Retirement Tips from Robert Fishbein

Learn helpful retirement planning tips from Robert Fishbein, vice president and corporate counsel in Prudential Financial’s Tax Department.

> Maximize Your Social Security Benefits
If you collect Social Security at age 62, your benefits will be just 75 percent of what you’d collect at full retirement age. Should you wait till full retirement age? The answer depends on whether you can live adequately in retirement without the benefit.

For individuals in poor health or with clear indicators of diminished life expectancy, it might make sense to take reduced benefit payments at 62. For people who are considering taking the benefit early because they’re worried that their savings will not be sufficient to cover their living expenses, there are alternatives that could help them push off collecting—and therefore enhance—their Social Security benefits.

One approach is to use some savings to buy an immediate annuity that would cover you until you can collect the higher Social Security benefits. Another is to start withdrawing money from an IRA if you have one.

> Look for Sources of Guaranteed Retirement Income
As life spans increase, you can expect to live 20 or 30 or more years in retirement. And if you’re expecting to retire within the next five years or you’re already in the first five years of retirement, you’re living in "The Retirement Red Zone."

During this time, even short-term losses in your retirement accounts can have long-term devastating effects on your future income. The Retirement Red Zone is the time to preserve your retirement savings so they last your lifetime.

Having enough sources of reliable retirement income is the critical solution for many retirees. Current retirees and those retiring in the future will most likely not have guaranteed lifetime income from defined benefit plans like pensions. Also, they may have reduced Social Security benefits. Individuals can manage the risk of outliving their assets by ensuring they have an appropriate amount of guaranteed lifetime income.

A "modern" annuity is one way to fill this void. This new type of annuity allows you to retain control over your assets while guaranteeing an income that will last your lifetime.

Learn more about The Retirement Red Zone.

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Investors should consider the contract and the underlying portfolios' investment objectives, risks, charges and expenses carefully before investing. This and other important information is contained in the prospectuses, which can be obtained by contacting your financial professional. Please read the prospectuses carefully before investing.

Variable annuities are for retirement purposes and appropriate for long-term investing and are subject to market fluctuation, investment risk and possible loss of principal.

A variable annuity is a contract with an insurance company whereby the insurer agrees to make periodic payments beginning either immediately or at some future date. Variable Annuities offer a wide range of professionally managed investment options, guaranteed death benefits, and a variety of payout options including guaranteed income for life. It's important to note the annuity's contract value is subject to market fluctuation, investment risk, and possible loss of principal. They have fees and expenses. If your clients take early withdrawals, they may be subject to surrender charges. Partial or complete withdrawals of taxable amounts will be subject to ordinary income tax and, if prior to age 59 ½, may result in an additional 10% federal income tax penalty. Withdrawals from an annuity generally have the effect of reducing the death benefit and cash surrender value. There are fees associated with optional benefits, which are in addition to fees and charges associated with the basic annuity. See the prospectus for more detailed information about fees and limitations.

Payments of guaranteed principal and income, as well as living and death benefit guarantees, are contingent upon the claims-paying ability of the issuing company. Guarantees do not apply to the investment performance or safety of the underlying subaccounts in the variable annuity. Optional living and death benefits are available for an additional fee and may not be available in all states.

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IFS-A152867 Ed. 08/2008