Winning in the
“Second Half ”
106748NLB 10/04/10
“Setting a goal is not the
main thing. It is deciding
how you will go about
achieving it and staying
with that plan.”
– TOM LANDRY
Dallas Cowboys coach, 1960–1988
[ 1.1 ]
[2]
106748NLB 10/04/10
Primary Concerns
When you think about your financial security during retirement,
which of the following are you most worried about?
45%
How will I handle
unexpected medical
expenses?
38%
17%
Medical expenses Outliving savings,
Lack of personal
not covered by
lack of social
savings
insurance
security and pension
Source: AgeWave/Harris Interactive Survey, 2010
[ 2.1 ]
Will I have enough
income to sustain
my lifestyle in
the future?
People are living longer
Average life expectancies continue to improve
22
Roman Empire
33
Middle Ages
Source: Population Reference Bureau, 2009 World Population Data Sheet, 2009.
[ 2.2 ]
68
78
Years
years
1950
2009 (U.S.)
47
1900
[4]
106748NLB 10/04/10
Extended healthcare is a reality
People over 65
who will require
long term care
Average length of
majority of long
term care claims
2 3
3.8
out
of
people
1
years
2
Average life
expectancy after
Alzheimer's diagnosis
after age 70
4-7
1 Source: U.S. Department of Health and Human Services National Clearinghouse for Long Term Care Information website, May 2010
2 Source: Genworth Financial Claims Data, December 2009
3 Source: National Institute on Aging, National Institute of Health, 2/09
[ 4.1 ]
years
3
Extended healthcare is expensive today…
Cost of care for one year in the United States
In-home care:
$43,472
(44 hours/week)
Assisted living: $38,220
Nursing home:
(private room)
$75,190
Source: Genworth 2010 Cost of Care Survey, conducted by CareScout ®, April 2010. Based on national median costs
[ 4.2 ]
...and even more expensive
15 years from now
Future cost of care for one year in the United States*
$43,472
$90,375
Assisted living: $38,220
$79,457
In-home care:
(44 hours/week)
Nursing
home:
(private room)
$75,190
$156,315
Source: Genworth 2010 Cost of Care Survey, conducted by CareScout ®, April 2010. Based on national median costs.
* Estimates how much care might cost based on 5% annual inflation.
[ 4.3 ]
Your options
Avoid
Risk
[ 4.4 ]
AVOID
ASSUME
People over 65
who will require
long term care
2 3
out
of
people
TRANSFER
Your options
Assume
Risk
[ 4.5 ]
AVOID
Property
ASSUME
Managed
Money
Bonds
Money
Market
Stocks
TRANSFER
Can your portfolio sustain
unexpected expenses?
AVOID
Market provides
average 5% annual
returns over a 30 year
period except for years
4 through 7, when
returns fell to 2%
Retire with
a $2 million
portfolio
$3,000,000
ASSUME
TRANSFER
After 30 years,
you have $1.9
million
$2,000,000
$1,000,000
$2M retirement account, with hypothetical market
performance over a 30 year span, $100k withdrawn annually
Retirement
account value
$0
1
2
3
4 5
6
7
8
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31
This graph is hypothetical for illustrative purposes only and does not represent past or future performance
of any investment.
This example does not include investment expenses or taxes on money received, which would reduce the
amount of money received each year. Withdrawals may be subject to taxes and/or penalty fees imposed
by certain investments.
[ 4.6 ]
Assumptions:
-$2M portfolio at beginning of retirement
-$100,000 (5%) withdrawn annually, increased by 3% annually for inflation
-Poor market performance early in retirement
-Market performance shown is reverse order of S&P 500 returns from 2009 - 1979
Can your portfolio sustain
unexpected expenses?
Retire with
a $2 million
portfolio
AVOID
Major illness in Year
15 requires 4 years of
extended care
$3,000,000
ASSUME
TRANSFER
Retirement account
is unable to recover
from extended care
costs and is depleted
Year 1: 44 hours/week of home care $90,375
Year 2: 88 hours/week of home care $189,788
Year 3: 24-hour/day home care $380,438
Year 4: Private room in nursing home: $180,954
For a total cost of $841,000
$2,000,000
$1,000,000
$2M retirement account, with hypothetical market
performance over a 30 year span, $100k withdrawn annually
$0
1
2
3
4 5
6
7
8
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31
This graph is hypothetical for illustrative purposes only and does not represent past or future performance
of any investment.
This example does not include investment expenses or taxes on money received, which would reduce the
amount of money received each year. Withdrawals may be subject to taxes and/or penalty fees imposed
by certain investments.
[ 4.7 ]
Assumptions:
-$2M portfolio at beginning of retirement
-$100,000 (5%) withdrawn annually, increased by 3% annually for inflation
-Poor market performance early in retirement
-Market performance shown is reverse order of S&P 500 returns from 2009 - 1979
Your options
Transfer
Risk
[ 4.8 ]
AVOID
Traditional Long
Term Care Insurance
A percentage of your
portfolio can pay premium
Business owners can
deduct premiums
ASSUME
TRANSFER
Planning now can help you win in the second half
Have the conversation
[ 4.9 ]
1
What’s your
written strategy?
2
How will the costs
of extended care
impact your portfolio
and your family?
Talk with your financial professional about
strategies for long term care
[ 5.10 ]
Insurance underwritten by Genworth Life Insurance Company, and in New York, Genworth
Life Insurance Company of New York. Administrative offices: Richmond VA
Genworth Financial, its affiliates and representatives, do not provide tax advice. You should
consult a legal and/or tax professional for information relating to your particular situation
Genworth, Genworth Financial and the Genworth logo are registered service marks of
Genworth Financial Inc.
All guarantees are based on the claims-paying ability of the issuing insurance company.
www.genworth.com
© 2010 Genworth Financial, Inc. All rights reserved