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RIAs and Fee-Based Advisors Say Tax-Deferred Investing Essential to Navigating Fiscal Cliff

Jefferson National's New Survey Shows Majority of Advisors Plan to Leverage Tax Deferral to Mitigate Impact of Expected Tax Increases

LOUISVILLE, Ky., Dec. 13, 2012 /PRNewswire/ -- According to a new survey of Registered Investment Advisors (RIAs) and fee-based advisors conducted by Jefferson National, 75% say their clients are anxious about the impact of the looming fiscal cliff—and  their biggest concern is rising taxes. These same advisors say their clients are demanding tax deferral as a solution to this challenge, topping other potential financial approaches. And advisors agree with their clients, as 85% say that a low-cost tax-deferred investing solution would indeed benefit clients in a time of rising taxes.

"Poised on the brink of the fiscal cliff, the political stalemate that is gripping Washington and driving volatility in the market is clearly a top concern of advisors and their clients, and this is driving an urgent demand for tax-advantaged investing solutions," said Mitchell H. Caplan, Chief Executive Officer of Jefferson National, a recognized innovator singularly focused on serving RIAs, fee-based advisors and their clients.

Financial advisors are forced to grapple with the threat of rising taxes, as the nation's tax bill will escalate by $500 billion, or an average of nearly $3,500 per household, if no solution to the fiscal cliff is reached by year-end, according to the nonpartisan Tax Policy Center. Tax-deferred investing vehicles remain an important solution for mitigating this impact and accumulating retirement savings, which is at the core of ensuring adequate income during retirement years.

At the same time, the threat of ongoing volatility is cited as a primary concern by more than 67% of advisors who are anxious about the fiscal cliff. Coming on the heels of the 2008 downturn, this unprecedented volatility has made advisors' jobs more difficult. In response RIAs and fee-based advisors are also increasingly turning to alternative investment strategies to navigate the current market. Often, these strategies are tax-inefficient, which has led 85% of advisors surveyed to indicate that a low-cost tax-deferred investing solution with a broad choice of alternative strategies would benefit clients in a time of rising volatility.

Jefferson National's research also indicates that tax-efficiency will continue to become increasingly vital to advisors as they continue to allocate more to alternatives in an effort to manage risk and optimize overall portfolio performance. More than 68% of advisors have increased their use of alternative investments, and more than 61% believe that alternatives will become even more important than traditional investments in the future.(1)  Likewise Cerulli research indicates that in five years the use of alternative strategy funds could increase more than a 245%.(2)

"As whipsaw markets create chaos for portfolios, and the threat of rising taxes continues to magnify their clients' anxiety, a clear majority of RIAs and fee-based advisors believe that more alternative strategies and more tax-deferral are needed to meet these challenges head-on," continued Mr. Caplan.

To meet the unique needs of RIAs and fee-based advisors, Jefferson National's Monument Advisor, the industry's first flat fee(3) variable annuity, now tops a total of 390 funds—9 times more funds than the typical VA(4)—with the industry's largest selection of more than 70 alternative investment options, and the most subaccounts with the 5- and 4-star Morningstar Rating for four consecutive years.(5)

More than 250 responses from RIAs and fee-based advisors were recorded in the survey, which was completed December 12, 2012.

For more information, please contact Chris Moon at 973-850-7304 or [email protected] or Deborah Newman at 502-587-3858 or [email protected].

About Jefferson National Financial Corp.  
Jefferson National  is a recognized innovator of tax-deferred investing solutions for RIAs, fee-based advisors and the clients they serve. Creating the industry's largest selection of more than 390 funds, including more than 70 alternative investment options, and utilizing a highly flexible technology platform, an innovative distribution strategy, and cost-effective servicing capabilities, the firm is a winner of more than 30 industry awards including the DMA 2010 Financial Services Company of the Year(6). Serving a network of 2,000 RIAs and fee-based advisors nationwide, the Company is based in Louisville, Ky., with authority in 49 states and the District of Columbia. To reach our advisor support desk, please call 1-866-WHY-FLAT (1-866-949-3528). To learn more, please visit

Important Disclosure:
An investor should carefully consider the investment objectives, risks, charges and expenses of the investment before investing or sending money.  The contract prospectus and underlying fund prospectuses contain this information. For a prospectus containing this and additional information, please contact your financial professional.  Read it carefully before investing. The summary of product features is not intended to be all-inclusive.  Restrictions may apply. The contracts have exclusions and limitations, and may not be available in all states or at all times.

Variable annuities are investments subject to market fluctuation and risk, including possible loss of principal. Your units, when you make a withdrawal or surrender, may be worth more or less than your original investment.

Variable annuities are long-term investments to help you meet retirement and other long-range goals. Withdrawal of tax-deferred accumulations are subject to ordinary income tax. Withdrawals made prior to age 59 ½ may incur a 10% IRS tax penalty. Jefferson National does not offer tax advice. Annuities are not deposits or obligations of, or guaranteed by any bank, nor are they FDIC insured.

Monument Advisor is issued by Jefferson National Life Insurance Company (Dallas, TX) and distributed by Jefferson National Securities Corporation, FINRA member. Policy series JNL-2300-1, JNL-2300-2.

(1)RIAs and Fee-Based Advisors Alternative Investments and Tactical Management Survey, published by Jefferson National, September 2011.

(2)Quantitative Update: ETFs and Retail Alternative Products and Strategies 2012, Cerulli Associates, 2012.

(3)Jefferson National's Monument Advisor has a $20 monthly flat insurance fee. Additional fees ranging from $19.99-$49.99 will be assessed for investors wishing to purchase shares of ultra low-cost funds. See the prospectus for details.

(4)Morningstar data as of 12/31/11.

(5)Morningstar data as of 08/15/12

(6)Jefferson National was reviewed by the Direct Marketing Association, including a panel of independent judges and industry peers, and won for re-engineering the traditional commission-based distribution model and replacing it with an unprecedented web-based direct marketing approach.

CONTACT: Chris Moon
[email protected]   

Deborah Newman
Jefferson National
[email protected]

SOURCE Jefferson National

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