A REALISTIC SCENARIO. Jim (57) and Janet (55) are both ready to retire 10 years from now and — like many other couples — want to experience the same lifestyle in retirement that they’ve grown accustomed to during their working years. They have saved $200,000 in a 401(k), and they don’t want to risk any of that directly in a volatile market. However, they would like to grow that amount by the time they retire. Knowing that their premium would be 100% protected, they purchased a $200,000 Heritage Growth Advantage using their 401(k). They invested $100,000 in the Fixed Account, where it will earn 2.5% regardless of market performance. The other $100,000 was invested in an indexed account with a 90% participation rate. You can see in the chart below how the account value for the Fixed Rate grew steadily, while the Indexed Rate grew at 90% of the index’s growth each term. Combined — over the surrender period — the two rates grew Jim and Janet’s $200,000 to $294,361, making for a more comfortable retirement.
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$0
Contract Start
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Index Account Value
Fixed Account Value
This is a hypothetical example and is not intended to predict future performance. This assumes no withdrawals taken during the 10 years shown.
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