Consider Pacific Advisory Fixed Indexed Annuity for pre-retirees and retirees who:
Pacific Advisory Fixed Indexed Annuity combines the guarantees of a fixed annuity with the growth potential linked to the performance of market-based indexes. It’s not a security, and money is not directly invested in the market. It offers:
All guarantees are subject to the claims-paying ability and financial strength of the issuing insurance company.
Withdrawal Charges and Fees
Pacific Advisory Fixed Indexed Annuity has no withdrawal charges. During the 5-year initial option period, a positive or negative market value adjustment (MVA) may apply on certain withdrawals.
Advisory Fee Withdrawals
When paid from nonqualified (previously taxed) contracts, advisory fee withdrawals are not treated as taxable distributions if the fee does not exceed an annual rate of 1.50% of the contract value during the calendar year. Withdrawals from the contract to pay advisory fees will reduce the contract value.
Market Value Adjustments (MVAs)
MVAs may apply to withdrawals during the initial option period in excess of 10% of the prior anniversary’s contract value (10% of purchase payments in the first year). There is no MVA assessed on allowable advisory fee withdrawals or withdrawals made after the initial option period has expired.
In addition, MVA will be waived for:
For more information about the MVA formula, please refer to the MVA endorsement detailed in the contract summary. View daily index yields for the J.P. Morgan 10-Year U.S. Liquid Index here.
Income Options
After the first contract year, clients may elect to receive income payments through fixed annuitization options.1 There are a variety of options available, including options that will guarantee income for two lives and options that will continue to make payments to a beneficiary after the death of the annuitant(s). Please see the contract for more information on electing to receive annuity income payments and the available annuity income options.
Annuity withdrawals are taxable as ordinary income when distributed and may be subject to a 10% additional tax if withdrawn before age 59½. For nonqualified contracts, an additional 3.8% federal tax may apply on net investment income. Withdrawals will reduce the contract value and the value of the death benefits.
1For qualified contracts, the maximum length of time for the Period Certain options may be less than 10 years, if necessary, to comply with required minimum distribution (RMD) regulations for annuities as well as provisions as a result of the Setting Every Community Up for Retirement Enhancement (SECURE) Act.
Pacific Advisory Fixed Indexed Annuity offers multiple ways to earn interest.
The Fixed Account option earns a fixed rate of interest, is guaranteed for one contract year, and is credited on a daily basis.
Index-linked options may earn interest based on positive movement of an index during the index term and are credited on an annual basis.
Clients can choose to allocate to any combination of the following:
Breakpoints
Breakpoints provide the potential to increase the interest earned on the contract value. There are two ways to qualify for a breakpoint:
Fee-Friendly
Regardless of the index-linked options chosen, the value used to calculate the index-linked interest (ILI) will not be reduced by allowable advisory fee1 withdrawals during the index term. So, unlike some other fixed indexed annuities, advisory fees will not negatively impact the ILI that may be credited for the contract year and will not create a taxable event.
1Allowable advisory fees are advisory fee withdrawals that do not exceed an annual rate of 1.50% of the contract value during the calendar year. Withdrawals from the contract to pay advisory fees will reduce the contract value.
Guaranteed rates and caps will never be set below the minimum or above the maximum stated in the contract. Pacific Life determines, at its discretion, guaranteed rates and caps in excess of the minimum or above the maximum guaranteed in the contract.
The indexes are not available for direct investment, and index performance does not include the reinvestment of dividends.
If death of the first owner or last annuitant occurs before annuity income payments begin, a death benefit is paid to clients' beneficiaries that equals the greater of 1) the contract value plus any pro-rata index-linked interest as of the notice date or 2) the guaranteed minimum withdrawal value.
Minimum Purchase Payment: $25,000 (qualified and nonqualified).
All cash payments and 1035 exchange/transfer requests must be submitted with the application. Subsequent payments up to $100,000 are permitted within the first 60 days after contract issue.
Maximum Annuitant/Owner Issue Age: 85
Maximum Annuitization Age: 100
Pacific Life, its distributors, and respective representatives do not provide tax, accounting, or legal advice. Any taxpayer should seek advice based on the taxpayer's particular circumstances from an independent tax advisor or attorney.
Pacific Life is a product provider. It is not a fiduciary and therefore does not give advice or make recommendations regarding insurance or investment products.
Fixed indexed annuities are not securities and do not participate directly in the stock market or any index, so they are not investments.
Under current law, a nonqualified annuity that is owned by an individual is generally entitled to tax deferral. IRAs and qualified plans—such as 401(k)s and 403(b)s—are already tax-deferred. Therefore, a deferred annuity should be used only to fund an IRA or qualified plan to benefit from the annuity’s features other than tax deferral. These features include lifetime income, death benefit options, and the ability to transfer among investment options without sales or withdrawal charges.
Annuities are long-term contracts designed for retirement. Annuity withdrawals and other distributions of taxable amounts, including death benefit payouts, will be subject to ordinary income tax. For nonqualified contracts, an additional 3.8% federal tax may apply on net investment income. If withdrawals and other distributions are taken prior to age 59½, an additional 10% federal income tax may apply. A withdrawal charge also may apply and a market value adjustment (MVA) also may apply. Withdrawals will reduce the contract value and the value of the death benefit, and also may reduce the value of any optional benefits.
Insurance product and rider guarantees, including optional benefits and any fixed crediting rates or annuity payout rates, are backed by the financial strength and claims-paying ability of the issuing insurance company and do not protect the value of the variable investment options. They are not backed by the broker-dealer from which this annuity is purchased, by the insurance agency from which this annuity is purchased, or any affiliates of those entities, and none makes any representations or guarantees regarding the claims-paying ability of the issuing insurance company.
The Product and its MSCI EAFE® Index-Linked Options referred to herein are not sponsored, endorsed, or promoted by MSCI, and MSCI bears no liability with respect to any such Products or any index on which such Products are based. The Policy Contract contains a more detailed description of the limited relationship MSCI has with Pacific Life Insurance Company and any related products.
The “S&P 500® index” is a product of S&P Dow Jones Indices LLC or its affiliates (“SPDJI”), and has been licensed for use by Pacific Life Insurance Company. Standard & Poor’s® and S&P® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). Pacific Life’s product is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500® index.
Pacific Advisory Fixed Indexed Annuity is named “Individual Limited Premium Deferred Fixed Annuity Contract with Indexed-Linked Interest Options" in the contract.
Annuity products are not FDIC insured, may lose value, and are not guaranteed by any bank.
Fixed annuity products issued by Pacific Life Insurance Company (Newport Beach, CA) are available through licensed, independent third parties.
Pacific Life Insurance Company is licensed to issue insurance products in all states except New York. Product/material availability and features may vary by state.
Contract Form Series: ICC20:30-1045, ICC20:30-1045-CS
Rider Series: ICC20:20-1047, ICC20:20-1046
Endorsements: ICC20:15-1407
State variations to contract form series, rider series, and endorsements may apply.
This material is intended for financial professional use only. If you are not a financial professional, please visit our public website at PacificLife.com
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