First, if you’re not familiar with insurance indexing. Insurance indexing is a strategy that links the interest credited in a financial account or insurance contract to an index, like the S&P 500®.
Typically, indexed products work like this: there is a floor of zero, meaning the worst you can do in a given measurement period is 0% interest. (In 2008, when the market dropped 37%, indexed accounts were not credited any interest, but unlike funds in the stock market, they didn’t lose any value, either.)
At our firm, we love using indexed insurance contracts, because they protect our clients from market crashes while still letting them participate in market rises.
I also wondered: how would the Index Contract do in the worst market our country has faced in modern history: The Great Depression?
3. 1. Never Let Your Money Stop Compounding
2. Never Pay More in Tax than you have to
3. Never Lose Money
4. Never Allow an illness to Wipe you out
Freedom Equity Group
CRUSADE…
For Training Purposes ONLY
4. Warren Buffett’s
Two Rules you Must Follow
Rule #1- Don’t Lose Money
#2- Refer to Rule #1
How To Win the Money GameFor Training Purposes ONLY
5. DON’T LOSE MONEY
1) Market Risk
The Magic of Compound Interest is
NEGATED by the effect of even
Minor Losses.2) Fees
3)Taxes
Risk
Losses are MORE DEVASTATING than
most realize.
For Training Purposes ONLY
6. THE LAST 10 YEARS
Annual change in S&P 500 Index with Cap and Floor
Annual change in S&P 500 Index
69.8%
Yield
16.8%
Yield
53%
Difference
0.00% 0.00%
14.00%
13.62%
12.64%
14.00%
8.99%
3.00%
3.55% 0.00%
-13.04% -23.37% 26.38%
8.99% 3.00%
13.62%
3.55%
-38.47
23.49%
12.64%
Past performance is no guarantee of future performance
Investment expenses and taxes were not included.
0.00% Floor
Downside
Protection
14.00% Cap
Growth
Potential
For Training Purposes ONLY
8. Average
rate of
Return 5.04% $167,477 VS
7.67% $317,756
A DIFFERENCE OF: $150,279
FEES
Pay:
Gain or Lose
3%/yr
$51,598
VS
IUL COST
Receive:
Living Benefits.
Death Benefits
TAXES 20%
$23,176
VS TAXES TAX FREE
SPENDABLE $92,703
VS SPENDABLE $317,756
How much can you safely withdraw in retirement without
running out of money?
“Vanguard suggests withdrawing between 3%-5% per year.”
4% of $92,703=
$3,600/year
VS 15% of $317,756=
$46,000/yearFor Training Purposes ONLY
21. A Better Way to Save
Traditional Better Method
Bank 1% to 2.5%
Real Estate
Stocks
Gold
Taxable or Tax Free
Potential Downward Spiral
Fixed 4.5%
Real Estate
No Cap
Less 1.5% fee
+.25%
S&P Index
13.5% Cap +.25%
Gold
14% Cap +.25%
Tax Free & Living Benefits
Question… Where would you rather be? For Training Purposes ONLY
22. The Power of Indexing
*417% mor
* After fees and taxes (assumed 30% tax bracket and 2% management fees)
*278% more
*358% more *448% mor
For Training Purposes ONLY
25. For Training Purposes ONLY
• All information contained in this presentation is intended for general
education and information use only and is not intended as a solicitation
for buying or selling life insurance products.
The material in this presentation is not intended to give advice on tax
planning, investments, real estate, accounting, estate planning, or
financial planning but rather to provide education and information about
a possible business opportunity with Freedom Equity Group.
As with any business opportunity the FEG Business Opportunity may
take time, effort and money which may or may not provide any financial
returns.
Assumptions are made in several hypothetical examples to help explain
concepts and are for illustrative purposes only and should in no way be
construed as any type of guarantee. Past performance is also not a
guarantee of future results
Benefits vary by Insurance Company, be sure to check with your
agent as to specific riders and benefits availability in your state
FEG does not provide tax or legal advice, please consult your advisors