Sun Life Financial, Money for Life

0:05 an important part of money for life is planning for your basic living
0:09 health lifestyle and legacy needs in retirement
0:13 figuring out how much you'll spend on each one can be tough
0:16 and that's where your advisor can help the best place to get started
0:21 is by understanding what your basic living needs will be
0:24 things like food and having a place to call home and how you cover them
0:29 government programs like Canada Pension Plan
0:32 orkut bed pension plan and old age security will help you in retirement
0:37 you might even have a company pension plan to
0:40 I love these are guaranteed sources have income
0:43 you can count on throughout retirement but if these aren't enough to cover your
0:47 basic living needs
0:49 does this mean you're doomed to spend your retirement eating peanut butter and
0:52 jam sandwiches
0:54 and never having any fun of course not
0:57 a life annuity is a great solution they can help you cover the basics
1:02 first
1:04 with a life annuity you give the insurance company
1:07 a lump sum of money up front called a premium in return
1:11 the promise to pay you a guaranteed monthly check
1:14 no matter how long your retirement lasts or how the markets perform
1:18 your monthly check is made up of three parts:
1:21 part of it is a return of some of the original premium you paid
1:25 party that is interest earned on the premium imparted to something called
1:30 and insurance credit the insurance credit makes it possible
1:34 for you to get the highest level of guaranteed lifetime income
1:37 and you can only get it with the life annuity here's how it works
1:42 when you buy a life annuity the insurance company
1:45 isn't just investing your premium instead
1:48 it's invested together with premiums paid by lots of other people
1:53 who also bought life annuities insurance companies guaranteed the ability to pay
1:58 your check
1:59 based on their best estimate that some people live longer than average
2:03 well others will have a shorter than expected life span
2:07 for those who die earlier unless they've purchased a guaranteed period
2:11 the insurance companies still keeps investing the remaining part is the
2:14 premium they paid
2:15 which keeps earning interest and helps pay for those who live longer
2:19 wanna that the insurance credit what's terrific about the insurance credit
2:25 is that the insurance company not you takes on the risk
2:29 that you could live to be 105 or older
2:32 and they'll have to pay your income for much longer than the originally thought
2:36 at this point you might be thinking hey
2:39 I want money to go to my family after I'm gone well
2:43 you can choose to take a smaller monthly check in exchange for adding a guarantee
2:47 period to your life annuity
2:49 if you pass away during this time frame your beneficiary will still get a
2:54 monthly check
2:55 until the guarantee period ends or in some cases
2:59 a lump sum payment
3:01 unlike other products that generate investment returns
3:04 like mutual funds and GI sees some life annuities may qualify for special tax
3:09 treatment
3:10 which can help you keep more money in your pocket to cover basic living needs
3:15 your advisor can tell you more about how life annuities are taxed
3:19 and why this can work to your advantage you always need to cover your basic
3:24 living needs
3:25 in retirement a life annuity gives you the security of knowing you'll have a
3:29 guaranteed monthly check no matter how long your retirement lasts
3:33 you could pay less tax on the income you earn and you even have the option to
3:38 leave
3:39 a legacy talk to your advisor about how a life annuity can help you cover the
3:44 basics