Build your own portfolio - John Hancock Financial

Build your own portfolio

Do-it-yourself retirement planning Are you the type of person who wants to be very involved in the research, selection and management of your retirement account? If so, you may be a Do-It-Yourself investor and constructing your own portfolio mix from the available Funds and handling the asset allocation yourself may be the right choice for you.

Investment Types All of your investment options through your qualified retirement plan's group annuity contract with John Hancock will fall under one of these categories ? each with an associated level of risk.

Guaranteed Interest Accounts:,*** Guaranteed interest accounts guarantee the return of your principal, plus interest earned over a defined term (for example: three, five or 10 years), as long as contributions remain in the account until the end of the term. Guaranteed Interest Accounts are considered a very low risk investment and are designed to preserve your contributions.

Sub-accounts (Funds): John Hancock's group annuity contracts make various sub-accounts available. A sub-account is an account within a separate account established or maintained by an insurance company. These separate accounts operate apart from and are insulated from the general assets and liabilities of the insurance company.

Contributions to a sub-account ? also called a Fund ? are pooled with those of other plan participants and are invested in underlying mutual funds. The underlying mutual funds may invest in stocks, bonds and money market instruments and other securities. When you invest in a sub-account your contribution purchases units of that Fund. For example, if the unit value is $50 and you contribute $100, then you purchase two units of that Fund. Unit values rise and fall each day and their movements affect the overall value of the Fund and your contributions to that Fund. Sub-accounts include the Lifestyle Portfolio, the Lifecycle Portfolio and other Fund options, color coded to indicate investment risk. Sub-account types include the following:

Money Market Funds:*** Money market funds generally consist of issues from the U.S. Treasury, state and local governments, banks and large corporations. They are considered to be among the safest of investments but have historically provided very low rates of return compared to other types of investment options over the long term.*** Stable value funds preserve principal and provide book value liquidity on a daily basis while earning a consistent and competitive level of income. The underlying investments are diversified, high quality fixed income instruments with an average duration of 2 to 5 years.

Bond Funds:*** Bonds are issued by corporations and governments. When an issuer sells a bond, it is borrowing money from the purchaser. In return, the issuer agrees to pay interest periodically and to repay the amount invested (principal) at a future date when the bond matures. The interest earned is based on the length of the loan and the credit status of the issuer. The value of bonds typically increases as interest rates fall and vice versa.

Stock Funds: A stock is a share of ownership in a company. When a fund buys a stock, it becomes a part owner of that company. The value of a stock depends on how the company is doing and how much people are willing to pay for stock in that company. In general, stocks are considered to be among the riskiest types of investments as stock values can rise and fall over short time periods. Stocks, however, have also historically provided higher long-term returns than other types of investments.

Try to include several different types of funds within each risk category to build a properly diversified^^ portfolio mix that matches your overall risk strategy.

Remember to consider investment and inflation risk Funds investing in stocks can decline due to market, regulatory or economic developments. Investing in foreign securities carries additional risk such as currency fluctuations and changes in political and economic conditions. The securities of small capitalization companies are generally subject to higher volatility than larger, more established companies. Securities investing in a specific sector may experience greater volatility than those investing in a broader range of industries and may be subject to additional risks such as increased competition or changes in legislation or government regulation affecting the sector. Funds investing in High Yield bonds are subject to additional risks such as the increased risk of default.

When selecting your investment options, bear in mind that inflation is a different kind of risk to consider. We've all seen prices go up over time; the cost of a gallon of milk went from $1.02 in 1980 to $3.02 in 2004. In fact, the rate of inflation has averaged about 3.25 per cent per year since 1926.### The danger of being too conservative is that the growth of your retirement savings may not keep pace with inflation and taxes. For this reason, John Hancock has sought to provide you with mixes that are growth-oriented with an appropriate risk orientation in order to help you reach your retirement goals.

Determining your risk tolerance level and strategy In order to create a portfolio that is properly diversified and with an overall risk level that you are comfortable with, you should first determine your own risk tolerance level. Simply take our short Risk Quiz which will help you understand your approach to risk and return and provide you with your personal risk tolerance. Each Fund in our lineup is color-coded to match one of these five risk categories.

Rebalancing your portfolio It is important that you regularly revisit your investment selections and rebalance your portfolio on an ongoing basis to make sure you are properly diversified. Please consult a Financial Representative for advice that is specific to your situation.

 When contributions are allocated to the Guaranteed Interest Account, they will be held in the John Hancock USA general account. Both the principal invested and interest on guaranteed accounts are backed by the claims paying ability of John Hancock USA, but are not insured by the FDIC, the Federal Reserve Board or any agency.

*** Not insured by the FDIC, the Federal Reserve Board or any agency. Although a Guaranteed Interest Account, Money Market Fund and Bond Fund seek to preserve the value of your investment, it is possible to lose money by investing in such a fund.

Sub-accounts are not insured by the FDIC, the Federal Reserve Board or any agency and are subject to investment risks including possible loss of principal amount invested.

^^ Diversification does not eliminate the risk of loss.

### Source: U.S. Department of Labor, Bureau of Labor Statistics, 2003.

To obtain group annuity investment option Fund sheets and prospectuses for each sub-account's underlying investment vehicle call 1-800-395-1113 These documents contain complete details on investment objectives, risks, fees, charges and expenses as well as other information about the underlying investment vehicle, which should be carefully considered. Please read these documents carefully prior to investing.

Group annuity contracts are issued by John Hancock Life Insurance Company (U.S.A.), 197 Clarendon Street, Boston, MA 02116, which is licensed and offers products in all states, except New York. Product features and availability may differ by state. Group annuity contracts and administrative services agreements issued in New York are only issued by John Hancock Life Insurance Company of New York, 100 Summit Lake Drive, Valhalla, New York 10595, which is licensed in NY. John Hancock Investment Management Services, LLC, a registered investment adviser, provides investment information relating to the contracts.

P 11835-GE (11/06-11835)

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