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Sales Ideas & Marketing Concepts …. That Work !!! Robert G. Williams VP of Annuity Training. Today’s Agenda. How To Create Interest Which Crediting Method is Best. Index Annuity. How Does it Really Work? The Stairway to Financial Peace of Mind. Year 5. - PowerPoint PPT Presentation
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Sales Ideas & Marketing Concepts
…. That Work !!!
Robert G. WilliamsVP of Annuity Training
Today’s Agenda
•How To Create Interest•Which Crediting Method is Best
Index Annuity
• How Does it Really Work?• The Stairway to Financial Peace of
Mind
$$$$
Year 1Year 2
Year 3 Year 4
Year 5 Year 6
Annual Reset locks in the gain.
$100,000
Index Rises 10%
8% Cap
Index Account
$108,000
Index Falls 10%
Index Gains Locked IN
$108,000
Index Rises 10%
8% Cap
Index account
$116,640
Index Falls 10%
What happens
next year?
Hypothetical Annual Reset
Protection
Potentia
l
$
Index Annuity Hypothetical
Year
1234567
$124,978$121,338$121,338
$113,400
$108,000
Index Value
Surrender Fee May Apply
(3%)
(7%)
(5%)
(8%)
(6%) $132,477
Surrender Fee Will Apply
Min Guar %
$109,737$107,217
$104,755
$102,350
$112,315$114,955
(0%)
(0%) $132,477 $117,656
Index Annuity
Year Index Acc’t MGSV100%@2.35
%
Index Acc’tNo Market
Gains
1 (8%) $108,000 $102,350 $100,000
2 (5%) $113,400 $104,755 $100,000
3 (7%) $121,338 $107,217 $100,000
4 (0%) $121,338 $109,737 $100,000
5 (3%) $124,978 $112,315 $100,000
6 (6%) $132,477 $114,955 $100,000
7 (0%) $132,477 $117,656 $100,000
Sailing the Waters of theStock Market
Market Index
Financial Advisor
Poor Market Performance
Monthly AverageHow It Works
S&P 500 1,000
900 1000 1100 1200 1000 1200 1200 1100 1200 1200 1100 1000
13,200÷12
=1,100
-1,000
=100
÷ 1,000
=10%
Point to PointHow It Works
S&P 500 or Dow 30
April 1, xx =1,000
March 31, xx =1,100
1,100
-1,000
=100
÷ 1,000
=10%
Monthly AverageHow It Works
S&P 500 1,000
90010001100120010001200120011001200120011001000
13,200÷12
=1,100
-1,000
=100
÷ 1,000
=10%900
1300
Monthly AverageHow It Works
S&P 500
(Oct. 1, 2003)
1018.22
1059.02 1070.12 1108.48 1135.26 1155.97 1132.17 1117.49 1121.20 1128.94 1106.62 1105.91 1131.50
13,372.68
÷12
= 1114.39
- 1018.22
= 96.17
÷ 1018.22
= 9.44%
Annual Point to PointHow It Works
S&P 500
(Oct. 1, 2003)
1018.22
1059.02 1070.12 1108.48 1135.26 1155.97 1132.17 1117.49 1121.20 1128.94 1106.62 1105.91 1131.50
1131.50
- 1018.22
= 113.28
÷ 1018.22
= 11.1%
Calculating Monthly Point to Point
• Subtract the starting value from the current value
Date S&P Value
Oct. 1 1018.22
Nov. 3 1059.02
1059.02 – 1018.22 = 40.80
• Divide the sum by the starting value• Record the Index Change and New Starting point
for the next month
40.80 ÷ 1018.22 = 4.0%
Index Change for 1st month = 4.0%
Starting point for 2nd month = 1059.02
Monthly Point to PointOne Year Option
Date S&P Closing Value
Percentage Change
Capped Increase*
October 1, 2003 1018.22 0% 0%
November 3, 2003
1059.02 4.00% 3.00%
December 1, 2003
1070.12 1.04% 1.04%
January 2, 2004 1108.48 3.58% 3.00%
February 2, 2004 1135.26 2.42% 2.42%
March 1, 2004 1155.97 1.82% 1.82%
April 1, 2004 1132.17 -2.05% -2.05%
May 3, 2004 1117.49 -1.29% -1.29%
June 1, 2004 1121.20 0.33% 0.33%
July 1, 2004 1128.94 0.69% 0.69%
August 2, 2003 1106.62 -1.98% -1.98%
September 1, 2004
1105.91 -0.06% -0.06%
October 1, 2004 1131.50 2.31% 2.31%
First Year Credited Rate 9.23%*3%Cap
Which Was PROBABLY More Beneficial To Consumer
•Monthly Point to Point…9.23%
•Monthly Average…9.44%•Annual Point to Point…11.1%
Monthly Point to PointOne Year Option
Date S&P Closing Value
Percentage Change
Capped Increase*
October 1, 2003 1018.22 0% 0%
November 3, 2003
1059.02 4.00% 3.00%
December 1, 2003
1070.12 1.04% 1.04%
January 2, 2004 1108.48 3.58% 3.00%
February 2, 2004 1135.26 2.42% 2.42%
March 1, 2004 1155.97 1.82% 1.82%
April 1, 2004 1132.17 -2.05% -2.05%
May 3, 2004 1117.49 -1.29% -1.29% (+1%)
June 1, 2004 1121.20 0.33% 0.33%
July 1, 2004 1128.94 0.69% 0.69%
August 2, 2003 1106.62 -1.98% -1.98% (+1%)
September 1, 2004
1105.91 -0.06% -0.06%
October 1, 2004 1131.50 2.31% 2.31%
First Year Credited Rate 9.23% (+14.5%)*3%Cap
Index Crediting Assumptions
• Monthly Point to Point Cap…3%• Monthly Average Cap…10%• Annual Point to Point Cap…9%• Closing Prices on First Business Day of each Month
1991 S&P Performance
Dates Index number Monthly Change Accrued
January 330.20
February 343.91 4.18% 3.00%
March 367.07 6.73% 3.00%
April 375.22 2.22% 2.22%
May 375.35 0.03% 0.03%
June 389.81 3.85% 3.00%
July 371.18 -4.78% -4.78%
August 387.81 4.48% 3.00%
September 395.43 1.96% 1.96%
October 387.86 -1.91% -1.91%
November 392.46 1.19% 1.19%
December 375.11 -4.42% -4.42%
January 417.03 11.18% 3.00%
Index Crediting Assumptions
• Monthly Point to Point Total…24.69%3% Monthly Cap Total…9.29%Credited Amount…9.29%
• Monthly Annual Average…15.54%10% Annual Cap Credited…10.00%
• Annual Point to Point …26.30%9% Annual Cap Credited…9.00%
1995 S&P Performance
Dates Index number Monthly Change Accrued
January 459.21
February 470.42 2.44% 2.44%
March 487.39 3.61% 3.00%
April 500.70 2.73% 2.73%
May 514.75 2.81% 2.81%
June 533.40 3.62% 3.00%
July 544.75 2.13% 2.13%
August 562.06 3.18% 3.00%
September 561.88 -0.03% -0.03%
October 584.41 4.01% 3.00%
November 581.50 -0.50% -0.50%
December 605.37 4.10% 3.00%
January 615.93 1.74% 1.74%
Index Crediting Assumptions
• Monthly Point to Point Total…29.84%3% Monthly Cap Total…26.32%Credited Amount…26.32%
• Monthly Annual Average…19.09%10% Annual Cap Credited…10.00%
• Annual Point to Point …34.13%9% Annual Cap Credited…9.00%
1998 S&P Performance
Dates Index number Monthly Change Accrued
January 970.43
February 980.28 1.02% 1.02%
March 1,049.34 7.04% 3.00%
April 1,101.75 4.99% 3.00%
May 1,111.75 0.91% 0.91%
June 1,080.82 -1.88% -1.88%
July 1,133.84 3.94% 3.00%
August 1,120.67 -1.16% -1.16%
September 957.28 -14.58% -14.58%
October 1,017.01 6.24% 3.00%
November 1,098.67 8.03% 3.00%
December 1,163.63 5.91% 3.00%
January 1,229.23 5.64% 3.00%
Index Crediting Assumptions
• Monthly Point to Point Total…26.10%3% Monthly Cap Total…5.30%Credited Amount…5.30%
• Monthly Annual Average…12.10%10% Annual Cap Credited…10.00%
• Annual Point to Point …26.67%9% Annual Cap Credited…9.00%
2003 S&P Performance
Dates Index number Monthly Change Accrued
January 879.82
February 855.70 -2.74% -2.74%
March 841.15 -1.70% -1.70%
April 848.18 0.84% 0.84%
May 916.92 8.10% 3.00%
June 963.59 5.09% 3.00%
July 974.50 1.13% 1.13%
August 990.31 1.62% 1.62%
September 1,008.01 1.79% 1.79%
October 995.97 -1.19% -1.19%
November 1,050.71 5.50% 3.00%
December 1,058.20 0.71% 0.71%
January 1,111.92 5.08% 3.00%
Index Crediting Assumptions
• Monthly Point to Point Total…24.22%3% Monthly Cap Total…12.45%Credited Amount…12.45%
• Monthly Annual Average…10.01%10% Annual Cap Credited…10.00%
• Annual Point to Point …26.38%9% Annual Cap Credited…9.00%
2004 S&P Performance
Dates Index number Monthly Change Accrued
January 1,108.48
February 1,131.13 2.04% 2.04%
March 1,144.94 1.22% 1.22%
April 1,126.21 -1.64% -1.64%
May 1,107.30 -1.68% -1.68%
June 1,120.68 1.21% 1.21%
July 1,140.84 1.80% 1.80%
August 1,101.72 -3.43% -3.43%
September 1,114.58 1.17% 1.17%
October 1,120.27 0,51% 0.51%
November 1,130.88 0.95% 0.95%
December 1,177.14 4.09% 3.00%
January 1,213.55 5.09% 3.00%
Index Crediting Assumptions
• Monthly Point to Point Total…9.34%3% Monthly Cap Total…8.15%Credited Amount…8.15%
• Monthly Annual Average…2.46%10% Annual Cap Credited…2.46%
• Annual Point to Point …9.48%9% Annual Cap Credited…9.00%
Potential vs. Protection
-40% 0% +40%+20%-20%
INVESTMENT
INDEX ANNUITY
$$
Why Index Annuities
+ 40%
- 40%
+2.35%
Investments Savings Program
Participate in all or a portion of the S&P and/or DJIA
$
Index Annuity vs. Market
And, of course….
Thanks for your business……..