Prudential Financial, Inc. · NYSE:PRU
Prudential Financial — Investor Presentation (May 2007)
46 slides from Prudential Financial's investor presentation, May 15, 2007
Slide 1: 5 steps to help you toward a solid financial foundation
5 steps to help you toward a solid financial foundation yourRockforRetirement Presenter Name Presenter Function Month Day, Year INST-20070515-A023197
Slide 2: Rock solid: What would a secure retirement mean to you?
Rock solid What would a secure retirement mean to you?
Slide 3: Key questions we’ll begin to address today
Key questions we’ll begin to address today 5 How can I protect my future income? 4 How can I save more now? 3 Where will my income come from? 2 What will my health care expenses be? 1 What lifestyle do I want and how much will it cost?
Slide 4: The action plan we’ll build as we go
The action plan we’ll build as we go
Slide 5: What lifestyle do I want and how much will it cost?
Step 1 What lifestyle do I want and how much will it cost?
Slide 6: How will you spend your time?
1 How will you spend your time? Who will you spend it with?
Slide 7: Will you continue to work?
1 Will you continue to work? Will you start a new career? Open a new business?
Slide 8: Where will you live?
1 Where will you live? Will you sell your home? Buy a new one?
Slide 9: How much will that lifestyle cost to maintain?
1 How much will that lifestyle cost to maintain? “Must-have” expenses? “Nice-to have” expenses? healthcare memberships shopping entertainment housing tuition utilities second home transportation travel shopping housing entertainment second home tuition travel healthcare utilities memberships transpo
Slide 10: How much will that lifestyle cost to maintain?
1 How much will that lifestyle cost to maintain? “Must-have” expenses? “Nice-to have” expenses? healthcare memberships shopping entertainment shopping shopping entertainment housing tuition utilities second home travel transportation transportation travel
Slide 11: How much will that lifestyle cost to maintain?
1 How much will that lifestyle cost to maintain? There is no “rule of thumb.” How much income you need depends on what you plan to do.
Slide 12: How long will your money need to last?
1 How long will your money need to last? 50% 50% 25% 25% Source: National Center for Health Statistics, 2006
Slide 13: Your Planning Process
1 Your Planning Process • Think about how you want to spend your retirement. • Complete Section 1 of your worksheet. • Roughly estimate your income needs.
Slide 14: What will my health care expenses be?
Step 2 What will my health care expenses be?
Slide 15: Why single out health care expenses?
2 Why single out health care expenses? What percentage of their income do today’s retirees 22% of their income spend on health and climbing! care services and insurance? Source: International Longevity Center, NYC; AARP, 2006.
Slide 16: What can you do to control those expenses?
2 What can you do to control those expenses? • Eat aare What healthy somediet of the practical things • Exercise you could do now •toReduce minimize stress your health care • Stay mentally fit expenses? • Get regular checkups • Quit smoking
Slide 17: Why you can’t count only on Medicare.
2 Why you can’t count only on Medicare. 100% Medicare What percentage doesn’tof medical do it all.expenses do you think • begins at age 65 Medicare typically currently pays only •pays? 55% of retirees’ medical expenses. 50% Source: U.S. Government Accountability Office; Federal Trustees of the Medic
Slide 18: What you can do to fill the gap
2 What you can do to fill the gap 100% Research your health care options • Individual health insurance policy • Supplemental health insurance 50% • Long-term care insurance 0%
Slide 19: Why consider long-term care insurance
2 Why consider long-term care insurance • Turns an unpredictable cost into a covered expense • Can pay for home health care as well as nursing home care
Slide 20: How to make long-term care work for you
2 How to make long-term care work for you • Research. Is it right for your needs? • Compare. Which options are most suitable? • Act. The sooner you buy, the cheaper the cost.
Slide 21: Your Planning Process
2 Your Planning Process • Cultivate healthy habits now. • Explore your retiree health care options. • Consider purchasing long-term care insurance. • Complete Section 2 of your worksheet.
Slide 22: Where will my retirement income come from?
Step 3 Where will my retirement income come from?
Slide 23: Evaluate your possible sources of income
3 Pie graph Evaluate your possible sources of income Guaranteed Income Sources Social Security: the more you make, Pension Plans & the less it will replace Other: Social 21% Pensions: Security: available to fewer and fewer people From where 39% Savings & Investments: Savings: Or 40%more. may account
Slide 24: Inventory your own savings/investments
3 Inventory your own savings/investments Stocks/bonds Roth IRA Life insurance Savings/CDs Traditional IRA Municipal bonds Real estate 401(k), 403(b), 457 Annuity Income from part-time work, consulting, etc.
Slide 25: Inventory your own savings/investments
3 Inventory your own savings/investments Savings & Group by tax treatment: Investments 1. Taxable 2. Tax-Deferred 3. Tax-Free Stocks/bonds 401(k), 403(b), 457 Life insurance* Savings/CDs Traditional IRA Roth IRA Real estate Annuity Municipal bonds Income from part-time work, consulting, etc. *Cost B
Slide 26: Your Planning Process
3 Your Planning Process • Review your Social Security estimate. • Request a pension estimate from your benefits manager. • Inventory your resources. • Complete Section 3 of your worksheet.
Slide 27: How can I save more for my retirement?
Step 4 How can I save more for my retirement?
Slide 28: Consider increasing your plan contributions
4 C5 Consider increasing your plan contributions. More now can mean a lot more later. 5% 10% Joe Employee: • Age: 50 • Annual Salary: $40K • Plan Balance: $100K • Rate of Return: 5% 1 2 3 4 5 6 $253,431 $308,869 7 8 9 10 11 12 13 14 15 This compounding concept is hypothetical and for illustrative pu
Slide 29: Already maxing out your retirement plan?
4 Roth Already maxing out your retirement plan? Already maxing out your retirement plan? Consider contributing to a Traditional or Roth IRA. 10% Jane Employee: • Age: 50 • Opening deposit: $5K • Rate of Return: 5% 1 2 3 4 5 6 $113,287 7 8 9 10 11 12 13 14 15 This compounding concept is hypothetical
Slide 30: Your Planning Process
4 Your Planning Process • Consider increasing your retirement plan contributions. • Complete Section 4 of your worksheet. • Trade a few “nice-to-haves” now for more “nice-to-haves” later.
Slide 31: How can I protect my future income?
Step 5 How can I protect my future income?
Slide 32: Protecting your income is a balancing act
5 Protecting your income is a balancing act. How much you earn on your investments BALANCE How much you withdraw for income
Slide 33: Don’t invest too conservatively, too soon
5 Don’t invest too conservatively, too soon If your income doesn’t keep pace with inflation, you may have to live on less. Growth of income Rate of inflation
Slide 34: Don’t invest too aggressively, too late
5 Don’t invest too aggressively, too late If market losses drive down your account value, you may have to live on less. Would you rather retire here? Or here?
Slide 35: Don’t withdraw too much, too fast
5 W Don’t withdraw too much, too fast Don’t withdraw too much, too fast What % of your savings do you think you can withdraw each year? 15% 10% 8% 4% Years 1 25 For illustrative purposes only.
Slide 36: Don’t withdraw too much, too fast
5 Don’t withdraw too much, too fast W15 What % of your savings do you think you can If you withdraw at that rate, here’s when you’re withdraw each year? likely to run out of money… 15% 10% 8% 4% Years 1 25 ³Assumes a 5% fixed withdrawal amount each year, based on the initial For illustrative purpose
Slide 37: Don’t withdraw too much, too fast
5 Don’t withdraw too much, too fast W10 What % of your savings do you think you can If you withdraw at that rate, here’s when you’re withdraw each year? likely to run out of money… 15% 10% 8% 4% Years 1 25 ³Assumes a 5% fixed withdrawal amount each year, based on the initial For illustrative purpose
Slide 38: Don’t withdraw too much, too fast
5 Don’t withdraw too much, too fast W8 What % of your savings do you think you can If you withdraw at that rate, here’s when you’re withdraw each year? likely to run out of money… 15% 10% 8% 4% Years 1 25 ³Assumes a 5% fixed withdrawal amount each year, based on the initial For illustrative purposes
Slide 39: Don’t withdraw too much, too fast
5 Don’t withdraw too much, too fast W4 What % of your savings do you think you can If you withdraw at that rate, here’s when you’re withdraw each year? likely to run out of money… 15% 10% Years 8% 4% 1 25 ³Assumes a 5% fixed withdrawal amount each year, based on the initial For illustrative purposes
Slide 40: Ensure your “must-have” expenses are covered
5 IFLX Ensure your “must-have” expenses are covered Ensure your “must-have” expenses are covered Estimate your “must-have” expenses Identify Cover anyguaranteed with gap in guaranteed income income sources
Slide 41: Consider ways to bridge your income
5 IFLX Consider ways to bridge your income Consider ways to bridge your income To create a reliable income stream, Guaranteed Income Sources consider using a portion of your savings to: (Non-guaranteed Income Sources) Pension Plans & 1. Invest in CDs or bonds with sequential Other Social Security ma
Slide 42: Ask about your plan’s income protection
5 Ask about your plan’s income protection. W4 Ask about your plan’s income protection. If you’re age 50+, consider the Prudential IncomeFlexSM option: • lets you stay invested and capture upswings • guarantees future income will grow at least 5% now • guarantees your income will never run out later
Slide 43: About Prudential IncomeFlex
5 About Prudential IncomeFlexSM SM W4 Prudential IncomeFlexSM funds are separate accounts available under group variable annuity contracts issued by Prudential Retirement Insurance and Annuity Company (PRIAC). PRIAC does not provide any guarantee of the investment performance or return of contributi
Slide 44: Your Planning Process
5 Your Planning Process • Review your investment strategy. • Plan your withdrawal strategy. • Learn more about how your plan can protect you.
Slide 45: Today is just the beginning.
Today is just the beginning. Speak with a Prudential Retirement Counselor at 4 1-800-992-4472 Visit our retirement Web site 3 at prudential.com/retireready Be part of future Prudential 2 retirement financial seminars Take action on what we’ve 1 covered
Slide 46: 5 steps to help you toward a solid financial foundation
5 steps to help you toward a solid financial foundation yourRockforRetirement Prudential Retirement, Prudential Financial, PRU, Prudential and the Rock logo are registered service marks of the Prudential Insurance Company of America, Newark, NJ and its affiliates. Prudential Retirements is a Prudent
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