference
Diversification vs. Asset Allocation
Diversification involves spreading your dollars among a variety of investments, but doesn’t necessarily involve different asset classes.
Asset Allocation involves dividing a portfolio among and within different asset classes (such as stocks, bonds and money market instruments).
It’s not just about spreading your money across different investments…
…It’s about deciding
how much to allocate to
each asset class.
Retirement - Insurance - Investments 25
1976-2008 Average Annualized Rate of Return = 10.22%
These unmanaged indexes are not intended to represent specific mutual funds. Investors cannot invest directly in an index. Individual results may vary to management fees, transaction costs and taxes. Performance figures do not take into account the fees and expenses of investing in mutual funds or variable products. Past performance is no guarantee of future results. The S&P 500 is the benchmark indicator of the overall US stock market condition. It is based on the average performance of the common stock (ordinary shares) of the 500 largest US firms.
Source: Thomson Financial Company; Standard & Poor’s 500 Index Composite Total Return as of 12/31/2008
Year
Ret
urn
-50.00%
-40.00%
-30.00%
-20.00%
-10.00%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
'76 '78 '80 '82 '84 '86 '88 '90 '92 '94 '96 '98 '00 '02 '04 '06 '08
Stock Market Performance Over Time
Expect Ups and Downs
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 26
Put Your Money to Work for You
15
J F M A M J J A S O N D
$10
$8
$6
$4
$2
0
CO
ST
PE
R S
HA
RE
Use DOLLAR COST AVERAGING to systematically invest.
INVESTOR A
Single investmentof $1,200 at $8/share.Share Total:
INVESTOR B
12 monthlyinvestments of $100.Share Total:
33 53 103 116 136 143 168 182 192 203 217240
150
Dollar Cost Averaging does not ensure a profit nor guarantee against loss. Investors should consider their financial ability to
continue their purchases through periods of low price levels.
1DEFINE YOUR JOURNEY
Retirement - Insurance - Investments 27
Revisit, Review, Rebalance
For illustrative purposes only. This example may not reflect your actual situation.
Smart investors are disciplined, not emotional
Reallocate back to original
REBALANCE your assets.
REVISIT your goals.
Original Allocation
Portfolio grows and allocation shifts with
time
REVIEW your portfolio.
CHART YOUR COURSE
3CHART YOUR COURSE
Retirement - Insurance - Investments 29
Save Today. Your Future is Tomorrow.
CONSULT A FINANCIAL PROFESSIONAL
• Even experienced investors enlist the expertise of a financial professional
• Third-party input can ensure you’re acting on knowledge – not assumptions
No Need To Go It Alone
3CHART YOUR COURSE
Retirement - Insurance - Investments 30
Time to Take Action
Read on the topic.
See your benefits manager.
Check the Internet.
Consult a professional.
Destination: Retirement
Any Questions?
Explore the Possibilities