Professional Documents
Culture Documents
For Business Owners
For Business Owners
For Business Owners
Business Owners
Today’s Agenda
Programs for:
Business Owners
What the Programs are:
Financed Planning for Business retirement
How the Programs work:
Overview of the Programs
Case Study:
Paul Smith
The Business Owners’ Challenge
Maturity
Expansion
Growth
Startup
Unfortunately…………
Selling the Business: The Reality
Retirement Health
The Answer
Programs:
The Rule of 72
How long does money take to double?
Divide 72 by the assumed rate, the result is $4M
the number of years until a sum doubles.
$2M
$1M
$500K
Note:
Hypothetical results for illustrative purposes only and not a representation of past
or future results.
Compressed Time Frame Concept
Accelerated Funding
Choice 1 - $ 16,667 per year X 30 years = $500,000
Choice 2 - $ 50,000 per year X 10 years = $500,000
Choice 3 - $500,000 only once X Today = $500,000
$16,667 $1,684,584
$50,000 $2,860,393
$500,000 $3,808,127
Today 30 Years
Note:
A hypothetical crediting rate of 7%. Represents approximations and should not be relied upon as tax or investment
advice. The performance of financial products fluctuate over time. The actual time to achieve any result cannot be
predicted with certainty.
Compounding with Real Estate
7%
average annual growth
over 20 years
Point A Point B
Annual $1,080,000
Crediting Needed to
8% Catch Up
14.12%
$1,000,000 Market Down Turn $993,660
- 8%
Keep in mind…
If you received the 5% as shown in this example on the $993,660, you would
have a total of $1,043,343. That is a $90,657 difference because of the
guaranteed floor.
How the
Programs Work:
An Overview
Program Overview
Step 1 Step 2 Step 3
Commercial Loan Transfer Method Asset Funding
Universal Life
and/or
Annuity
Products
Client Business
Client Business
•
The $600,000 is placed into an Equity Indexed Annuity, owned by
Paul Smith (assumed annual tax deferred earnings of 7%).
•
ABC Company makes interest payments of approximately
•
After 13 years, Paul’s annuity value will have grown to $1,445,907,
which gives Paul an income in the amount of $115,957 per year
for
25 years.
•
(This example assumes that the loan is repaid at retirement using assets that are not part of the program’s
Equivalent Yield – Paul Smith
Individual Level
The product is owned by the individual, not the
corporation. If the corporation is sued, this is not
its asset.
Product Level
This level depends on the state you sell in. State law
defines the level of protection regarding cash value
and policy attachment by creditors.
The Next Step
John A Weisenberg
Senior Finance Manager
240-462-8296
saw101@msn.com