Once again, I thank you for the work you have done to explain this How can you withdrawal money from the account without reducing the death benefit? Excellent points on your presentation. The bonuses are only credited if you dont take withdrawals, so by immediately taking withdrawals you skip out on those benefits. Without analyzing your annuity, I cant say for certain, but your current annuity may offer better terms than the Jackson Perspective II. If you were to calculate taking out the same amount out of the portfolio as you did the annuity, the annuity would be better off. Additionally, the variable annuity does not protect the surrender value in the same manner that it protects the protected income balance (guaranteed benefit balance). As with all annuities, they work very well doing some aspects and poorly at other aspects. The story that salespeople tell about these lifetime income riders is that they offer an investor a minimum income for life even if the investments take a dive. 2). The amount of income that these benefits may provide can vary depending on the age when income is taken, and how many lives are covered when the benefit is elected. Jackson National Perspective Advisory II with lifeguard freedom accelerator riderAnnuity is meant to be an independent review at the request of readers, in addition, so they could see my perspective as a Certified Financial PlannerCFP,Designee whenbreaking down the positives and negatives of this particular model annuity. Many active mutual funds have been shown to underperform the index. Jacksonissues other annuities with similar features, benefits, limitations, and charges. That was informative. If you just plan to invest it in another annuity, then the best course of action may be to stay put because most annuities will have similar features, regardless of how different they look. At age, 65 I will be able to withdraw 5%. to invest but need an income from it of at least $500. I finally got around to watching the Video and it helped a little to demistify this Lifeguard Freedom 6 DB. Using compound interest the internal rate of return for the 200% step up after 12 years is 5.95%. Here are the expenses for the various income rider options: For the purpose of this review, I chose the LifeGuard Freedom Flex with 7% Bonus and Annual Step-Ups optional income upgrade, which has 1.50% in additional fees. I would need death benefits to leave money to my disabled son. The combined M&E&A of 1.25 percent is roughly in line with Jacksons direct competitors. Thanks for the info. 4). Guarantees are backed by the claims-paying ability of Jackson National Life Insurance Company or Jackson National Life Insurance Company of New York and do not apply to the principal amount or investment performance of a variable annuitys separate account or its underlying investments. Thanks. Any losses in the account must be made up before I can earn any fees and each year I do not earn performance fees until the return on the account exceeds 6% over the previous high water mark in the account. Same question here. Hope that answers your second question. An investment-only fee-based product that provides increased growth potential through diversified investment options, with the added benefit of tax-deferral. Clients should rely on their own independent advisors as to any tax, accounting, or legal statements made herein. Adding life insurance into the return analysis here would be akin to asking what the return of a 60/40 portfolio would be if you bought a whole life policy. The point of the annuity review is to educate people about the annuity so that they have a better idea about how it performs through time before they purchase it. I am assuming the former, due to your most aggressive possible investment choice. Markets dont really proceed linearly, they are up 40%, 20%, 5%, then down 50%, then up 60%. The Jackson National Perspective II Variable Annuity has a 1.30% fee just for owning it. I hope this clarifies the issue a bit. I am now age 73, Ive held this since age 68, and I consider it a unique product and a great deal for someone in my situation. No restrictions, no forced models and no forced re-allocations. This 5% Guaranteed on the market can sound very appealing but do not be sold so quickly. I am 62 and want to retire. The second and fourth quarters can be found in the Funds semi-annual and annual report respectively, using the links provided on this page or at connect.rightprospectus.com/Jackson. Youll need a comprehensive retirement income analysis that factors inflation, taxes, and your investment positioning to see if the annuity adds value to your retirement. Annuities are distributed by Jackson National Life Distributors LLC, memberFINRA. This should help increase the protected income base at a higher rate than a more conservative portfolio. And exactly what you can expect, so you can see deeper into an overly simplified sales pitch. A standard variable annuity (VA) allows investors to invest in subaccounts, which are like mutual funds, within the VA. Investors take on the risks of the market and usuallyhave some sort of death benefit associated with the annuity for their heirs. Risk tolerance and knowing your client are important within a complete financial plan, however, looking at one microcosm of it (the annuity) and extrapolating that to be the entirety of the investors portfolio is fallacious thinking. jackson national perspective ii performance jackson national perspective ii performance. What about qualified assets that cant be accessed prior to 591/2 without the 10% early withdrawal period? Thanks for your insight, It has been very helpful. No other annuity have total death benefits restored. By combining the responsiveness and personal attention of a family business with the resources and strength of a large corporation,theyare able to provide a unique experience to customers and partners. Financial professionals who are approved to. The Jackson National Perspective II annuity has the following features. 1929 should actually show the benefits of using the annuity versus the stock portfolio as the annuity is built to guarantee income should the annuity plunge in value. Most people looking at these annuities are around retirement age. I am thinking about purchasing this annuity soon with a quarterly step-up. Am I correct in thinking that at retirement age, there are no tax deferred options to roll the money into, and that capital gains taxes would make this idea prohibitive? When the 100% stock portfolio goes to $0 how much can the investor then withdraw each year? I am not sure how to get income from my money for the next almost 4 years and also cover healthcare. What you see in the video is the running calculation of the spreadsheet thats essentially asking if the maximum value of the income base should be bumped up to a higher maximum value. My question is this: Which methodology would be the most beneficial way of getting out of the Annuity, if any? Variable annuities are distributed by Jackson National Life Distributors LLC, member FINRA. Gordon Jackson (Gordon Cameron Jackson) was born on 19 December, 1923 in Glasgow, Scotland, UK, is an Actor, Soundtrack. I am also wondering if it rises to the level of a violation of his fiduciary responsibility. Have you done a similar analysis for AIG Polaris Income Plus daily flex? Now I dont think these advisors and salespeople are bad people for not explaining these annuities like I did for you in the video. The first and third quarters holdings of each fiscal year are filed with the SEC on Form N-PORT. Ticker Tape by TradingView. There are two regulatory bodies, the SEC and FINRA. The Funds file a complete schedule of portfolio holdings with the SEC for each quarter. In good years there would be modest growth in the income base and death benefit. This is not specific advice. The initial distribution rate on the annuity was higher because at the time it was using the higher income base (which benefits from the bonuses) instead of the account value. This question is almost too embarrassing to ask, but the case is that a financial adviser persuaded my 72 year old mother to take out a home equity loan of $300,000 and to purchase this Perspective Annuity with it. These contracts have limitations and restrictions. In other words, at about age 93 I will have withdrawn almost my entire contribution amount, but instead of taking that last withdrawal, I can ask Jackson to give me all my contributions back, thank you very much. Any short term investments within the annuity would be subject to the same market volatility as an investment made outside of the annuity. Just realize that on average the returns on these arent going to be great, so if he purchases it knowing what to expect and combines his annuity with investments outside of it to keep up with inflation, hell at least better protect his purchasing power. But after watching the video, I am now having second thoughts. Any comments would be greatly appreciated. This means John only earned 29% from his income rider in 25 years, so he only gained interest the first 5 years of the deferred contract, the rest of the 20 years John actually was paying fees to the insurance company and at the same time withdrawing his own money which is no better than if he has had that money under his mattress for those last 20 years. Before investing, investors should carefully consider the investment objectives, risks, charges, and expenses of the variable annuity and its underlying investment options. An annuity with an income rider is not an accumulation tools. If one was to take this approach, there would usually be about a 1.7% fee, making the Portfolio return lag. Yes, the death benefit starts decreasing once you start the income stream, its reduced by the withdrawals. of 242. I also have question myself. Thats how its designed so that it can protect client income. Very important to people that are entering retirement age now or soon and dont have time to make up for loses if the market tanks again. Rather, the main feature that caught my eye is the elimination of any asset allocation or risk restrictions in their sub-accounts. They roll it into an IRA, and have additional liquidity to bridge them until then, using after tax money. This can cause the incomes purchasing power to erode against inflation through time. I wanted to stress test the annuity against various time periods and economic conditions. 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