You are on page 1of 3

Advanced Markets Group | P R I V A T E

Advanced Markets Group

SunSolutions For Life
Target Market


Private Retirement Accumulator Using Sun Universal ProtectorPlus
Jon Bentley is a 45 year old married male with 2 children and an annual income of $90,000 plus bonuses and incentives. Jon and his wife have been contributing to a college fund and saving for retirement. They are currently reviewing their planning and have two main concerns they wish to address: (1) If Jon dies at an early age, their college fund may fall short, especially if one or both children go to graduate school. (2) Jon plans to retire at age 65 and he and his wife expect to maintain their lifestyle as well as travel more during retirement. Although Jon fully funds his 401(k) plan, the Bentleys will require further savings to meet their goals. They are exploring options that offer family protection, good growth potential, and relative safety of their assets.


Product Solution
Their financial advisor has discussed several ways they can build a fund to protect the family during Jon’s working years, including one with tax deferred growth during the accumulation phase that also provides for the family in the event of early death. After comparing the internal rate of return (IRR) and relative safety on taxable investments with the IRR and relative safety on the tax deferred plans, they are more comfortable with the latter. Although state law creditor protection and the safety net of the death benefit during their accumulation years are important to them, they also want sufficient funds available at retirement. The Bentleys selected Sun Universal ProtectorPlus for its increasing death benefit during the years when they may need it the most and the healthy income potential at retirement.

How It Works
Given the Bentleys’ objectives, they have chosen to fully fund a stated death benefit sufficient to protect the family in the event Jon dies at a younger age, while also building significant cash value for their retirement if Jon lives to his normal life expectancy. Their planned premium outlay is $25,000 each year for 20 years. During that period, the death benefit builds significantly. In year 21, they expect to begin taking an income stream from the policy upon Jon’s retirement. A major influence on their decision was the array of policy riders1 available on Sun Universal ProtectorPlus. The Assist America rider, which provides emergency travel assistance when traveling more than 100 miles from home, is particularly important to them since they plan to travel extensively in retirement, and were pleased to know the Accelerated Benefits Rider will be attached to their policy at no cost, in the event of terminal illness. The Bentleys also like the flexibility for contributing additional funds (up to MEC limits) during the accumulation phase if they so wish.

Accelerated Benefits Rider, Assist America Rider, Charitable Giving Rider, Overloan Protection Rider, Waiver of Monthly Deductions, and the Supplemental Insurance Rider, in addition to the Honeymoon Provision. Not all riders are avilable in all states.

XMSD 44/576 SLPC 17782 08/08 Exp. Date 08/09 PAGE 1 of 3

Retirement Income Goal Achieved
If Jon dies before retirement, the family will receive a significant death benefit, as shown on the chart below. If he lives to enjoy a long retirement, the Bentleys will receive income (through withdrawals to basis and loans against the policy cash values) in excess of $70,000 each year for 15 years to supplement their other retirement income2. After their final distribution from the Sun Life ProtectorPlus policy, they will have recovered their basis of $500,000 and received an additional $557,470, for a total supplemental retirement income of $1,057,4702 — tax free3!

Example Accumulation Phase Year 1 5 10 15 20 Total Age 46 50 55 60 65 Premium Outlay4 25,000 25,000 25,000 25,000 25,000 $500,000 Cash Surrender Value4 12,803 116,554 279,551 485,964 767,937 Death Benefit 505,755 607,868 768,551 972,278 972,278

Distribution Phase Year 21 25 30 35 Total Age 66 70 75 80 Total Income Distributions4 -70,498 -70,498 -70,498 -70,498 $1,057,470 Cash Surrender Value4 734,573 582,671 333,395 16,776 Death Benefit4 901,780 675,898 372,540 49,979

Assumes an interest rate of 4.85% for the first 15 years, with a contractually guaranteed interest bonus of 0.65% for years 16-55. Sun Life Assurance Company of Canada will actually credit interest and charge for mortality as experience requires. This will result in policy values that may be greater or less than those illustrated. However, in no event will values be lower than those on the guaranteed basis. 3 Basis is received tax free; loans will not be taxable as long as the policy remains in force during the insured’s lifetime. 4 Policy remains in force at age 100, with $85 cash value and death benefit, illustrated on Basis #2. The Private Retirement Accumulator should not be used without an accompanying illustration showing guaranteed and non-guaranteed projections. The Overloan Protection Rider, which protects the policy from lapsing, is an option that can be exercised for a one time charge; certain conditions apply.

XMSD 44/576 SLPC 17782 08/08 Exp. Date 08/09 Page 2 of 3

This is only a brief description of a one of many complex estate planning options. It is not meant as legal or tax advice, and it is not appropriate for everyone. Consult with your own financial and tax advisor regarding the application of these concepts to your particular situation.

For more information, please contact your Sun Life Financial Representative.

This information contains references to concepts that have significant legal, accounting and tax implications. It is not intended as legal, accounting or tax advice. Clients should consult with their own financial and tax advisor regarding the application of these concepts to any particular situation. Not FDIC/NCUA insured. May lose value. No bank/credit union guarantee. Not a deposit. Not insured by any federal government entity. Universal life insurance is issued by Sun Life Assurance Company of Canada (Wellesley Hills, MA) or in New York, Sun Life Insurance and Annuity Company of New York (New York, NY). All guarantees are based on the claims-paying ability of the issuing company, Sun Life Assurance Company of Canada (Wellesley Hills, MA), or in New York, Sun Life Insurance and Annuity Company of New York (New York, NY). All are members of the Sun Life Financial group of companies. ©2008 Sun Life Assurance Company of Canada. All rights reserved. Sun Life Financial and the globe symbol are registered trademarks of Sun Life Assurance Company of Canada.

XMSD 44/576 SLPC 17782 08/08 Exp. Date 08/09 Page 3 of 3