Protect your retirement income

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(No Transcript)
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Protect your retirement income

• Few things matter more than your retirement
  assets.
• Protect them against the threat of long-term
  care.

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Managing assets in retirement
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What if the balance is destroyed?
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Agenda

• Understanding the facts of long-term care
• How would you pay for it?
• How MoneyGuard Reserve can offer one simple
  solution

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Chances are, youll need care

• Chance of needing long-term care after age 65

Source Americans Fail to Act on Long-Term Care
Protection, The American Society on Aging, May
2003.
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What does long-term care cost?

• National average costs of long-term care

Who would pay for it if you needed long-term
care?
Source Congressional Budget Office Testimony,
The Cost and Financing of Long-Term Care
Services before the Subcommittee on Health
Committee on Energy and Commerce, U.S. House of
Representatives, April 27, 2005.
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What you cant rely on

• Medicare acute care only
• Medicaid must spend down assets

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How to cover long-term care costs

• Its up to you.

• You have three choices

• Pay

• Self-insure

• Reposition

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Traditional long-term care insurance

• Advantages

• Guaranteed benefits

• Most policies cover all levels of care

• Disadvantages

• Premiums you pay may be expensive

• Recurring premium payments

• Premiums may increase

• You typically dont get your money back

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Self-insuring

• Advantages

• You maintain control

• You dont pay for coverage you may never use

• Disadvantages

• You must set aside significant liquid assets

• You may deplete assets too quickly

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How to cover long-term care costs
If youre not doing anything, youre
self-insuring.
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Now you can reposition with MoneyGuard Reserve

• MoneyGuard Reserve, a universal life insurance
  policy, is a smart way to cover long-term care
  costs. It makes sense for today and tomorrow.

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One simple solution
Cash reserves
Investments
MoneyGuard Reserve
Life insurance
House
While the actual proportions in this chart will
differ based on a specific investors needs, it
does show the different types of assets in a
typical retirement-oriented portfolio.
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If you need long-term care
Cash reserves
Up to 500 with MoneyGuard Reserve
Investments
MoneyGuard Reserve
Life insurance
House
Long-term care reimbursements are income tax-free
under IRC Section 104(a)(3).
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If you need it back
Cash reserves
Up to 500 with MoneyGuard Reserve
Investments
MoneyGuard Reserve
premium is returned
Life insurance
Take it back its in your reserve.
House
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If you never need long-term care
Cash reserves
Investments
MoneyGuard Reserve
death benefit
Life insurance
Unused portion goes to your beneficiary income
tax-free.
House
Beneficiaries receive an income tax-free death
benefit under IRC Section 101(a)(1).
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Long-term care coverage

• You need the full benefits
• of MoneyGuard Reserve

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Reimbursement for long-term careup to 499,218
income tax-free
This example is based on a 65-year-old,
nonsmoking female in good health with a 100,000
single premium for a policy with the two-year
Convalescent Care Benefits Rider (CCBR), the
four-year Extension of Benefits Rider (EOBR), and
the Return of Premium Rider (ROPR). Benefit
amounts vary by age, gender (except in Montana,
where male premiums apply), and health status.
Benefits are adjusted for loans and withdrawals
and may have tax implications. Long-term care
reimbursements are income tax-free under IRC
Section 104(a)(3).
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Money back guarantee
You change your mind
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This example is based on a 65-year-old,
nonsmoking female in good health with a 100,000
single premium for a policy with the two-year
Convalescent Care Benefits Rider (CCBR), the
four-year Extension of Benefits Rider (EOBR), and
the Return of Premium Rider (ROPR). Benefit
amounts vary by age, gender (except in Montana,
where male premiums apply), and health status.
Benefits are adjusted for loans and withdrawals.
A portion of the amount returned may have tax
implications.
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Income tax-free death benefit
3 possibilities
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You need the full benefits ofMoneyGuard
All three outcomes are guaranteed
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You changeyour mind
This example is based on a 65-year-old,
nonsmoking female in good health with a 100,000
single premium for a policy with the two-year
Convalescent Care Benefits Rider (CCBR), the
four-year Extension of Benefits Rider (EOBR), and
the Return of Premium Rider (ROPR). Benefit
amounts vary by age, gender (except in Montana,
where male premiums apply), and health status.
Beneficiaries receive death benefits income
tax-free under IRC Section 101(a)(1). Guarantees
are backed by the claims-paying ability of The
Lincoln National Life Insurance Company.
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Lets look at Nancy Arneau

• Good health, nonsmoker
• Decided againsttraditional long-termcare
  insurance
• Currently self-insuring
• Wants to protecther retirement income

Nancy Arneau Age 65
Hypothetical example only. Benefit amounts vary
by age, gender (except in Montana, where male
premiums apply), and health status.
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Repositioning assets
200,000Freed up for retirement
Additional long-term care benefit
300,000Set aside for long-term care costs
Up to
332,812
499,218
166,406
100,000Repositioned for MoneyGuard payment
Death benefit or long-term care benefit
Benefits are adjusted for loans and withdrawals
and may have tax implications. Long-term care
reimbursements are income tax-free under IRC
Section 104(a)(3). Beneficiaries receive death
benefits income tax-free under IRC Section
101(a)(1).
Hypothetical example only. Benefit amounts vary
by age, gender (except in Montana, where male
premiums apply), and health status.
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Three outcomes all guaranteed
You need the full benefits of MoneyGuard Reserve
You changeyour mind
You never needlong-term care

This example is based on a 65-year-old,
nonsmoking female in good health with a 100,000
single premium for a policy with the two-year
Convalescent Care Benefits Rider (CCBR), the
four-year Extension of Benefits Rider (EOBR), and
the Return of Premium Rider (ROPR). Benefit
amounts vary by age, gender (except in Montana,
where male premiums apply), and health status.
Benefits are adjusted for loans and withdrawals
and may have tax implications. Long-term care
reimbursements are income tax-free under IRC
Section 104(a)(3). Beneficiaries receive death
benefits income tax-free under IRC Section
101(a)(1).
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What you should know about MoneyGuard Reserve

• Covers qualified long-term care costs.
• Includes a money back guarantee.
• Helps you leave money to loved ones.
• Helps you maintain control of assets.
• Protects assets now and in the future.

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Which option fits your strategy?

• Government programs
• Traditional long-termcare insurance
• Self-insuring
• MoneyGuard Reserve

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The challenge of long-term care

• Do you have enough assets set aside for long-term
  care?
• Do you have access to assets?
• If you dont need long-term care, what happens
  to the assets?

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Retirement income security

• MoneyGuard Reserve helps you leverage dollars
  available for long-term care costs.
• MoneyGuard Reserve offers a money back
  guarantee.
• MoneyGuard Reserve offers efficient transfer to
  your heirs.

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Next steps

• Talk with your financial advisor or insurance
  agent.
• Be sure youre protecting your retirement income.

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Important disclosures

• MoneyGuard Reserve is a universal life insurance
  policy with a rider that accelerates the
  specified amount of death benefit to pay for
  covered long-term care expenses. An Extension of
  Benefits Rider (EOBR) is available to continue
  long-term care benefit payments after the entire
  specified amount of death benefit has been paid.
  The Return of Premium Rider (ROPR) is included at
  issue (single premium only). The cost for these
  riders will be deducted from the policy account
  value. Guarantees are backed by the claims-paying
  ability of the issuer and are subject to policy
  terms and conditions. This policy has exclusions
  and/or limitations. Two-year suicide and
  contestability provisions apply (one-year in some
  states).
• This material was prepared to support the
  promotion and marketing of a universal life
  insurance product. Lincoln Financial Group
  affiliates, their distributors, and their
  respective employees, representatives, and/or
  insurance agents do not provide tax, accounting,
  or legal advice. Any tax statements contained
  herein were not intended or written to be used,
  and cannot be used, for the purpose of avoiding
  U.S. federal, state, or local tax penalties.
  Please consult your own independent advisor as to
  any tax, accounting, or legal statements made
  herein.
• MoneyGuard Reserve is issued on policy form LN850
  (8/05), Return of Premium Rider on form LR850
  (8/05), Convalescent Care Benefits Rider on form
  LR851 (8/05), and Extension of Benefits Rider on
  form LR852 (8/05) and state variations by The
  Lincoln National Life Insurance Company, Fort
  Wayne, IN. Products and features are subject to
  state availability. Not for use in MA or NY.
• Lincoln Financial Group is the marketing name for
  Lincoln National Corporation and its affiliates.