METLIFE AND PIMCO COLLABORATE TO PROVIDE FINANCIAL ADVISORS WITH UNIQUE RETIREMENT INCOME SOLUTION
- MetLife’s Longevity Income Guarantee Complements PIMCO’s Real Income Funds to Provide Income Payments for Life -
NEW YORK, NY - March 1, 2011 - MetLife, Inc. (NYSE: MET), a leading global provider of insurance, employee benefits and financial services, and PIMCO, a global investment solutions provider, announced today an innovative marketing collaboration intended to educate advisors about a unique retirement income solution that combines investment and insurance products to help meet income planning needs over the course of a client’s retirement years.
Financial advisors today are challenged to solve two key risks that their clients may face during retirement: losing the purchasing power of income payments due to inflation and running out of money. To address these concerns, advisors can now offer clients a retirement income solution that uses two separate products in a complementary way. A client can purchase PIMCO mutual funds designed to provide systematic real (inflation-adjusted) monthly distributions to help protect against inflation risk, and separately purchase MetLife longevity insurance to provide monthly lifetime income after mutual fund distributions end.
“Inflation is a significant risk for retirees, and the PIMCO Real Income Funds are specifically designed to provide systematic monthly distributions for a specified term, while seeking to preserve retirees’ purchasing power ,” said Tom Streiff, Executive Vice President, PIMCO Retirement Product Manager. “Should they reach the end of these distributions, clients still need a retirement income stream that lasts for their rest of their lives.”
“Longevity insurance can protect retirees from the risk of outliving their assets while in retirement by providing guaranteed future lifetime income” said Elizabeth M. Forget, senior vice president, Retirement Products, MetLife. “By including MetLife’s Longevity Income Guarantee in a client’s overall retirement income strategy, a client can secure a guaranteed stream of lifetime income – typically beginning between ages 75-85 – when other assets may be running low.”
For example, a client entering retirement could invest a portion of his or her retirement savings in the PIMCO Real Income 2019 or 2029 Fund -- both liquid, open-end mutual funds investing primarily in U.S. Treasury Inflation-Protected Securities (TIPS) and designed to provide a systematic income stream of inflation-adjusted distributions for a defined period. The client can then also purchase separately the MetLife Longevity Income Guarantee (LIG), a deferred income annuity, also known as longevity insurance, designed to help a client maximize, protect and guarantee income later in his or her retirement years. MetLife was the first to market with its longevity insurance product in 2004.
The PIMCO inflation-adjusted mutual funds seek to continually maintain purchasing power during the applicable and defined distribution period. The fund distributions are made monthly until all assets have been distributed, either by October 2019 or October 2029 and depending on the fund selected by the client. The MetLife LIG can then generate income later in life, at a time when all assets from the PIMCO funds have been distributed. Clients can begin to take income from an LIG contract after a minimum two-year waiting period, starting any time between age 50 to 85.
MetLife LIG and the PIMCO Real Income Funds provide advisors with the tools to offer their clients a holistic retirement income solution.
MetLife is a subsidiary of MetLife, Inc. (NYSE: MET), a leading global provider of insurance, annuities and employee benefit programs, serving 90 million customers in over 60 countries. Through its subsidiaries and affiliates, MetLife holds leading market positions in the United States, Japan, Latin America, Asia Pacific, Europe and the Middle East. For more information, visit www.metlife.com.
PIMCO is a leading global investment management firm, with offices in 10 countries throughout North America, Europe and Asia. Founded in 1971, PIMCO offers a wide range of innovative solutions to help millions of investors worldwide meet their needs. PIMCO’s goal is to provide attractive returns while maintaining a strong culture of risk management and long-term discipline.
About PIMCO Real Income Funds
The PIMCO Real Income Funds are registered mutual funds. Investors should consider the investment objectives, risks, charges and expenses of the funds carefully before investing. This and other information are contained in the fund’s prospectus and summary prospectus, if available, which may be obtained by visiting www.pimco-funds.com. Please read them carefully before you invest or send money. Fund distributions are not guaranteed and are made until their stated maturity dates rather than for life. During periods of rising inflation the amount of the monthly distribution by the Funds is expected to increase and during periods of deflation the amount of the monthly distribution is expected to decrease. The monthly distribution amount may be adjusted during the term of a Fund to better enable the Fund to provide regular monthly distributions through the final maturity date.
Fixed-income investments are subject to interest rate risk; their value will normally decline as interest rates rise. Each PIMCO Real Income Fund seeks to achieve its investment objective by investing under normal circumstances at least 90% of its net assets in inflation-indexed bonds issued by the U.S. Treasury. Each PIMCO Real Income Fund may also invest in other securities issued by the U.S. Treasury, futures contracts on U.S. Treasury securities, and high credit quality money market instruments. Inflation-indexed bonds are fixed income securities that are structured to provide protection against inflation. Each PIMCO Real Income Fund is non-diversified, which means that it may invest its assets in a smaller number of issuers than a diversified fund. Each PIMCO Real Income Fund may use derivative instruments for hedging purposes or as part of its investment strategy. Use of these instruments may involve certain costs and risks. Investments in derivatives could lose more than the principal amount invested in those instruments.
Guarantees apply to certain insurance and annuity products, including optional benefits (not securities, variable or investment advisory products) and are subject to product terms, exclusions and limitations and the issuing MetLife company’s claims-paying ability and financial strength.
MetLife fixed annuities, like all annuities, are insurance products and are not insured by the FDIC, the NCUSIF or any other government agency, nor are they guaranteed by, or the obligation of, the financial institution that sells them. All product guarantees are made solely by the issuing insurance company. The payment of principal and interest, therefore, depends solely on the issuing MetLife company’s claims-paying ability and financial strength.
Pursuant to IRS Circular 230, you are being provided with the following notification: The information contained in this document is not intended to (and cannot) be used by anyone to avoid IRS penalties. You should seek advice based on your particular circumstances from an independent tax advisor.
Legal or tax advice is not being given. Any discussion of taxes herein or related to this document is for general information purposes only and does not purport to be complete or cover every situation. Tax law is subject to interpretation and legislative change. Tax results and the appropriateness of any product for any specific taxpayer may vary depending on the facts and circumstances. You should consult with and rely on your own independent legal and tax advisors regarding your particular set of facts and circumstances.
MetLife Investors USA Insurance Company, 5 Park Plaza, Suite 1900, Irvine, CA 92614. Metropolitan Life Insurance Company, First MetLife Investors Insurance Company, 200 Park Avenue, New York, NY 10166. All are MetLife companies.
PIMCO advised funds are distributed by PIMCO Investments LLC. PIMCO Investments LLC is not affiliated with MetLife and does not endorse, offer or sell MetLife Longevity Insurance. MetLife does not endorse, offer or sell the PIMCO Real Income 2019 or 2029 Funds.