Following the recent IRS Private Letter Ruling allowing favorable tax treatment of advisory fees from non-qualified annuities, Nationwide Advisory Solutions continues to optimize its retirement income solutions built expressly to fit the way RIAs and fee-based advisors work, launching a new lifetime income rider and two new enhancements to Nationwide Advisory Retirement Income Annuity (NARIA).
A simple, transparent, low-costi variable annuity (VA) and one of the only VAs with "advisory friendly" fee-management capabilities that will not erode the client's benefit baseii, NARIA can help RIAs and fee-based advisors incorporate insurance into their practice for more holistic planning.
NARIA now offers Nationwide Lifetime Income Rider® Advisory (Nationwide L.inc℠ Advisory), a new optional living benefit with a 7% interest roll-upiii—one of the highest in the industry—to guarantee lifetime income that will never decrease and that clients can never outlive, even if their contract value falls to zero.iv
Nationwide L.inc Advisory can provide a balance between growth potential and income protection with a competitive increase of at least 7% simple interest on the client's income benefit basev every year during the accumulation phase on the rider anniversary, even when the market is flat or down. When the client's contract returns above 7% on the rider anniversary, the contract value is the benefit base.
Nationwide L.inc Advisory is designed to help RIAs and fee-based advisors provide a retirement income solution compatible for a shorter accumulation period, which is important during those critical years between the ages of 65 to 75, when most clients start taking retirement income and need income protection.
"The retirement income challenge is real and growing, and research shows that allocating a portion of the portfolio to guaranteed income improves client outcomes. The challenge for RIAs and fee-based advisors is finding insurance and annuities that are built to fit the way they work," said Craig Hawley, head of Nationwide Advisory Solutions. "More companies continue to claim they offer insurance solutions for RIAs and fee-based advisors, but none have our proven 10-year track record of innovating products, integrating them into advisors' workstations, and removing friction points around fee-management and licensing. By serving more than 5,500 RIAs and fee-based advisors for more than a decade, and helping them create more value for their clients, we have become a dominant player."
In an important new enhancement, NARIA can now offer unconstrained 100% equity exposure when combined with Retirement Income DeveloperSM (RIDER), a lower cost optional living benefitvi launched earlier this year. RIDER also includes a potential step-up feature that gives clients the ability to participate in market growth while protecting income from possible market losses. RIDER is designed for longer accumulation periods, with newly increased equity exposure providing an even greater investment flexibility to proactively manage through various market cycles.
In another new enhancement, NARIA now offers tiered pricing for its low-cost platform funds. More than 30 funds, including investment options from DFA, DoubleLine, Vanguard and Nationwide, are now available for competitive cost of 10 bps – 35 bps, in addition to NARIA's M&E of 20 bps. In total, NARIA offers more than 150 underlying funds from more than 25 fund families, provides more choice and greater investing flexibility than the majority of traditional VAs with living benefits.vii
Nationwide Advisory Solutions is committed to helping RIAs and fee-based advisors incorporate insurance into the holistic planning process, by eliminating key friction points for advisors while creating greater value for clients. Nationwide Advisory Solutions offers a licensed insurance agent concierge at no additional cost for RIAs who don't hold an insurance license. They launched Nationwide Advisory Income℠, the industry's first single premium immediate annuity (SPIA) for RIAs and fee-based advisors, and pioneered Monument Advisor, the industry's firstviii Flat-Feeix Investment-Only Variable Annuity (IOVA).
Nationwide Advisory Solutions has also developed an innovative end-to-end process adopted by more than 5,500 RIAs and fee-based advisors for more holistic planning, including an online application, web-enabled account management, and comprehensive integration capabilities with more than 95% of all fee-based advisory platforms and technologies. Nationwide Advisory Solutions' award-winning advisor experiencex is built using advanced analytics and artificial intelligence, based on more than a decade of expertise in meeting the unique needs of RIAs and fee-based advisors.
About Nationwide Advisory Solutions
Nationwide Advisory Solutions is a recognized innovator with a mission to help RIAs and fee-based advisors build their practice by helping their clients to potentially accumulate more wealth and reach their financial goals. It does this by developing and delivering value-added investment products, services and technologies that dovetail with fiduciary obligations—wrapped in an industry-leading customer experience.x To learn more, please visit www.nationwideadvisory.com
Nationwide, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the United States. Nationwide is rated A+ by both A.M. Best and Standard & Poor's. An industry leader in driving customer-focused innovation, Nationwide provides a full range of insurance and financial services products including auto, business, homeowners, farm and life insurance; public and private sector retirement plans, annuities and mutual funds; excess & surplus, specialty and surety; pet, motorcycle and boat insurance. For more information, visit www.nationwide.com. Follow us on Facebook and Twitter.
i 0.20% annually (0.15% mortality and expense charge; 0.05% administrative charge)
ii Each adjustment for amounts subsequently surrendered will reduce the living benefit in the same proportion the contract value was reduced on the date of the partial surrender.
iii This is not an increase of the actual contract value, but is an increase of the original benefit base.
iv All guarantees are subject to rider terms and conditions. If clients take early, excess withdrawals, excess advisory fees, or non-lifetime withdrawals, especially in a down market, loss of income is a possibility. Fees are assessed annually on the income benefit base. Maximum Cost is 1.50% for Nationwide L.inc Advisory and an additional 0.40% for Nationwide L.inc Advisory with the Joint Option.
v The income benefit base is a numerical value used to determine lifetime withdrawals. This is not a cash value. The calculation may be adjusted for additional purchase payments, excess or non-lifetime withdrawals and the annual step-up opportunity. Refer to the prospectus for more information.
vi Additional fees apply. See the prospectus for details.
vii Morningstar Data as of 03/01/19.
viii Mogel, Gary S. (2005, June 6), Flat-fee variable annuity makes its debut. Investment News. Retrieved from http://www.investmentnews.com/article/20050606/SUB/506060708
ix Jefferson National's Monument Advisor has a $20 monthly flat insurance fee. Additional low-cost fund platform fees ranging from .10% - .35% will be assessed for investors wishing to purchase shares of low-cost funds. See the prospectus for details.
x 2018 WealthManagement.com Innovation Award.
Not a deposit. Not FDIC or NCUSIF insured. Not guaranteed by the institution. Not insured by any federal government agency. May lose value.
All guarantees and protections are subject to the claims paying ability of the issuing company.
An investor should carefully consider the investment objectives, risks, charges and expenses of the investment before investing or sending money. For a prospectus and underlying fund prospectuses containing this and additional information, please contact your financial professional or visit www.nationwideadvisory.com. Read it carefully before investing. The summary of product features is not intended to be all-inclusive. Restrictions may apply. The contracts have exclusions and limitations, and may not be available in all states or at all times.
Variable annuities are investments subject to market fluctuation and risk, including possible loss of principal. Your units, when you make a withdrawal or surrender, may be worth more or less than your original investment.
Variable annuities are long-term investments to help you meet retirement and other long-range goals. Withdrawals of tax-deferred accumulations are subject to ordinary income tax. Withdrawals made prior to age 59½ may incur a 10% IRS tax penalty. Nationwide does not offer tax advice.
Nationwide Advisory Retirement Income Annuity is a variable annuity issued by Nationwide Life Insurance Company, Columbus, Ohio. The general distributor is Nationwide Investment Services Corporation, member FINRA. Products might not be available in all states or territories.
Nationwide Advisory Income is issued by Nationwide Life Insurance Company, Columbus, Ohio.
Monument Advisor is issued in all states, except NY, by Jefferson National Life Insurance Company (Louisville, KY). In New York, Monument Advisor is issued by Jefferson National Life Insurance Company of New York (New York, NY). The general distributor is Jefferson National Securities Corporation, FINRA member. All companies are affiliates of Nationwide Life Insurance Company.
Nationwide, the Nationwide N and Eagle, Nationwide is on your side, Nationwide Advisory Retirement Income Annuity, NARIA, Nationwide Lifetime Income Rider, Nationwide L.inc, and Retirement Income Developer are service marks of Nationwide Mutual Insurance Company. © 2019 Nationwide.