[Narrator] Question: What are my options for growing my retirement assets? Allianz Answers.
When it comes to building your assets to help pay for your retirement, the basic investing concept you first need to understand is the relationship between risk and return. Generally speaking, the greater the potential for return, the higher the risk that this asset could lose value. On the other hand, when the risk is lower for an asset, then your potential return tends to be lower too.
The key to investing is to know how much risk you can tolerate for the potential returns you're hoping for. One well-established strategy for this is a balanced portfolio containing a mix of asset classes, usually including growth assets, like stocks or equities and other assets like bonds and bond funds to help provide stability.
By increasing or decreasing the proportions of each, you're able to customize a balance between risk and return that may be appropriate for your long-term financial goals and your own tolerance for risk. That's been an effective strategy for the past three decades.
But now, the financial landscape has changed dramatically and heightened the risks for both equities and bonds. Bonds are being challenged by low yields, as well as the possibility of rising interest rates, which can stress bond returns even more. That may put more pressure on the rest of your portfolio to make up the difference with greater returns on the equities portion, even though equities are inherently more volatile with the possibility of another significant market downturn always present. And if that happens, you may not have time to rebuild the value of your portfolio before you retire.
So, how are you going to grow your assets? Do you accept greater risk in order to get potentially greater returns or do you seek a lower risk, even if that makes it more difficult to build up your assets and could delay your retirement?
Option one or option two? Not an easy choice, is it?
So, how about a third option? One that can help you seek long-term financial returns and potentially reduce the risk in market volatility.
In this option, along with equities and bonds, you may choose to use a portion of your portfolio to purchase an asset called an index variable annuity or IVA. An index variable annuity is an insurance product that provides the opportunity to build a portion of your retirement assets tax deferred.
[On-screen disclosure] Purchasing an annuity within a retirement plan that provides tax deferral under sections of the Internal Revenue Code results in no additional tax benefit. An annuity should be used to fund a qualified plan based on the annuity’s features other than tax deferral. [End of on-screen disclosure]
With a variety of annuity payout options, and a built-in death benefit during the accumulation phase, an index variable annuity also gives you the choice of allocations that may offer different levels of protection and performance potential through various index or variable options, so you can create a different balance of risk and return potential that may be appropriate to you.
[On-screen disclosure] All withdrawals are subject to ordinary income tax and, if taken prior to age 59½, may be subject to a 10% federal additional tax. [End of on-screen disclosure]
Please note that variable annuities are subject to investment risk, including possible loss of principal. Investment returns and principal value will fluctuate with market conditions, so that units upon distribution may be worth more or less than the original cost.
So, if you need to grow your retirement assets and are concerned about having a portfolio with too much risk or too little potential return, including an index variable annuity can help you create a different balance between risk and return potential that can help meet your goals.
Talk to your financial professional about how an index variable annuity may be appropriate for your retirement strategy. You can also learn more about index variable annuities and their features at AllianzLife.com or Allianzlife.com/new-york.
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Allianz Life Insurance Company of North America
Allianz Life Insurance Company of New York
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For more complete information about Allianz and Allianz Life of NY variable annuities and variable options, call Allianz Life Financial Services, LLC, member FINRA, at 800.624.0197 for a prospectus.
The prospectuses contain details on investment objectives, risks, fees, and expenses, as well as other information about the variable annuity and variable options, which you should carefully consider. Please read the prospectuses thoroughly before sending money.
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This video is general information for educational purposes, and is not intended to constitute fiduciary advice. Please consult your financial professional for a specific recommendation about purchasing this product.
Annuities are designed to meet long-term needs for retirement income. They provide tax-deferred growth potential, a death benefit during the accumulation phase, and a guaranteed stream of income at retirement.
Withdrawals will reduce the contract value and the value of any protection benefits. Withdrawals taken within the contract withdrawal charge schedule will be subject to a withdrawal charge. All withdrawals are subject to ordinary income tax and, if taken prior to age 59½, may be subject to a 10% federal additional tax.
Guarantees are backed by the financial strength and claims-paying ability of the issuing company and do not apply to variable annuity subaccounts, which will fluctuate with market conditions.
Products are issued by Allianz Life Insurance Company of North America, 5701 Golden Hills Drive, Minneapolis, MN 55416-1297. www.allianzlife.com. In New York, products are issued by Allianz Life Insurance Company of New York, 1633 Broadway, 42nd Floor, New York, NY 10019-7585. www.allianzlife.com/new-york
Variable products are distributed by their affiliate, Allianz Life Financial Services, LLC, member FINRA, 5701 Golden Hills Drive, Minneapolis, MN 55416-1297.
Only Allianz Life Insurance Company of New York is authorized to offer annuities and life insurance in the state of New York.
• Not FDIC insured • May lose value • No bank or credit union guarantee • Not a deposit • Not insured by any federal government agency or NCUA/NCUSIF
Product and feature availability may vary by state and broker/dealer.
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Allianz Life Insurance Company of North America
Allianz Life Insurance Company of New York
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