Withdrawals with SunAmerica Income Plus 6% SM

Transcription

1 Guaratee cliets Withdrawals with SuAmerica Icome Plus 6% SM More Now More Later More Flexibility Growth with SuAmerica Icome Builder 8% SM For fiacial professioal use oly. Not for distributio to the public.

2 Cliets eed More Icome Now, More Icome Later ad More Icome Flexibility Today s Ivestors Face Critical Icome Challeges Over the past few years, difficult market coditios ad a challegig ecoomy have come together to form a perfect storm for ivestors approachig retiremet or already retired. May cliets: Are ow approachig retiremet with smaller retiremet portfolios ad eed a recovery strategy Need to take immediate icome from dimiished retiremet assets Require a icome stream to start at a earlier age due to a job loss or icome reductio However, most fiacial products are ot well suited to address these critical icome challeges. The guaratees associated with these protectio features are backed by the fiacial stregth ad claims payig ability of the issuig isurace compay. Optioal protectio features are available at the time of purchase. To realize the beefits of a icome protectio feature, cliets must take withdrawals withi the parameters of the feature. Depedig upo the performace of the ivestmet, cliets may ever eed to rely o the protectio provided by these optioal isurace features. Ivestmet requiremets, age restrictios ad other limitatios apply to these features. Not all features are available i all states. Please see a prospectus or cliet kit for complete details. 2 For fiacial professioal use oly. Not for distributio to the public.

3 SuAmerica Delivers a Icome Advatage We desiged our ew guarateed miimum withdrawal beefits to provide maximum icome for ivestors i today s challegig climate. Now you ca offer cliets: Higher guaratees to help cliets icome recover from uprecedeted market declies Higher withdrawal rates at a earlier age Guarateed lifetime icome so cliets eedig more icome sooer do t sacrifice their safety et Ivestmet cotrol so that you ad your cliets ca decide how to allocate assets Higher icome potetial with a RMD ad 72(t) Advatage Itroducig the ew Icome Plus 6% ad Icome Builder 8% livig beefit optios i select Polaris Variable Auities. Auities are desiged for log-term retiremet ivestig. Withdrawals of taxable amouts are subject to ordiary icome tax ad, if take prior to age 59½, a 10% federal tax pealty may apply. Early withdrawals may be subject to withdrawal charges. A ivestmet i a variable auity ivolves ivestmet risk, icludig possible loss of pricipal. The cotract, whe redeemed, may be worth more or less tha the total amout ivested. 3

4 SuAmerica Icome Plus More Icome Now & Icome Plus 6% Key Advatages: 6% withdrawal rate, as early as age 45, for more icome ow 6% icome credit for 12 years for more icome later Potetial to keep the differece with a partial icome credit eve i years withdrawals are take 1 Doublig of icome floor after 12 years (200% of first-year premiums) if o withdrawals are take, with a 6% withdrawal rate available at that time Opportuity for market step-ups ad stacked icome credits Opportuity for aual market step-ups as log as cash value remais Available to issue ages 45 to 80 Cliet Profile Curret retirees who eed to geerate greater icome ow or later while maitaiig lifetime icome protectio. Cliets lookig for a RMD Advatage with guarateed risig icome or the ability to cotiue to grow their future icome potetial while takig distributios. Cliets affected by lay-off, job displacemet or pay reductio who eed to take early icome uder 72(t) or 72(q). Optio Maximum Aual Withdrawal Amout (Percetage of Icome Base) Protected Icome Paymet Percetage* Sigle Life 6.0% 4.0% (3% if withdrawals start before 65) Joit Life 5.5% 4.0% (3% if withdrawals start before 65) * I the evet the cotract value declies to zero, cliets will cotiue to receive guarateed lifetime icome for as log as they live. 4 For fiacial professioal use oly. Not for distributio to the public.

5 6% SM offers More Icome Flexibility With a RMD ad 72(t) Advatage! Icome Plus 6% Provides a Icome Advatage for More Tha 40 Years! (Hypothetical sceario based o the assumptios below) Age Icome Plus 6% 5 for Life Feature SuAmerica Cumulative W/D Amout Cumulative W/D Amout Cumulative Icome Advatage Dollar Amout Percetage 65 $6,000 $5,000 $1,000 20% 70 $36,000 $30,000 $6,000 20% 75 $66,000 $55,000 $11,000 20% 80 $96,000 $80,000 $16,000 20% 85 $126,000 $105,000 $21,000 20% 88* $144,000 $120,000 $24,000 20% 90 $152,000 $130,000 $22,000 17% 95 $172,000 $155,000 $17,000 11% 112 $240,000 $240,000 /a *Protected Icome Paymet of 4% begis ad cotiues for life Assumptios of Hypothetical Sceario: Max. Aual Withdrawal: 6% / 4% 3% growth rate et of fees vs. 5% for life (sigle life optio) Withdrawals start immediately Age: 65 Ivestmet: $100,000 (o subsequet ivestmets) No icome credits for either feature due to immediate maximum withdrawals Icome Plus 6% provides more icome at earlier ages ad greater lifetime icome With Icome Plus 6%, cliets ca receive more icome early i retiremet whe spedig is ofte highest. I the hypothetical sceario above comparig Icome Plus 6% to a 5% for life withdrawal rate, cliets would receive 20% more icome from Icome Plus 6% for most of their retiremet. The higher aual withdrawal amouts cotiue through age 88 as illustrated by the cumulative withdrawal amout i this example, ad are oly reduced if their cotract value drops to zero. I this sceario, the cumulative icome from Icome Plus 6% would remai higher tha the 5 for life feature util age 112! Note, this is a hypothetical example to illustrate how Icome Plus 6% differs from a 5 for life feature that guaratees withdrawals of 5% of Icome Base for life. This example assumes all other variables are the same. Products may have additioal material differeces i isurace charges icludig M&E fees, admiistrative fees, ad withdrawal charges as well as the fees associated with the uderlyig variable portfolios. Icome protectio features may also differ materially i ways other tha illustrated above. This example does ot reflect the performace of ay specific ivestmet. Refer to the back cover for more iformatio about Icome Plus 6%. 5

6 SuAmerica Icome Builder More Icome Later & Icome Builder 8% Key Advatages: 8% icome credit for 12 years for more icome later No icome credit i years withdrawals are take 5.5% withdrawal rate, as early as age 45 Icome credit resumes i years withdrawals are ot take durig first 12 years so cliets ca start ad stop icome as eeded Doublig of icome floor after 12 years (200% of first-year premiums) if o withdrawals are take, with a 5.5% withdrawal rate available at that time Opportuity for market step-ups ad stacked icome credits Opportuity for aual market step-ups as log as cash value remais Available to issue ages 45 to 80 Cliet Profile Cliets who ca wait to take icome ad are lookig for maximum icome potetial i retiremet. Greater icome growth potetial with a 8% icome credit or market step-up i years withdrawals are ot take A 5.5% withdrawal rate (sigle life) for greater access to their icome base whe withdrawals begi Optio Maximum Aual Withdrawal Amout (Percetage of Icome Base) Protected Icome Paymet Percetage* Sigle Life 5.5% 4.0% (3% if withdrawals start before 65) Joit Life 5.0% 4.0% (3% if withdrawals start before 65) * I the evet the cotract value declies to zero, cliets will cotiue to receive guarateed lifetime icome for as log as they live. 6 For fiacial professioal use oly. Not for distributio to the public.

7 8% SM offers More Icome Flexibility Icome Builder 8% Provides a Icome Advatage for Nearly 60 Years! (Hypothetical sceario based o the assumptios below) Age Icome Plus 8% Cumulative W/D Amout 6% Icome Credit Feature Cumulative W/D Amout 65 $9,900 $8, $59,400 $48, $108,900 $88, $158,400 $128,000 82* $178,200 $144, $199,800 $168, $221,400 $192, $235,800 $208,000 SuAmerica Cumulative Icome Advatage Dollar Amout Percetage $1,900 24% 95 $271,800 $248,000 $23,800 10% 124 $480,600 $480,000 /a *Protected Icome Paymet of 4% begis ad cotiues for life $11,400 24% $20,900 24% $30,400 24% $34,200 24% $31,800 19% $29,400 15% $27,800 13% Assumptios of Hypothetical Sceario: SuAmerica Icome Credit: 8% Other Icome Credit: 6% Max. Aual Withdrawal: 5.5% / 4% vs. 5% for life (sigle life optio) Age: 55 at issue Withdrawals delayed 10 years ad start at 65 Ivestmet: $100,000 (o subsequet ivestmets) 3% growth rate et of fees Icome Builder 8% provides cliets with more retiremet icome later With Icome Builder 8%, cliets have the potetial to build more icome for retiremet with a 8% icome credit for up to 12 years i years withdrawals are ot take. Ad, whe cliets are ready to take icome, they have greater access to their moey with a higher withdrawal rate. I the hypothetical sceario above, withdrawals begi 10 years after issue i both features, ad the cumulative icome from Icome Builder 8% is already 24% higher through age 82. This icome advatage is oly reduced if their cotract value drops to zero. I this case, the cumulative icome from Icome Builder 8% would still remai higher through age 124! Note, this is a hypothetical example to illustrate how Icome Builder 8% differs from a feature with a 6% icome credit ad guaratees withdrawals of 5% of Icome Base for life. This example assumes all other variables are the same. Products may have additioal material differeces i isurace charges icludig M&E fees, admiistrative fees, ad withdrawal charges as well as the fees associated with the uderlyig variable portfolios. Icome protectio features may also differ materially i ways other tha illustrated above. This example does ot reflect the performace of ay specific ivestmet. Refer to the back cover for more iformatio about Icome Builder 8%. 7

8 Protectio-Based Fee: Greater Icome Protectio ad Value for Ivestors SuAmerica is able to offer greater icome protectio to your cliets through the iovatio of protectio-based pricig. Historically, the fee for ay livig beefit has geerally bee set to cover the ogoig cost of hedgig durig the etire time a cliet ows the cotract. However, hedgig costs cotiuously chage as market volatility moves the cost of the hedges up or dow. With our protectio-based pricig, the cliet shares i the cost of hedgig whe volatility goes up, but we pass the savigs o to the cliet by lowerig their fee whe the cost of hedgig goes dow. The fee rate is guarateed for the first year ad the ca go up or dow quarterly based o a pre-determied, o-discretioary formula. SuAmerica s iovative ad trasparet pricig model is the same for both Icome Plus 6% ad Icome Builder 8%. Optio Iitial Fee Miimum Fee Maximum Fee Maximum Aualized Fee Rate Decrease/ Icrease Each Quarter Sigle Life 1.10% 0.60% 2.20% 0.25% Joit Life 1.35% 0.60% 2.70% 0.25% Fee rate guarateed for the first year After the first year, the fee rate will be adjusted quarterly by a rate of 5 basis poits aualized for every 1% poit move i the VIX volatility idex as reported by the Chicago Board Optios Exchage The fee rate ca decrease or icrease ad is subject to a quarterly cap o adjustmets ad a overall fee rate cap ad floor Quarterly fee rate caot decrease or icrease by more tha 6.25 basis poits from the prior quarter (25 basis poits aualized rate) 8 For fiacial professioal use oly. Not for distributio to the public.

9 20-Year Fee Illustratio Sigle Life PROTECTION-BASED QUARTERLY FEE 1,527 1,561 VIX VALUE VIX Average VIX Quarterly Fee S&P 500 Idex.75%.50%.275% 20.0 Iitial Quarterly Fee Rate 367 I periods of low volatility, the quarterly fee rate would have bee reduced, reachig a low of 0.15% Whe the VIX peaked at 83, the fee rate reached a high of 0.41% Average VIX As VIX dropped, fee approached iitial fee rate The illustratio above demostrates how SuAmerica s protectio-based pricig would have worked over the last two decades. As the chart shows, the VIX geerally has a iverse relatioship to the equity market expressed by greater volatility i bear markets ad lower volatility i bull markets. By havig the fee move i step with the VIX, cliets pay more for protectio whe they eed it, but pay a lower fee rate whe volatility declies. Ad cliets are always protected from dramatic temporary swigs i volatility by the quarterly cap o the fee rate adjustmet. Eve durig the period at the ed of 2008 whe the market was experiecig substatial turmoil ad the VIX value topped 80, the cap elemet of the fee structure reduced the impact of the large, temporary swig i the VIX idex. Additioally, the fee rate would have retured to a lower level withi two quarters. 9

10 Cliets eed More Icome Now, More Icome Later ad More Icome Flexibility Ivest Up to 70% i Equities ad You ad Your Cliets Stay i Cotrol With Icome Plus 6% ad Icome Builder 8%, you ad your cliets ca ivest up to 70% i equities ad retai ivestmet cotrol at all times. Your cliets have a choice of flexible ivestmet optios with four differet ways to ivest: 1 Choose from three of the Polaris Portfolio Allocator models or split the allocatio evely amog a Portfolio Allocator model ad the correspodig Maaged Allocatio Portfolio (fud-of-fuds). 2 Build a customized portfolio with at least 20% ivested amog the cash, bods ad fixed group ad up to 70% amog the equity group, with a maximum of 10% i the most aggressive equity group. 3 Choose oe (or a combiatio) of eight asset allocatio or balaced portfolios 4 Choose a cash maagemet portfolio or fixed accout 70% equities 10% Secure Value Accout 30% fixed icome 10% of all premiums (oe-third of the required fixed icome allocatio) are allocated to SuAmerica s ew Secure Value Accout. This fixed accout provides aual iterest creditig ad is ot subject to rebalacig. As a result, the Secure Value Accout provides stability durig periods of declie i the value of other ivestmets i your cliets portfolios. 10 For fiacial professioal use oly. Not for distributio to the public.

11 Polaris: The Total Retiremet Package Performace for the growth potetial cliets eed. Respected moey maagers, multiple ivestmet optios, ad professioally-desiged asset allocatio strategies Protectio for the sese of security cliets wat. A choice of optioal icome protectio features ad ehaced death beefit optios Stregth for edurig stability. SuAmerica, The Retiremet Specialist, has the experiece ad resources to support ivestor eeds today ad i the years ahead Guaratees are backed by the fiacial stregth ad claims-payig ability of the issuig isurace compay. SuAmerica The Retiremet Specialist We Uderstad Retiremet. We Deliver Solutios. For more iformatio, cotact your SuAmerica wholesaler or call us today at

12 1 As log as the amout take is less tha the Maximum Aual Withdrawal Amout, cliets receive a icome credit for the differece betwee their withdrawal amout ad 6% of their Icome Base. If eligible ad the full 6% is withdraw i a give year, a icome credit will ot be available o the ext cotract aiversary as the 6% icome credit percetage is reduced by the percetage of the Icome Base withdraw. Additioal iformatio about Icome Plus 6% ad Icome Builder 8%: Icome Base: The amout o which guarateed withdrawals are based. It is iitially equal to the first eligible purchase paymet. O each cotract aiversary, the Icome Base is set to equal the greater of (a) the aiversary value, if greater tha all previous aiversary values, or (b) the Icome Base plus the icome credit amout (if eligible) durig the icome credit period. The Icome Base is automatically evaluated o cotract aiversaries while the cotract value is greater tha zero, provided the cliet has ot reached the Latest Auity Date (later of 95th birthday or 10th cotract aiversary). O the 12th cotract aiversary, the Icome Base may be icreased to the Miimum Icome Base (200% of eligible first-year purchase paymets) if o withdrawals have bee take from the cotract. The Icome Base will be icreased each time a eligible purchase paymet is made ad adjusted for excess withdrawals. Icome Credit: The amout that may be added to the Icome Base durig the cotract s first 12 years, calculated as a percetage of the Icome Credit Base. Icome Credit Base: A compoet of the feature that is used to calculate the icome credit. Iitially, the Icome Credit Base is equal to the first eligible purchase paymet. If the Icome Base steps up to the highest aiversary value o a cotract aiversary, the Icome Credit Base will also step up to this amout. Please ote, the Icome Credit Base is ot icreased if the Icome Base steps up due to the additio of the icome credit. The Icome Credit Base will be icreased each time a eligible purchase paymet is made ad adjusted for excess withdrawals. Joit Life Optio: I the evet of a death, spousal cotiuatio must be elected to provide guarateed icome for the lifetime of the remaiig spouse. The fee for the Joit Life optio will cotiue to be charged. The Joit Life optio will automatically be cacelled if a death beefit is paid ad the cotract is ot cotiued by the spouse, or if the survivig origial spouse dies. The Sigle Life optio will automatically be cacelled if a death beefit is paid or if the ower (or older ower if joitly owed) dies. Excess Withdrawals: If a withdrawal is take that exceeds the maximum aual withdrawal amout (kow as a excess withdrawal ) ad the withdrawal reduces the cotract value to zero, the feature will termiate ad cliets will o loger be eligible to take withdrawals or receive lifetime icome paymets. These features may ot be appropriate for use with cotributory IRAs (IRA, Roth ad SEP) or tax-qualified plas (401 ad 457) if cliets pla to make ogoig cotributios. If your cliets pla to take Required Miimum Distributios (RMDs) from their cotract, please see the prospectus for more iformatio. Cliets should cosult with a tax advisor cocerig their particular circumstaces. Icome Plus 6% ad Icome Builder 8% may be cacelled o the 5th cotract aiversary, or ay cotract quarter after that. If a ivestor decides ot to take withdrawals, he or she will ot receive the beefits of these features. Variable auities are sold by prospectus oly. The prospectus cotais the ivestmet objectives, risks, fees, charges, expeses ad other iformatio regardig the cotract ad uderlyig fuds, which should be cosidered carefully before ivestig. A prospectus may be obtaied by callig Cliets should read the prospectus carefully before ivestig. S&P ad Stadard & Poor s are trademarks of Stadard & Poor s ad have bee licesed for use by SuAmerica Auity ad Life Assurace Compay ad First SuAmerica Life Isurace Compay. CBOE Volatility Idex ad VIX are trademarks of the Chicago Board Optios Exchage, Icorporated (CBOE) ad have bee licesed for use by Stadard & Poor s. Polaris Variable Auities are ot sposored, edorsed, sold or promoted by Stadard & Poor s or the CBOE ad either Stadard & Poor s or the CBOE make ay represetatio regardig the advisability of ivestig i a Polaris Variable Auity. Variable auities are issued by SuAmerica Auity ad Life Assurace Compay, except i New York where they are issued by First SuAmerica Life Isurace Compay, New York, NY. The purchase of a variable auity is ot required for, ad is ot a term of the provisio of ay bakig service or activity. Distributed by SuAmerica Capital Services, Ic. Not FDIC or NCUA/NCUSIF Isured May Lose Value No Bak or Credit Uio Guaratee Not a Deposit Not Isured by ay Federal Govermet Agecy For fiacial professioal use oly. Not for distributio to the public. M4960BRO (01/10) SBA091381