|
|  |
 | |
|
 |  | |
As long as your money stays in the plan, it can grow tax-deferred. As the account
grows, any earnings in the plan are reinvested, creating a compounding effect.
The more time you have to save, the greater the possibility for growth.
Tax-deferred compounding can make a significant difference in the total amount
saved in your account.
| |
| |
| Withdrawals from the account to pay for qualified expenses are federal income tax free. For nonqualified withdrawals, the earnings will be taxed as ordinary income, and a 10% federal tax penalty may apply. | |
|
| |
Neither Pacific Life nor its representatives give tax or legal advice. You should consult your
tax adviser and attorney regarding your specific situation.
The chart above illustrates the hypothetical growth of $350 monthly contributions, assuming investments earn a hypothetical 8% rate of return,
compounded annually. Hypothetical returns do not include any product charges, which would reduce performance if they were included. The taxable
account assumes a 33% tax rate. Actual tax rates may vary for different taxpayers and assets (e.g., capital gains and qualifying dividend income).
The chart is for illustrative purposes only. It does not reflect an actual investment. The earnings portion of nonqualified withdrawals is taxable
and subject to a 10% federal tax penalty.
| |
|
|
|
