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Accumulation Phase – This first phase represents the beginning of your retirement income through Great-West SecureFoundation® guarantee. In this phase, you may actively contribute to your Great-West SecureFoundation® fund(s) to establish and subsequently increase your Benefit Base. The Accumulation Phase begins either immediately (for the Great-West SecureFoundation® Balanced Fund and the Great-West SecureFoundation® Lifetime 2015 and 2020 Portfolios) or 10 years before the target date (for the other Great-West SecureFoundation® Lifetime Funds). This phase ends with your first Guaranteed Annual Withdrawal payment.
Beneficiary – This person receives the assets after the death of the account owner. If a Great-West SecureFoundation account owner who elected a single life distribution dies during the Guaranteed Annual Withdrawal Phase, Great-West SecureFoundation will terminate immediately and the remaining Fund Value will be distributed to the owner's beneficiary. The beneficiary may elect to establish his or her own Benefit Base at that time. If the Great-West SecureFoundation account owner elected joint life distributions, the beneficiary may keep the account in the survivor/beneficiary's name, maintain the established Benefit Base, and continue to receive the established Guaranteed Annual Withdrawals. See the certificate and product prospectus for more information.
Benefit Base – Your Benefit Base represents the "high point" of your savings. It is used to calculate guaranteed lifetime payments, has no monetary value, and is different from your Fund Value. Your Benefit Base is established when you enter the Accumulation Phase or with the first Contribution or rollover that triggers Great-West SecureFoundation guarantee. Each Great-West SecureFoundation fund has its own Benefit Base. Your Benefit Base cannot be transferred between Great-West SecureFoundation funds.
Contributions – These are account owner-directed investments into the Great-West SecureFoundation fund(s), including rollovers and transfers. Contributions into your Great-West SecureFoundation fund(s) are accepted during the Accumulation Phase only. All Contributions increase your Benefit Base dollar-for-dollar at the time of investment. A 90-day transfer-in restriction applies after any transfer out. Reinvested dividends, capital gains and settlements arising from the Great-West SecureFoundation fund(s) are not considered Contributions.
• During your Accumulation Phase, this term refers to any amount distributed or transferred from your Great-West SecureFoundation fund(s).1
• During your Guaranteed Annual Withdrawal Phase, this term refers to any amount distributed or transfered from your Great-West SecureFoundation funds combined with all other amounts that, in total, exceed your Guaranteed Annual Withdrawal.
Excess withdrawals reduce your Benefit Base proportionately and affect your Great-West SecureFoundation guarantee.
Fund Value – This is the value of each of the Great-West SecureFoundation fund(s) held in your account, and it will fluctuate with market conditions, dividends, capital gains, your contributions and withdrawals.
Guarantee Benefit Fee – This is the amount Great-West charges for the guarantee of retirement income for life. Currently the annual fee is 0.9% of your Fund Value; however, it can range from 0.7% to 1.5%. Great-West has the right to change this fee at any time with a 30-day written notice. The dollar amount of this fee will fluctuate depending upon your Fund Value and is paid through redemption of Great-West SecureFoundation fund(s) shares. When you enter the Settlement Phase, this fee will not apply. For more information, please see the Great-West SecureFoundation prospectus.
Guarantee Trigger Date – Your Great-West SecureFoundation guarantee begins on this date. As noted under Investment Options, with the Great-West SecureFoundation® Balanced Fund and Great-West SecureFoundation® Lifetime 2015 and 2020 Portfolios, the Guarantee Trigger Date occurs immediately. With the other Great-West SecureFoundation® Lifetime Funds, the Guarantee Trigger Date is 10 years before the fund's targeted maturity.
Guaranteed Annual Withdrawal – This is your annualized withdrawal amount that's guaranteed for your lifetime or for the lifetime of you and your spouse, if you elect a joint withdrawal. At first, withdrawals are made from your Fund Value. If you exhaust your Fund Value (see Settlement Phase), Great-West SecureFoundation continues to provide you with retirement income in the same amount for life. Your Guaranteed Annual Withdrawal is based on a percentage of your Benefit Base according to the following schedule and is locked in based on your age (or if you elect joint withdrawals, the age of the younger of you or your spouse). There is a risk that you might not begin taking your Guaranteed Annual Withdrawal at the most financially beneficial time. There is also a risk that you may not live long enough to receive payments that reduce the Great-West SecureFoundation fund(s) Fund Value to zero or that you may not live long enough to receive enough income to exceed the amount paid for the Guarantee Benefit Fee. Consult your financial advisor on whether Great-West SecureFoundation is right for you.
|4.0% for life at ages 55-64||3.50% for youngest joint life at 55-64|
|5.0% for life at ages 65-69||
4.50% for youngest joint life at 65-69
|6.0% for life at ages 70-79||5.50% for youngest joint life at 70-79|
|7.0% for life at ages 80+||
6.50% for youngest joint life at 80+
Guaranteed Annual Withdrawal Phase – This second phase begins with your election to receive your first Guaranteed Annual Withdrawal payment. At that time, you will elect either a single or joint withdrawal benefit that will determine your Guaranteed Annual Withdrawal amount, which is a percentage of your Benefit Base. During this phase, you will receive your Guaranteed Annual Withdrawal benefit from your Great-West SecureFoundation® Fund Value.
Investment Options – Your Empower Retirement IRA includes the following Great-West SecureFoundation funds. Each fund includes the purchase and acceptance of Great-West SecureFoundation.
Great-West SecureFoundation® Lifetime Funds3 – These target date funds are a mix of investments in underlying mutual funds that are designed to meet certain investment goals based on an IRA holder's investment horizon (such as projected retirement date and personal objectives). Depending on its proximity to the year designated in the name of the Great-West SecureFoundation Lifetime Portfolio, each fund employs a different combination of investments among the underlying funds in order to emphasize, as appropriate, growth, income and/or preservation of capital, gradually shifting its emphasis from more aggressive investments to more conservative ones based on its target date. The date in the Great-West SecureFoundation® Lifetime Funds represents the approximate date when the investor would expect to start taking withdrawals.
These funds include a fund management fee of between 0.92% and 1.00% of the Fund Value. The Fund Value is not guaranteed at any time, including the target date. Ten years before the date named in the fund (Guarantee Trigger Date), the Great-West SecureFoundation guarantee (Guarantee) and Benefit Base begin. At that time, the mix of investments shifts to an appropriate allocation of approximately 60% equities and 40% bonds and cash equivalents. Additionally, at the Guarantee Trigger Date, these portfolios will include an annual Guarantee Benefit Fee of 0.9% of your Fund Value, which is the amount Great-West charges for the guarantee of retirement income for life. The annual Guarantee Benefit Fee can range from 0.7% to 1.5%, and Great-West may change the fee at any time with a 30-day written notice. For more information, please refer to the fund and/or product prospectus.
Great-West SecureFoundation® Balanced Fund4 – This fund includes a mix of investments in other underlying funds with approximately 60% equities and 40% bonds and cash equivalents. With the first contribution into the fund, 100% of the account holder's Fund Value establishes the Benefit Base. This fund includes a fund management fee of 0.93% of your Fund Value. This fund also includes an annual Guarantee Benefit Fee of 0.9% of your Fund Value, which is the amount Great-West charges for the guarantee of retirement income for life. The annual Guarantee Benefit Fee can range from 0.7% to 1.5%, and Great-West may change the fee at any time with a 30-day written notice. For more information, please refer to the fund and/or product prospectus.
Ratchet – An increase in the Benefit Base that occurs if the Fund Value in the Great-West SecureFoundation fund exceeds the current Benefit Base on the annual Ratchet Date.
Ratchet Date – On your annual Ratchet Date, your Benefit Base will increase, or "ratchet up," if your Fund Value exceeds your current Benefit Base in order to capture positive market performance. On the other hand, your Benefit Base won't decrease if your Fund Value is less than your Benefit Base on the Ratchet Date.
Settlement Phase – This final phase is the period when your Great-West SecureFoundation® Fund Value has reached zero, and you retain a Benefit Base. Your Guaranteed Annual Withdrawals will continue per the terms of your insurance certificate and the product prospectus.
Target Date Fund – A target date fund is a mutual fund that adjusts the mix of stocks, bonds, and cash equivalents in the portfolio to move from more aggressive investments to more conservative ones as it nears the date in the name of the fund. Investments in a target date fund are subject to the risks of the underlying funds. The principal value of a target date fund is not guaranteed at any time, including the target date.
Taxation – All of your withdrawals are subject to the same taxation considerations as any other IRA or Roth IRA withdrawals (whichever is applicable), including early withdrawal penalties.
Termination – A full withdrawal of the Great-West SecureFoundation® Fund Value other than the Guaranteed Annual Withdrawal will result in an automatic cancellation of Great-West SecureFoundation® guarantee. A termination would also occur if you select a new IRA provider to replace the Empower Retirement IRA.
Please consult with your financial advisor, call (877) 804-6257 to speak to a retirement associate, or
email us at RetirementSolutionsCenter@empower-retirement.com.*
1 The Guarantee Benefit Fee is not treated as a distribution or an Excess Withdrawal.
2 In some states, Great-West SecureFoundation guarantee is an insurance contract. This product may not be available in all states.
3 Investments in target date funds are subject to the risks of their underlying funds. For more information, please refer to the fund prospectus.
4 Balanced funds many invest in stocks and bonds. Stock values fluctuate in response to the activities of the general market, individual companies and economic conditions. Bond values fluctuate in response to the financial condition of individual issuers, general market and economic conditions and changes in interest rates. In general, when interest rates rise, bond values fall and investors may lose principal value. For more information, please refer to the fund prospectus.
* Representatives of GWFS Equities, Inc. are not registered investment advisers, and cannot offer financial, legal or tax advice. Please consult with your financial planner, attorney and/or tax adviser as needed.