Is Your Overall Financial Strategy In Sync?

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1 Is Your Overall Financial Strategy In Sync? We Can Help You Find The Answer.

2 Taking Time Out for a Valuable Review Like many people, you may have reached a point in life where you have accumulated significant assets to meet important savings and protection objectives. That can include retirement, funding for education, and ensuring your family can continue to enjoy a comfortable lifestyle if something were to happen to you. To reach those goals, you probably have purchased a variety of individual financial products over the years such as whole life or variable life insurance, mutual funds, fixed or variable annuities and other vehicles and bought them from different people, including your insurance agent, stockbroker, banker, or others. However, time has passed and there have been changes in your life. You may be wondering if the insurance and financial products you purchased in the past are still the right ones for you today. That s where Prudential Financial can help.

3 Getting More Control Over Your Financial Situation through Synchronization A licensed financial professional from Prudential can help ensure that you are presently on the right path by evaluating your current situation through a process called asset synchronization. He or she will look at your complete financial picture, including your current and future objectives and help ensure that the products you own are working in sync to meet your goals. Your financial professional will focus on four key elements of the asset synchronization process: Asset Allocation Do you have one overall asset allocation strategy in place (including stocks, bonds, cash) or do you have separate asset allocations for each individual insurance and financial product you own? Asset Accumulation Are your assets growing in the most tax-advantageous way? Are you able to access your assets if the need arises (liquidity)? With or without tax consequences? Asset Distribution Are you aware of tax and other financial implications at the time assets will be received? Asset Protection Are all your assets protected against the uncertainties of life so that you and your loved ones will not be put in financial jeopardy? Understanding Tax Implications and Advantages Your financial professional will help make sure you have answers to all of these questions as part of the review process. Part of the critical information you ll receive is how taxes can impact your assets at different points in your life.

4 It is common, for example, for more attention to be paid to the impact of taxes during the asset accumulation phase and less attention to when they are distributed or are withdrawn for any reason. But it is just as important to understand tax ramifications during both the accumulation and distribution phases. It may help to understand that no matter what financial products you own, they can be placed into one of three overall bundles or categories for tax purposes: Pre-Tax (Generally retirement plans with deferred tax implications) Tax-Managed (Tax-Deferred/or Long Term Capital Gains treatment) Protection (Such as tax-free death benefits from a life insurance policy 1 ) Asset Allocation and Accumulation Tax Considerations TOTAL ASSETS PRE-TAX BUNDLE 401(k) Pension SEP IRA TAX-MANAGED BUNDLE Tax-Managed Mutual Funds Variable Annuities Fixed Annuities PROTECTION BUNDLE Variable Life Universal Life Whole Life Term Life It is important to understand the tax implications and advantages of any of these or other financial products you own. And to feel secure that all your products are synchronized effectively for you. 1 Death benefits are generally received income tax-free pursuant to IRC 101(a).

5 Opportunities to Help Meet Multiple Financial Goals You may find that once you have met with a financial professional and better understand tax considerations and how well you are meeting asset allocation, accumulation and protection goals, you may wish to make changes to your financial strategy. For example, you might want to consider opportunities to help maximize your tax advantages and meet some of your accumulation and protection goals at the same time. Protection Bundle RETIREMENT EDUCATION MAJOR PURCHASE Variable Life Universal Life Whole Life Term Life One way to do that is to take advantage of life insurance products like variable life insurance and universal life insurance. Of course, the most important reason to purchase life insurance is for the death benefit protection, but these products can also offer you several other benefits: Tax deferred growth of cash value Liquidity (loans and withdrawals can be made for emergencies or specific needs 2 ) Investment choices to help ensure you meet your accumulation goals and employ an asset allocation strategy (available with variable life insurance) Tax-free distribution of assets (death benefits are tax-free 1 ) Protection against financial loss Tax-free transfers between investment choices (available with variable life insurance)

6 Talk to a Financial Professional from Prudential Today It is important that you speak with a knowledgeable, licensed financial professional about what products best suit your needs and life situation now and in the future. You ll get the critical information you need to help you feel confident that your financial strategy is on course to help your realize your dreams for today and tomorrow. Our seasoned financial professionals are committed to providing you with expertise, objectivity and integrity and seek to become your trusted resource and ally in helping you achieve your financial goals. 2 Loans and withdrawals reduce the death benefit and policy values, and may have tax consequences. The diagrams in this material are merely meant to list some of the financial and insurance vehicles that some people purchase, and do not represent a particular product nor guarantee or predict the performance of any products. Insurance issued by The Prudential Insurance Company of America, 751 Broad Street, Newark, NJ 07102, and its affiliates. Securities offered through Pruco Securities Corporation (member SIPC) at the same address. Both are Prudential Financial companies and each is responsible for its own financial condition and contractural obligations. Prudential does not provide tax advice, which should be obtained from your legal or tax advisor. Life insurance policies contain exclusions, limitations, reductions of benefits, and terms for keeping them in force. Your licensed financial professional can provide you with costs and complete details. IFS-A Ed. 5/2003