Podcast stresses guarantees, education when planning for retirement
NEWARK, N.J.–(BUSINESS WIRE)– The recent stock market rally has not restored the confidence of investors shaken by the hit to their retirement savings during the financial crisis. This has left them unsure how to capitalize on the market surge to place them on a more secure path through retirement.
In a seven-minute podcast released today, Prudential Financial (NYSE: PRU) retirement experts outline potential steps that both retail and institutional consumers can take to boost their retirement savings.
In the podcast, Jamie Kalamarides, senior vice president, Retirement Solutions, Prudential Retirement, and Jacob Herschler, senior vice president, Business Strategy, Prudential Annuities, reinforce the value of guaranteed income as a critical component of retirement planning for all Americans, particularly in a post-recession environment.
“The past eighteen months have demonstrated the devastating effects market volatility can have in the critical years leading up to and immediately following retirement,” Kalamarides said. “Guaranteed retirement income options are a proven solution for managing this risk.”
Individuals need to build diversified savings plans – whether inside or outside of workplace savings plans like 401(k)s – to ensure they can achieve their retirement goals, according to the Prudential experts. The podcast underscores the role that institutions and financial advisors can play in educating Americans about the value of guaranteed income in creating retirement security.
Herschler emphasizes that some investors may spend 30 or more years in retirement, and need to plan accordingly. He also stresses the importance of developing a long-term retirement income strategy that not only provides stability, but also has the flexibility to adapt to changing needs in retirement.
“It’s important for both advisors and clients to get educated about the kinds of solutions that are available today,” Herschler said. “Investors need to do their homework and come armed with information to discussions with their advisors.”
Investors are seeking investments providing guaranteed returns and want guaranteed income options as a part of their workplace retirement plans. According to “The Impact of the Market Crisis on Retirement Preparedness,” two-thirds of survey respondents said they would likely pursue a retirement savings solution that offers guaranteed income. Additionally the “Sixth Workplace Report on Retirement Planning,” revealed 71 percent of younger workers and 64 percent of older workers indicated they would prefer an in-plan option that would automatically convert their assets into a guaranteed stream of lifetime retirement income.
“The goal of retirement planning should be to create a paycheck for life,” Kalamarides said. “Incorporating guarantees into workplace retirement plans help ensure that participants don’t outlive their assets. Advisors play a critical role in this process.”
The leader in institutional guaranteed income solutions Prudential Retirement was first to market in 2006 with its in-plan option, IncomeFlex, which adds a guaranteed income component to existing defined contribution plans. Prudential Annuities, the nation’s top seller of variable annuities in 2009, launched its Highest Daily optional living benefit in 2006. Available for an additional fee, Highest Daily guarantees are variable annuity optional living benefits that capture an annuity’s highest day, for income purposes, each day that the market is open and grow that value at an annual compounded rate until the first Lifetime Withdrawal.
Guarantees are based on the claims-paying ability of the insurance company and are subject to certain limitations, terms and conditions. To maintain the IncomeFlex benefit, you must invest in one or more Prudential IncomeFlex Funds. Like all variable investments, these funds may lose value. Guaranteed growth of the income base ends at age 70 or when guaranteed withdrawals begin, whichever is earlier. Withdrawals in excess of the guaranteed lifetime income amount will reduce future guaranteed withdrawals proportionately.
Prudential IncomeFlex Funds are separate accounts available under group variable annuity contracts issued by Prudential Retirement Insurance and Annuity Company (PRIAC). PRIAC does not provide any guarantee of the investment performance or return of contributions to those separate accounts.
PRIAC’s guarantee of certain withdrawals is supported by PRIAC’s general account and is contingent on its claims paying ability. Guarantees are subject to certain limitations, terms and conditions. Investors should consider the objectives, risks, charges, and expenses of the funds and guarantee features before investing. You should carefully review the Prudential IncomeFlex Important Considerations before investing.
Neither Prudential Financial nor any of its representatives are tax or legal advisors and encourage you to consult your individual legal or tax advisor with any specific questions.
Investors should consider the contract and the underlying portfolios’ investment objectives, risks, charges and expenses carefully before investing. This and other important information is contained in the prospectus, which can be obtained from your financial professional.Please read the prospectus carefully before investing.
A variable annuity is a long-term investment designed to create lifetime income in retirement. Investment returns will fluctuate and the principal value, when redeemed, may be worth more or less than the original investment.
Optional living benefits may not be available in every state and may not be elected in conjunction with certain optional benefits. Optional benefits have certain investment, holding period, liquidity, and withdrawal limitations and restrictions. The benefit fees are in addition to fees and charges associated with the basic annuity. Please see the prospectus for more information.
Variable annuities are issued by Pruco Life Insurance Company (in New York, by Pruco Life Insurance Company of New Jersey), Newark, NJ, or by Prudential Annuities Life Assurance Corporation, Shelton, CT. All are distributed by Prudential Annuities Distributors, Inc., Shelton, CT. All are Prudential Financial companies and each is solely responsible for its own financial condition and contractual obligations. Prudential Annuities is a business of Prudential Financial, Inc.
Prudential Retirement delivers retirement plan solutions for public, private, and non-profit organizations. Services include state-of-the-art record keeping, administrative services, investment management, comprehensive employee investment education and communications, and trustee services. With over 85 years of retirement experience, Prudential Retirement helps meet the needs of over 3.6 million participants and annuitants. Prudential Retirement has $178.3 in retirement account values as of December 31, 2009.
Prudential Financial, Inc. (NYSE: PRU), a financial services leader with approximately $667 billion of assets under management as of December 31, 2009, has operations in the United States, Asia, Europe and Latin America. Leveraging its heritage of life insurance and asset management expertise, Prudential is focused on helping individual and institutional customers grow and protect their wealth. In the U.S., the company’s Rock symbol is an icon of strength, stability, expertise and innovation that has stood the test of time. Prudential’s businesses offer a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds, investment management, and real estate services. For more information, please visit www.news.prudential.com.
Prudential Financial, Inc.
Josh Stoffregen, 973/802-3996
Alicia Rodgers Alston, 973/802-4446
Source: Prudential Financial, Inc.