Inflation - AXA Equitable |
How Can My Retirement Income Keep Pace With Inflation?
No matter how much money you save through your retirement investing, the threat of rising inflation means that the money you put away for your retirement security today may be worth a lot less in 10 or 20 years. In fact, at a rate of just 3% inflation, in 15 years the everyday items you buy will cost 50 percent more than what they cost today. And with the recent turmoil in the economy, there’s a possibility that inflation may be on the rise over the next few years.
So how can a savvy investor help their retirement savings keep pace with inflation? At AXA Equitable, we have a long history of developing innovative products to help with retirement savings. One of our most recent products is Retirement CornerstoneSM, a variable annuity with an optional benefit that lets you potentially grow your retirement assets while addressing inflation concerns.
What is a variable annuity? A variable annuity is a long-term financial product designed for retirement purposes. Simply stated, an annuity is a contract between you and an insurance company that lets you pursue the accumulation of assets through stock (equity) and other investment portfolios, and then receive lifetime payments during the distribution phase of the contract. There are contract limitations and fees and charges associated with annuities, including mortality and expense risk charges, sales and surrender charges, administrative fees, and charges for optional benefits.
AXA Equitable Helps Address Inflation Concerns With Retirement Cornerstonesm
AXA Equitable is one of the nation’s leading financial protection companies and providers of life insurance, annuities and related products and services.
Retirement Cornerstone is a tax-deferred variable annuity that comprises two distinct accounts – one focused on growing assets and investment performance, the other on providing innovative retirement protection:
- The Performance Account is managed by well-known and well-respected investment managers and offers a wide-ranging investment universe for greater investing flexibility, helping you pursue investment returns that provide the opportunity to keep pace with, or potentially outpace, inflation.
- The Protection with Investment Performance Account offers a specially designed selection of more focused investment portfolios and offers, at an additional fee, an optional Guaranteed Income Benefit rider* (subject to income restrictions and age limitations), which includes a flexible guaranteed Roll-Up Rate. A Roll-Up Rate is the annual percentage increase to a living benefit rider’s “benefit base.” The benefit base is used to calculate a guaranteed minimum income (or withdrawal) amount. Retirement Cornerstone’s flexible guaranteed Roll-Up Rate allows you to benefit from a rising interest rates environment. Your "Roll-Up Benefit Base" initially has a value equal to the amount you first contribute or transfer into the Protection with Investment Performance Account. It is guaranteed to "rollup" each year (until age 95) by a percentage at least equal to recent average interest rates of 10-year Treasury notes plus 1.50% if you take no withdrawals from the Protection with Investment Performance Account during the year.
This deferral bonus Roll-Up rate can go as high as 8% but will not go lower than 4%.
Once you begin taking withdrawals, the formula is equal to the 10-year Treasury plus 1.00%. This annual roll-up rate can also go as high as 8%, and will not go below 4%.
Because 10-Year Treasury rates have historically outperformed inflation over the long term, your Benefit Base thus has the opportunity to keep pace with inflation.
*The Guaranteed Income Benefit rider is issued with all eligible contracts unless the contract owner "opts out" at the time of application.
Learn more now about addressing inflation concerns with annuities or a retirement annuity from AXA Equitable.
Please consider the charges, risks, expenses, and investment objectives carefully before purchasing a variable annuity. For a prospectus containing this and other information about the variable annuity, underlying investments and any applicable supplements, please contact a financial professional. Read the prospectus carefully before you invest or send money.
Important Information
Certain features available with the Retirement Cornerstone® variable annuity, including enhanced death benefits, are optional and entail an additional cost; you do not have to elect these optional features in order to purchase a Retirement Cornerstone® contract. Also, the IRS requires the owner of an IRA or Qualified Plan annuity contract to include the actuarial present value of certain optional benefits (which may include some of these Retirement Cornerstone® optional features) in the calculation of lifetime Required Minimum Distribution payments. Withdrawals from an annuity contract are taxable as ordinary income, not as capital gain and, if made prior to age 59½, may be subject to an additional 10% federal income tax penalty. Withdrawals may also be subject to surrender charges. Withdrawals may reduce the death benefit, living benefit and cash surrender value. For tax purposes, withdrawals will come from any gain in the contract first.
AXA Equitable may discontinue contributions and transfers among investment options or make other changes in contribution and transfer requirements and limitations. If we discontinue contributions and transfers into the Guaranteed Benefit Account, you will no longer be able to create a Benefit Base or actively increase the benefit(s).
Market Risk
Variable annuity subaccounts fluctuate with changes in market conditions. When surrendered the principal may be worth more or less than the original amount invested. This piece is not a complete description of all material provisions of the Retirement Cornerstone® variable annuity contract. The prospectus contains more complete information, including investment objectives, risks, charges, expenses, limitations and restrictions. Please read the prospectus and any applicable supplements, and consider this information carefully before purchasing a contract.
Fees and Expenses
There are fees and charges associated with the Retirement Cornerstone® contract, which include, but are not limited to, mortality and expense risk charges, sales and withdrawal charges, administrative fees, and additional charges for optional benefits. The contingent withdrawal charge declines from 7% over a seven-year period for the Series B product. Please see the prospectus for the withdrawal charge scale for other annuities in the Retirement Cornerstone® Series. Amounts in the annuity’s variable investment portfolios are subject to fluctuation in value and market risk, including loss of principal. For costs and complete details of coverage, speak to your financial professional. Certain types of contracts, features and benefits may not be available in all jurisdictions. We offer other variable annuity contracts with different fees, charges and features. Not every contract is available through the same selling broker/dealer.
You can contact us at (212) 554-1234 to find out the availability of other contracts.
AXA Equitable Life Insurance Company, through its AXA Funds Management Group (AXA FMG), serves as investment manager of the AXA Strategic Allocation Portfolios. AXA Equitable is solely responsible for the asset allocation decisions made on behalf of each portfolio, and for the selection and allocation of assets to underlying funds.
This website was prepared to support the promotion and marketing of AXA Equitable variable annuities. AXA Equitable, its distributors and their respective representatives do not provide tax, accounting or legal advice. Any tax statements contained herein were not intended or written to be used, and cannot be used, for the purpose of avoiding U.S. federal, state or local tax penalties. Please consult your financial professional as to any tax, accounting or legal statements made herein.
Guarantees described herein are subject to the claims-paying ability of AXA Equitable Life Insurance Company. The guarantees do not apply to the investment portfolios.
Retirement Cornerstone® is a service mark of AXA Equitable Life Insurance Company, New York, NY 10104. Retirement CornerstoneSM variable annuities are issued by AXA Equitable Life Insurance Company, New York, NY 10104.
Co-distributed by affiliates AXA Advisors, LLC and AXA Distributors, LLC, New York, NY 10104.
AXA Equitable, AXA Advisors and AXA Distributors do not provide legal or tax advice.
Contract form #s: 2010BASE-A/B, 2010BASE-I-A/B, 2010BASE-I-A(WA) and any state variations
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