Guaranteed Income for Life (GIFL) Rollover Variable Annuity IRA

Transcription

1 Guaranteed Income for Life (GIFL) Rollover Variable Annuity IRA Exclusively available for 401(k) plan participants with the John Hancock Guaranteed Income for Life in-plan benefit Annuity contracts are issued and administered by John Hancock Life Insurance Company (U.S.A.), Boston, MA, which is not licensed in New York. In New York, annuity contracts are issued and administered by John Hancock Life Insurance Company of New York, Valhalla, NY. John Hancock annuities are distributed by John Hancock Distributors LLC, member FINRA.

2 Good News You can keep the benefits even if you leave your 401 If you are retiring or leaving your company and have some or all of your 401(k) contributions in the Guaranteed Income for Life option with John Hancock, you have a unique opportunity. You can roll over the market value of your investments 1 and your Benefit Base 2 into the Guaranteed Income for Life (GIFL) Rollover Variable Annuity IRA. By rolling over, you ll have access to similar investment choices and features as found within your 401(k) plan with John Hancock. YOUR GIFL DISTRIBUTION OPTIONS WITHIN A 401(k) PLAN WITH JOHN HANCOCK WHEN YOU RETIRE OR LEAVE YOUR CURRENT EMPLOYER: 2 Roll over to the Keep your money in your Roll over to a non-gifl IRA GIFL Rollover Variable 401(k) plan with John or transfer your money to Annuity IRA Hancock, if allowed by your plan a new employer s 401(k) plan Both the market value and Benefit Base at the time of the rollover are preserved. The Benefit Base may potentially increase with future step ups. The Lifetime guarantee charges an annual fee of 0.35% 3 of the Benefit Base. You can make additional purchase payments to the GIFL Rollover Variable Annuity IRA. 4 In retirement, you will receive income for life based on your Benefit Base. 5 Additional fees, restrictions and limitations may apply. See Frequently Asked Questions on page 7. John Hancock Life Insurance Company (U.S.A.) (John Hancock USA) and John Hancock Life Insurance Company of New York (John Hancock New York) herein collectively referred to as John Hancock. While still in plan, you will continue to enjoy the benefits of the Guaranteed Income for Life option. However, you cannot make any additional contributions into the Guaranteed Income for Life option and there may be different plan rules if you are no longer an active employee. In retirement, you will receive income for life based on your Benefit Base. 3 You will lose all of the features and guarantees of the Guaranteed Income for Life option. You will receive the market value of your investment in this option. 4 Take a cash distribution You will lose all of the features and guarantees of the Guaranteed Income for Life option. You will receive the market value of your investment in this option. Also, your distributions will be taxed as ordinary income and a 10% IRS penalty may be incurred for withdrawals prior to age 59½. 1 The term market value in this brochure refers only to the participant s investment in the Guaranteed Income for Life option within the 401(k) with John Hancock or the Guaranteed Income for Life Rollover Variable Annuity IRA. 2 Your Benefit Base is the amount that your Lifetime Income Amount is based off. It has no cash value and cannot be withdrawn. 3 The fee may increase to a maximum of 0.65% upon step up. Should the annual step-up fee increase, there is always the option to decline to step up and retain the previous Benefit Base and fee. See the prospectus for more details. 4 For more information see Frequently Asked Questions on page 7. 5 Bear in mind that future distributions will be taxed as ordinary income at then current tax rates. In addition, a 10% IRS penalty may be incurred for withdrawals prior to age 59½. The guarantee is backed by the claims-paying ability of the issuer, and does not apply to the investment performance or safety of the underlying portfolios. Not FDIC Insured No Bank Guarantee May Lose Value Not a Deposit Not Insured By Any Federal Government Agency

3 of Guaranteed Income for Life (k) plan with John Hancock. * Enjoy the same downside protection, upside potential, and income for life in your own GIFL Rollover Variable Annuity IRA. In a down market Even if your account value is less than your Benefit Base, the worst you can do by rolling over to the Guaranteed Income for Life Rollover Variable Annuity IRA is have your future income be based off of the higher Benefit Base amount. This would be true even if your account value fell to zero in the future. ROLLING OVER HELPS PROTECT YOUR FUTURE INCOME 6 Account Value Benefit Base Lifetime income amount = 5% of Benefit Base Years Step-up opportunities last through age 95 and can create a higher lifetime income amount In an up market If you choose to roll over to the Guaranteed Income for Life Rollover Variable Annuity IRA, your account value and Benefit Base will be rolled over dollar-for-dollar thereby locking in any potential gains. In addition, your Benefit Base might increase in the future with annual step ups in later years. Note that if your market value exceeds the Benefit Base on your contract s anniversary date, your Benefit Base will be reset to the higher amount thereby locking in potential gains. ROLLING OVER HELPS LOCK IN POTENTIAL GAINS 6 Account Value Benefit Base Lifetime income amount = 5% of Benefit Base Years Step-up opportunities last through age 95 and can create a higher lifetime income amount 6 These hypothetical examples are for illustration purposes only and are not a representation of past or future performance, or a guarantee of any kind. Actual results will vary. These hypothetical illustrations are not based on any GIFL Rollover Variable Annuity IRA portfolio, and do not reflect any contract or rider fees or charges. In markets with a 0% rate of return, no step up will be given. In all markets After you roll over to the Guaranteed Income for Life Rollover Variable Annuity IRA, you can make additional purchase payments. 7 When it s time to begin taking income, you will receive 5% of your Benefit Base, at that point in time, each year for the rest of your life (4.5% for the life of both you and your spouse, if you so choose). And if the market does well and your underlying account value exceeds your Benefit Base on any future rollover anniversary date (up to and including age 95), your income will be reset to a higher amount. 7 7 For more information see Frequently Asked Questions on page 7. *Refer to back cover. 3

4 Gain access to similar underlying portfolio options that are available within Guaranteed Income for Life inside your 401(k) plan. 8 Choose from professionally managed JHVIT portfolios, including Lifestyle portfolios. To determine which portfolio may be appropriate for you, call or visit John Hancock Variable Investment Trust Lifestyle Portfolio Choices JHVIT Lifestyle Balanced MVP JHVIT Lifestyle Conservative MVP JHVIT Lifestyle Growth MVP JHVIT Lifestyle Moderate MVP JHVIT Lifestyle Balanced PS Series JHVIT Lifestyle Conservative PS Series JHVIT Lifestyle Growth PS Series JHVIT Lifestyle Moderate PS Series John Hancock Variable Investment Trust Additional Portfolio Choices JHVIT Core Strategy JHVIT Franklin Templeton Founding Allocation JHVIT Ultra Short Term Bond Quarterly fact sheets for the individual portfolios are available at 8 The fees for these portfolios are not identical to the fees available in your in-plan benefit. 4 Diversification, asset allocation or rebalancing does not guarantee a profit or protect against a loss. Stocks of small or emerging companies have less liquidity than those of larger, established companies and are subject to greater price volatility and risk than the overall stock market. Investing in foreign securities and emerging markets entails greater risk, as well as greater potential rewards compared to U.S. investments. These risks include potential and economic uncertainties of foreign countries and less developed countries as well as the risk of currency fluctuations, price volatility, and lack of liquidity. These risks are magnified in countries with emerging markets, since these countries may have relatively unstable governments and less-established markets and economies. Investors should review the prospectus carefully for further information. Please note that asset allocation may not be appropriate for everyone, particularly those interested in directing the underlying portfolio options of their annuity contract on their own. The John Hancock Variable Investment Trust Portfolios described on this page are not mutual funds available to the retail public and are only available under John Hancock s variable annuity contracts or variable life insurance policies or through participation in certain tax-qualified retirement plans. The asset managers of these portfolios may also manage mutual funds available to the retail public with similar names and investment objectives. No representation is made, and no assurance is given, that any portfolio s investment results will be comparable to the investment results of any other fund, including retail mutual funds with the same asset manager. Past performance is no guarantee of future results.

5 Consider a financial tool that can help you meet your retirement income goals. Guaranteed Income for Life (GIFL) Rollover Variable Annuity IRA is a variable annuity, which is a long-term contract between an individual and an insurance company. A variable annuity can help you accumulate assets for retirement through tax deferral and a range of diverse portfolios for a balanced approach to retirement planning. The GIFL Rollover Variable Annuity IRA can only be purchased with 401(k) assets from a Group Annuity Contract issued by John Hancock Life Insurance Company (USA) or in New York through John Hancock Life Insurance Company of New York. When you purchase a variable annuity for any tax-qualified retirement plan, the variable annuity does not provide any additional tax-deferral treatment of earnings beyond the treatment provided by the plan. Consequently, you should purchase a variable annuity for a tax-qualified plan only on the basis of other benefits, such as living benefits that can help manage retirement income and death benefits for family protection. These are available for an additional cost. Variable annuities also offer flexibility when you are ready to receive retirement payments through distribution options that include systematic withdrawals and lifetime income payments. The GIFL Rollover Variable Annuity IRA may not be appropriate for individuals who do not foresee a need for liquidity and whose primary focus is tax deferral. Before considering the GIFL Rollover Variable Annuity IRA, please make sure the annuity is suitable for your financial goals and personal circumstances. Some withdrawals may reduce the Benefit Base. For more information, see Frequently Asked Questions on page 7. In addition, all withdrawals will be subject to ordinary income tax and, if made prior to age 59 1 /2, a 10% IRS penalty tax may apply. 5

6 Rolling over to the Guaranteed Income for Life Rollover Variable Annuity IRA is easy. To get started with your rollover or receive additional information: > Call > Visit 6 > Contact your plan s financial representative

7 Frequently Asked Questions What is the Guaranteed Income for Life (GIFL) Rollover Variable Annuity IRA? What is a variable annuity? How does the GIFL Rollover Variable Annuity IRA work? When can I start receiving lifetime income from the GIFL Rollover Variable Annuity IRA? Can I put more money into the GIFL Rollover Variable Annuity IRA? What is my lifetime income based upon? Can my lifetime income amount be paid out over the joint lives of both me and my spouse? Can my income ever increase after I begin receiving money? Can I withdraw money from the GIFL Rollover Variable Annuity IRA? How will that affect my lifetime income amount? What is the fee for the Guaranteed Income for Life feature in this rollover product? Are there any other fees associated with this product? Where can I get more information about the GIFL Rollover Variable Annuity IRA? It s a variable annuity that is exclusively available for terminating or retiring 401(k) plan participants with John Hancock who have money in the Guaranteed Income for Life option within the plan. The GIFL Rollover Variable Annuity IRA allows you to maintain the benefits of the Guaranteed Income for Life option. By using the GIFL Rollover Variable Annuity IRA, you will not need to pay any income taxes on your rollover amount until you start taking income or make a withdrawal. A variable annuity is a long-term contract between you and an insurance company, designed to help you grow your retirement assets and provide regular withdrawals when you are in retirement. The GIFL Rollover Variable Annuity IRA was designed to mirror substantially the Guaranteed Income for Life option in your 401(k) plan. You receive the same benefits of: downside protection, upside potential, and lifetime income. When you roll over to the GIFL Rollover Variable Annuity IRA, your 401(k) account value and Benefit Base are transferred, dollar-for-dollar. You also have access to investment choices that are similar to those available in the Guaranteed Income for Life option in your 401(k) plan. Each contract anniversary, your Benefit Base will step up if your account value is greater than the Benefit Base. The annual fee is 0.35% of the Benefit Base. The fee may increase to a maximum of 0.65% upon step up. Should the annual step up fee increase, there is always the option to decline to step up and retain the previous Benefit Base and fee. You can begin taking your lifetime income on any contract anniversary after age 59½ so long as you have satisfied the five-year holding period. The five-year holding period starts on the date of the first contribution into the Guaranteed Income for Life option in your 401(k) plan. Any remaining holding period will be carried over to the GIFL Rollover Variable Annuity IRA at the time of rollover. Also, the holding period is reset for any additional purchase payments if the additional purchase payments exceed 20% of the Benefit Base at the time of the payment; or, if the additional purchase payments, when combined with all other purchase payments made during the contract year, exceed 20% of the Benefit Base. Yes. Contributions can be made to your IRA for each year that you receive compensation and have not reached age 70½. For 2014, the annual contribution limit is $5,500 ($6,500 if you are age 50 or over). Also, you may make a one-time contribution of existing qualified plan assets (e.g., rollover IRA). The total amount of additional contributions made after the first Contract Anniversary is limited to $25,000 measured over the life of the contract. Note that you can make contributions after you begin receiving income. However, this may or may not increase your lifetime income amount. See the prospectus for more detailed information. Your lifetime income amount is 5% of your Benefit Base at the time of your first withdrawal (4.5% for you and your spouse, if you so choose). This applies to both the Guaranteed Income for Life option in your plan and the GIFL Rollover Variable Annuity IRA. You must be age 59½ and have satisfied the five-year holding period to begin taking lifetime income. Yes, so long as you have not already started to receive your lifetime income amount based only on your own life. Also, your joint lifetime income amount will be 4.5% of your Benefit Base. Yes. If your underlying portfolios perform well during retirement and your Benefit Base subsequently steps up, your lifetime income amount will be increased accordingly. Yes, you can withdraw your money any time you like without incurring any charges. If you do so prior to taking your lifetime income amount, your Benefit Base will be reduced by the amount of your withdrawal on a pro rata basis. If you withdraw money in excess of your lifetime income amount for any year after your lifetime income amount begins, your income and Benefit Base will also be adjusted on a pro rata basis. All withdrawals are subject to ordinary income taxes and a 10% penalty may apply. The fee for the Guaranteed Income for Life feature in the GIFL Rollover Variable Annuity IRA is currently 0.35%. See the prospectus for more detailed information. Yes. The GIFL Rollover Variable Annuity IRA also includes asset-based charges for daily administration, 0.15%, and mortality and expenses, 0.20%. When these fees are combined with the fee for Guaranteed Income for Life and the underlying portfolio expenses, the result is a similar, but not identical, cost structure as the Guaranteed Income for Life option in your plan. To view, download, or order a prospectus which includes fees, expenses, and investment options, call or visit 7

8 Now more than ever, it is important to partner with a company that has the ability to meet the promises it makes, both today and in the future. From our conservative product design, to our prudent investment philosophy, our approach has been protecting the financial future of our clients since *Annuity contracts are issued by John Hancock Life Insurance Company (U.S.A.). In New York, John Hancock Life Insurance Company of New York. Withdrawals in excess of the guaranteed lifetime income amount will reduce future guaranteed minimum withdrawal benefits proportionally. The guarantees provided are contingent on the election of a participant to roll over his or her benefits to a recipient rollover vehicle available from John Hancock upon termination of participation in the plan. Contact your financial advisor or visit for more information, including product and fund prospectuses that contain complete details on investment objectives, risks, fees, charges, and expenses, as well as other information about the investment company, which should be carefully considered. Please read the prospectuses carefully prior to purchasing. The prospectuses contain this and other information on the product and the underlying portfolios. Guaranteed Income for Life Rollover Variable Annuity IRA is distributed by John Hancock Distributors LLC, member FINRA. This brochure was prepared to support the promotion and marketing of the Guaranteed Income For Life Rollover Variable Annuity IRA. Neither John Hancock Life Insurance Company (U.S.A.), John Hancock Life Insurance Company of New York, John Hancock Distributors LLC, nor any of their representatives provide tax, accounting, or legal advice. Any tax statements contained herein were not intended or written to be used, and cannot be used, for the purpose of avoiding U.S. federal, state, or local tax penalties. Please consult your own independent advisor as to any tax, accounting, or legal statements made herein. Franklin and Templeton are registered trademarks of the Franklin Templeton Group. GIFL Rollover Variable Annuity IRA product features may vary, subject to state regulation. Variable annuities are not FDIC insured, are long-term contracts designed for retirement purposes, and are subject to investment risk, including the possible loss of principal. For use with policy form numbers VENTURE , VENTURE , VENTURE , VENTURE CERT-NY, VENTURE CERT-NY, and VENTURE CERT-NY. Withdrawals exceeding the lifetime income amount will reduce the Benefit Base. In addition, withdrawals will be subject to ordinary income tax and, if made prior to age 59 1 /2, a 10% IRS penalty tax may apply. While all variable portfolios are subject to market risk, some portfolios will experience greater volatility than others. Portfolios having the greatest volatility include those investing in one sector or industry, foreign countries, high-yield bonds, real estate securities, and small cap stocks. Before purchasing units in such a portfolio, you should carefully read the applicable risk section in the fund prospectus. Please consult the portfolio s current prospectus for complete information on its investments. The Company does not provide advice regarding appropriate portfolio allocations; please discuss this matter with your financial advisor. When considering an annuity for use in an IRA or other tax-qualified retirement plan (i.e., 401(k), 403(b), 457), it is important to note that there is no additional tax-deferral benefit, since these plans are already afforded tax-deferred status. Thus, an annuity should only be purchased in an IRA or qualified plan if some of the other features of the annuity are of value, such as access to specific portfolio choices, the ability to have guaranteed payments for life and other guaranteed benefits, and you are willing to incur any additional costs associated with the annuity to receive such benefits. See the prospectus for details. Issuer and Administrator John Hancock Life Insurance Company (U.S.A.), Lansing, MI (not licensed in New York) New York: John Hancock Life Insurance Company of New York, Valhalla, NY John Hancock Annuities Service Center P.O. Box Boston, MA New York Contracts: P.O. Box Boston, MA All rights reserved. ROP MLINY