Annuities Mark Ricklefs CLU ChFC CFP

Caveat This presentation is for informational purposes only. The speaker appearing at this meeting is solely responsible for the content of the presentation and may not necessarily represent the opinion of the presenter. The presenter is not in the business of giving tax, legal or accounting advice. Attendees should consult with their own professional advisors to determine the appropriateness of any course of action. Mark Ricklefs is an Investment Advisor Representative offering securities and investment advisory services through Ameritas Investment Corp. (AIC). The opinions and concepts discussed in this presentation are for CE purposes only and are not necessarily those of AIC. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

What is an annuity? -An annuity is a long-term tax-deferred investment that is designed for retirement. -It will fluctuate in value. -It enables you to create a fixed or variable stream of income. -It provides a variable rate of return based on performance of the investments The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

What is an annuity? -An annuity does have limitations. -If you take money out early, you face surrender charges. -If you take an early withdrawal, your death benefit and cash value of the annuity contract reduce. -Annuities contain guarantees and protections subject to the issuing insurance company’s ability to pay for them (do not apply to variable accounts that are subject to investment risk, including possibly loss of principal). -Variable annuities have fees and charges that include mortality and expense, admin fees, contract fees, and the expense of the underlying investment options. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

What is an annuity? - An annuity is a contract between an individual and an insurance company where in return for receiving one or more premiums from the individual, the insurer agrees to pay a regular income for a specified period or for the life of the individual. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Types of Annuities If the payee is to begin receiving income from the annuity in the future, the annuity is deferred. An immediate annuity is purchased only with a single premium and begins to make annuity payments right away. A single-premium deferred annuity requires the owner to fund the annuity with a single payment. A flexible-premium deferred annuity allows the owner to make small periodic payments over the life of the annuity until income payments begin. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

VA Contract The amount the owner pays varies within the limits established by the issuing insurer. Premium payments may be increased or decreased as the owner desires. The return on a VA is subject to market fluctuations. VAs have potential for a greater return than fixed annuities. Theoretically, this allows them to keep pace with inflation. The most significant way a VA varies from a fixed annuity involves investment of the premiums. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

VA Contract Guarantees are subject to the insurers’ claims- paying ability. VAs have a market risk, including the possible loss of principal The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Investment Options VA owners can select from a variety of sub-accounts in deciding where to allocate their premium dollars. With a variable annuity, the owner assumes the investment risk. Variable investment options include: -Money markets -Bonds -Stocks -A balance of stocks and bonds -Government securities The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Investment Options The owner may reallocate the annuity cash values among the different options in response to changes in the economy or their preferences. The final annuity amount is unknown, as there is no guarantee of principal Past performance is no guarantee of future results. In some cases, owners may put part of the premium in a fixed account to guarantee a portion of the principal. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Accumulation Units Premiums paid into the variable investment options during the accumulation phase are used to buy “accumulation units”. Accumulation units credited to the contracts are determine by the values of the chosen variable option. The annuity contract will have a built-in formula for the amount. The number of accumulation units that can be purchased by the same premium amount fluctuate in response to market rates. VA values change during the accumulation phase based on the performance of the options that the owner has selected. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Earnings VA earnings are intended to stay in the contract to accumulate. These are tax-deferred earnings as long as they stay within the contract. When earnings are withdrawn, they are taxed as income. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Distribution Early withdrawals (prior to age 59 ½) reduce death benefit and cash value of the contract and are subject to a 10% tax penalty and surrender charges. VAs are considered long-term propositions. Annuities permit the tax-free recovery of principal premium over life expectancy. A 10% tax penalty enforced by the IRS will be placed on early full and/or partial withdrawals. No penalty is enforced if the VA owner becomes disabled or dies. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Payout A VA owner may select a fixed payout. The amount of the payment is thus determined using the settlement options available for a fixed annuity. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Payout Strategies Straight-life or life-only annuity – provides maximum periodic payout to the owner, but payments end at the time of the owner’s death. Joint-and-last-survivor annuity – Payments are made until the last of the owners dies. The payout may reduce after the death of the first owner. Period-certain annuity – Income is paid for a specific period of time until this period is complete. Amount-certain annuity – A specified amount will be paid regularly. Refund annuity – Upon death of the owner, beneficiary will receive payments until the premium is paid. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.

Final Considerations VAs offer choices of how funds are paid in, how they are grown, and how they are paid out. However, VAs have limitation and involve risk and the possible loss of principal. The presenter is not in the business of giving tax, legal, or accounting advice. Please consult your personal advisors.