Download IRA Strategies for Wealth Transfer

IRA Strategies for Wealth Transfer
Presenter
Title
Policies issued by American General Life Insurance Company ("AGL“)
FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
IMPORTANT INFORMATION
American General Life Insurance Company (AGL)
has financially sponsored this activity. Our
sponsorship of this activity creates a conflict of
interest to the extent that you consider our
sponsorship in rendering advice to your clients
regarding our products. As a result, you cannot
consider AGL's sponsorship in determining which
products to recommend to your clients.
FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
YOU ARE PROHIBITED FROM RECOMMENDING
OUR INSURANCE PRODUCTS TO CUSTOMERS
BASED ON INCENTIVES PROVIDED TO THE FIRM
AND ITS FINANCIAL ADVISORS
FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Today’s Objectives
Today I’ll demonstrate how you can
improve your client’s legacy
by describing what IRA investors typically do,
& comparing it to two simple but powerful ideas
so they can maximize their IRA legacy potential
and recognize the value you bring.
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Sources of Retirement Cash Flow
Pension
Social Security
Savings
Pension
Social Security
30 Years Ago
Savings
Today
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
IRAs and RMDs
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
RMDs vs. Account Value
8%
6%
14%
12%
4%
2%
10%
0%
8%
8%
6%
6%
3.6%
4%
2%
0%
70
75
80
85
90
RMDs as a % of Account Value
95
100
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Projected IRA Values
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
70
75
80
85
90
95
100
105
110
115
$100,000 IRA; 7% hypothetical annual return
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Typical IRA Transfer
IRA Owner(s)
Children
Grandchildren
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Typical IRA Transfer
IRA Owner(s)
$500,000
Children
$300,000
Grandchildren
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Story Selling
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
3 Circles
2 Questions
3-Point Value Proposition
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
3 Circles
Your money can go to three
places when you’re done with it:
L.O.
C
G
Cross out the one you would least like
to get your money when you’re done with it.
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Client Questions & Value Proposition
2 Questions:
1. Mr. & Mrs. Jones, if things go the way you have
planned, what’s going to happen to your IRA?
2. Why don’t you give it to them right now?
3-Point Value Proposition:
1. We’ll keep your IRA in your Care, Custody and Control;
2. Potentially double, triple or quadruple the value of your
legacy; and
3. Take no additional investment risk in your portfolio
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
IRA Wealth Transfer Strategies
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Typical IRA Transfer
IRA Owner(s)
Children
Grandchildren
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Typical IRA Transfer
IRA Owner(s)
$500,000
Children
$300,000
Grandchildren
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Life Insurance Solutions
for
IRA Wealth Transfer
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
1. IRA Income Tax Offset
IRA
RMD’s
Life Insurance
(equal to taxes)
Beneficiaries
Taxes
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
1. IRA Income Tax Offset
IRA
$500,000
RMD’s
Life Insurance
$200,000
Beneficiaries
$500,000
Taxes
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
2. IRA Income Tax Elimination
IRA
RMD’s
Life Insurance
(equal to IRA)
Charity
Beneficiaries
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
2. IRA Income Tax Elimination
IRA
$500,000
RMD’s
Life Insurance
$500,000
Beneficiaries
$500,000
Charity
$500,000
Tax-Free Total:
$1,000,000
FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
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Comparison of Strategies
Total Net After-Tax Legacy
$1,000,000
$900,000
$800,000
$700,000
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$0
Current
Tax Offset
Tax Elimination
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Do you remember our
3-Point Value Proposition?
1. We’ll keep your IRA in your Care,
Custody and Control;
2. Potentially double, triple or quadruple
the value to your beneficiaries; and
3. Take no additional investment risk in
your portfolio
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
The “Soft” Close
“I know you qualify for this program financially, but. . .
I don’t know if you qualify medically.”
You have time to think about it.
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Questions or Comments
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
IRA Strategies for Wealth Transfer
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Important Information
Policies issued by American General Life Insurance Company (AGL), a member of American
International Group, Inc. (AIG)
The underwriting risks, financial and contractual obligations and support functions associated with
the products issued by AGL its responsibility. Guarantees are subject to the claims-paying ability
of the issuing insurance company. AGL does not solicit business in New York.
Policies and riders not available in all states. Keep in mind that American General Life Insurance
Company and their distributors and representatives may not give tax, accounting or legal advice.
Any tax statements in this material are not intended to suggest the avoidance of U.S. federal,
state or local tax penalties. Such discussions generally are based upon the company’s
understanding of current tax rules and interpretations. Tax laws are subject to legislative
modification, and while many such modifications will have only a prospective application, it is
important to recognize that a change could have retroactive effect as well. Individuals should seek
the advice of an independent tax advisor or attorney for more complete information concerning
their particular circumstances and any tax statements made in this material.
©2014. All rights reserved.
AGLC107191-EJ
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FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION