Protection for you and your spouse.

Transcription

1 YOUR GUIDE TO THE SPOUSAL PROTECTION FEATURE AVAILABLE WITH NATIONWIDE VARIABLE ANNUITY DEATH BENEFITS Protection for you and your spouse. Not a deposit Not FDIC or NCUSIF insured Not guaranteed by the institution Not insured by any federal government agency May lose value

2 Leave a lasting impression. As a married investor, retirement may bring concerns about the financial well-being of you and your spouse. Particularly, you may worry about making sure your spouse is taken care of if they outlive you. That s why most Nationwide variable annuity death benefits offer the Spousal Protection Feature (SPF). It gives you the opportunity to extend the guaranteed death benefit to cover either spouse, regardless of who passes away first. It s like having dual air bags: protection for both passengers.

3 Annuity basics. An annuity is a long-term, tax-deferred investment you buy from an insurance company to help you save for retirement. It allows you to create a fixed or variable stream of income through a process called annuitization and also provides a variable rate of return based on the performance of the underlying investments. But, as with most things in life, an annuity does have limitations. If you decide to take your money out early, you may face fees called surrender charges. Plus, if you re not yet 59½, you may also have to pay an additional 10% tax penalty on top of ordinary income taxes. A death benefit is available with most variable annuities, and naturally, if you do take an early withdrawal, your death benefit and the contract value of the annuity contract will be reduced. You should also know that an annuity contains guarantees and protections that are subject to the claims-paying ability of Nationwide Life Insurance Company. But these guarantees don t apply to any variable accounts, which are subject to investment risk, including possible loss of your principal.

4 Dual protection with a guaranteed death benefit. Spousal Protection Feature (SPF) When added to your variable annuity, SPF helps you and your spouse provide for each other regardless of who passes away first, even if only one spouse owns the contract. This could be especially important if you or your spouse pass away at a time when the markets and your contract value are down. Plus, it s available with IRA and non-ira variable annuities. One spouse must be named annuitant; the other must be named co-annuitant, and both spouses must be named as beneficiaries; maximum issue ages may vary based on the death benefit elected No other person may be named as contract owner, annuitant, co-annuitant or beneficiary How does this work for IRAs? Nationwide variable annuities are annuitant-driven, giving them more flexibility. That s important since IRAs typically have one account owner with a death benefit that s paid to the contract beneficiary. With SPF, an IRA account owner can be named annuitant and their spouse co-annuitant; both can be named a beneficiary. As a result, the death benefit will be paid to the surviving spouse, no matter which spouse passes away first. Let s look at an example Thomas bought a Nationwide variable annuity contract in his IRA. He named his wife, Jean, as co-annuitant and primary beneficiary. By his first contract anniversary, Mike s account value grew due to positive market performance. Because he purchased a One-year Enhanced Death Benefit rider that stepped-up and locked in the increase, his death benefit value increased on his first contract anniversary. After that, Thomas's account value fell, and Jean passed away shortly afterward. Contract value () Thomas continued the contract at the stepped-up death benefit value and named his daughter, Sarah, as a new beneficiary. Thomas passes away while the death benefit value is still higher; Sarah receives this as a lump-sum payment. Original contract value Contract value on first anniversary Contract value at Jean s death Contract value at Thomas death Contract value Death benefit value This example is hypothetical. It does not reflect the performance of any investment. If the owner takes a withdrawal, the death benefit and contract value will be reduced. One-Year Enhanced Death Benefit is available for an additional cost; the beneficiary will receive the greater of the contract value of the annuity, the total of all purchase payments made to the annuity, or the highest contract value on any contract anniversary prior to the annuitant s 81st birthday; please see the prospectus for details

5 Here s how the Spousal Protection Feature works: Thomas and Jean Contract: Thomas purchases a Nationwide variable annuity Owner/Annuitant: Thomas Co-Annuitant: Jean Beneficiary: Thomas and Jean Death Benefit: One-Year Enhanced Death Benefit with SPF First Contract Anniversary: Contract value has grown, death benefit value is set to higher amount Year Two: Contract value falls, Jean passes away shortly after Thomas purchases a Nationwide variable annuity SPF activated Jean named co-annuitant YES Jean named co-annuitant NO SPF not activated Jean passes away Jean passes away or No death benfit is paid and there is no change to Thomas contract; Thomas names a new beneficiary upon Jean s passing Thomas can take a lump-sum payout of the stepped-up death benefit value Thomas can continue his contract as the owner/annuitant at the stepped-up death benefit value Thomas names his daughter Sarah as a new beneficiary This example is hypothetical. It does not reflect the performance of any investment. If the owner takes a withdrawal, the death benefit and contract value will be reduced.

6 Dual airbags give you extra protection. Why not do the same for your retirement? Details to remember. Both spouses must be age 85 or younger* at the time of issue and be named co-annuitants and primary beneficiaries No other person may be named as contract owner, annuitant or primary beneficiary** SPF may have an additional cost; see your prospectus for details All guarantees are subject to the claims-paying ability of Nationwide Life Insurance Company Available with IRA or non-ira variable annuities Thomas Jean Contract owner Co-annuitant Primary beneficiary * Age may vary based on annuity product or optional enhanced death benefit selected ** A revocable trust may be named as the contract owner, as long as either or both of the spouses is/are grantor(s). This brochure is only authorized for client use when preceded or accompanied by a variable annuity product prospectus. The prospectus describes the investment objectives, risk factors, expenses, fees and surrender charges that may apply to you. You should read it carefully before purchasing a variable annuity. Variable products are sold by prospectus. The product prospectus and underlying fund prospectuses can be obtained from your investment professional, by visiting or by writing to Nationwide Life Insurance Company, P.O. Box , Columbus, Ohio Before investing, carefully consider the fund s investment objectives, risks, charges and expenses. The product prospectus and underlying fund prospectuses contain this and other important information. Read the prospectuses carefully before investing. Nationwide variable annuities are issued by Nationwide Life Insurance Company, Columbus, Ohio. The general distributor is Nationwide Investment Services Corporation, member FINRA. Nationwide, Nationwide is on your side and the Nationwide N and Eagle are service marks of Nationwide Mutual Insurance Company Nationwide VAM-0377AO.10 (09/15)