Planning for a Good Life. We can help.

Transcription

1 Planning for a Good Life We can help.

2 Every successful project starts with a plan. A blueprint to make sure each stage of the process moves the project closer to completion of the final design. So, when it comes to creating a good life, everyone could use a blueprint. Yet, more than half of us have no idea how much we need to retire or how much life insurance we need to protect our family and our retirement. In fact, only 14% of us have a written plan to achieve our goals.* Yet we all still want to have a good retirement and secure financial future for our family. The answer? It can be as simple as sitting down with us and making a plan. Think of a financial plan as your own life blueprint. An evolving plan that helps ensure that at every stage of life, you are moving closer to achieving your goals. [ ] Planning is bringing the future into the present so that you can do something about it now. Alan Lakein Author, time management expert * Source: Transamerica Center for Retirement Studies

3 It starts with a conversation. A good plan is the result of careful planning and paying attention to what matters along the way. Life can be hectic. The constant rush of day-to-day demands often makes it hard to keep on the right track. At Allstate, we know life is complicated enough. We believe that creating a financial plan shouldn t have to be complicated, time-consuming or mystifying. That s why we ve made it as simple as possible. Our process helps you create a plan that makes sense, that s easy to understand and that works for your family through each stage of your life. 1

4 Please refer to disclaimer page when considering the topics presented. Creating your own plan. We start with the basics. Understanding where you are, and where you want to be, and using a common sense approach to pull it all together. We can help you prioritize your plan, then adjust and review periodically as you move through the key events and stages of your life. Here s how it works: STEP ONE: Start with your current financial situation. How are you doing with budgeting and saving? Are you protecting what you have? Investing for the future? Thinking about retirement savings? STEP TWO: Think about your goals and priorities. Being successful in meeting your goals can depend on where you are now and your priorities going forward. We ll focus on what matters to you and help you translate that into some simple, achievable goals. STEP THREE: Sketch out the big picture and apply common sense solutions. Once you have established solid goals for your future, we can help you navigate through the financial solutions and options available to sketch out the big picture in a plan that works for you. Together, we can design a realistic plan that can uncover, anticipate and adjust for any surprises along the way. What we ll talk about. Where you are now, and what you want your future to look like What facts about your life you ll need to gather Which options make the most sense for you When to review your plan in the future PREPARED BY Your Allstate Representative Phone: PREPARED FOR Paul and Sally Johnson 123 Anytown Anywhere, USA Phone: (987) September 19, 2016 Paul and Sally Johnson 2016 Financial Review The Need for Responsible Planning What If You Were to Die Today? Many individuals recognize the benefits of planning for the future. Such efforts often uncover problems and frequently provide the motivation to make needed changes. For the most part, the issues involved are positive and enjoyable (e.g., retirement, well-educated children). However, planning for the unexpected known as risk management can be less pleasant. A key part of risk management is answering the question, What if I were to die today? Preparing for an untimely death is often referred to as survivor benefit planning. A subset of estate planning, it addresses the need to keep one s family in their current world, financially. Understandably, no one likes to contemplate his or her own demise. For some, death seems a distant, future event. Others are simply too busy. Whatever the reason, delaying this part of planning can result in expensive, unintended, even tragic consequences. Survivor Benefit Needs The ultimate purpose of survivor benefit planning is twofold: (1) to ensure that the ongoing income needs of the survivor(s) are met, and (2) to provide for immediate lump-sum cash needs. Income needs: How much income will the survivors need, now and in the future, to cover the following: Household living expenses: Will the family stay in the same house? Can they afford to? Do they want to? Will they have the option? Additional childcare: Will there be a need for more help with young children? Educational expenses: Will there be enough money for the children to go to college? What expenses does your family have? Income Replacement Life Needs How Much Life Do You Need? Monthly income $4,500 x 25 years Total $1,350,000 Mortgage Balance Mortgage balance Total $175,000 Education Expenses Total cost of education $100,000 x 1 children Total $100,000 Other Debts and Expenses Current Debt (Auto/Loans/Credit Cards) $20,000 Estimated final medical and funeral expenses (typically $10,000 - $15,000) $10,000 Total $30,000 Total Expenses $1,655,000 What Assets does your family have? Available Assets Available Assets (Savings, CDs, Other) $130,000 Other life insurance $500,000 Total Assets $630,000 Total Life Needed: Total $1,025,000 Income Goals Retirement Analysis You have indicated that you would like to have the following monthly retirement income: 1 At Paul's age 67 and Sally's age 65-80% of current income, or $6,000 At Paul's age 77 and Sally's age % of current income, or $6,000 At Paul's age 82 and Sally's age % of current income, or $5,000 To support your retirement goals you have the Applied Assets following monthly sources: Paul's retirement assets - $897,740 Earned Income Sally's retirement assets - $581,718 Sally's employment income from age 65 until age 67 Other assets - $70,725 Social Security Social Security benefits at Paul's age 67 - $2,304 Social Security benefits at Sally's age 67 - $1,709 Other Income Income Sources Results Assets Available at Retirement According to the analysis, Your funds will be depleted at Sally's age 85. Your current savings of $550 will need to be increased by $550 with the additional monthly savings earning a rate of return of 6.00%. Retirement Cash Flows An additional $446,167 will be required at retirement to meet your goals. Values shown in this presentation are hypothetical and not a promise of future performance. 1 Monthly amounts shown are in today s dollars. Ways to Save for College In accumulating funds for college, one of the first questions a family will face is, Where do we invest the money? Many financial professionals will recommend that money for college be placed in relatively low-risk investments. If there is a long enough time frame, the savings may be placed initially in higher risk (and potentially higher return) investments. As the time for college gets closer, the funds can be shifted into more conservative choices. The ultimate decision will depend on a range of factors such as the number of years until college begins, the amount of money available to invest, a family s income tax bracket, risk tolerance, and investment experience. A few of the more traditional approaches are: Savings accounts: Including CDs, money market accounts, and regular savings. Tax-free municipal bonds: Held either directly or through a mutual fund. U.S. Treasury securities: Such as treasury bills or treasury bonds. Growth stocks/growth mutual funds: For the long-term investor. Tax-Advantaged Strategies Under federal income tax law (state or local income tax law may differ), there are a number of tax-advantaged strategies available to accumulate funds for college expenses. The rules surrounding these strategies can be complicated and they should only be used after careful review with a tax or other financial professional: IRC Sec. 529 qualified tuition program: These plans allow an individual to either prepay a student's tuition, or contribute to a savings account to pay the student's "qualified higher education expenses." Contributions are not tax deductible, but growth in an account is tax-deferred. If certain requirements are met, distributions to pay qualified higher expenses are excluded from income. 529 plans involve investment risk, including possible loss of funds, and there is no guarantee a collegefunding goal will be met. The fees, expenses, and features of 529 plans vary from state to state. 2

5 Pulling it all together. As you go through each stage of life, your relationship to money, income and savings changes. When you start a family, your priority shifts to financially protecting those you love. As you near retirement, the focus is on preserving what you have for your lifetime and perhaps on leaving a legacy. Here s one way to look at your priorities and concerns as they relate to the building blocks of a good financial plan. 1) Key building blocks: Protect; Accumulate and Grow; Preserve; Make it Last. 2) Areas of priorities 3) Types of financial solutions and areas which address your concerns and priorities Managing a Lifetime of Financial Goals MAKE IT LAST Building a plan from the bottom up Estate Planning Other Retirement Income PRESERVE Umbrella Liability Gifting Long Term Care ACCUMULATE AND GROW Savings - Checking Accounts - Savings Accounts - Money Markets Investments - IRAs - Annuities - Stocks & Bonds - College Planning - Employee - Mutual Funds Retirement Plans PROTECT YOUR FOUNDATION Health Auto Homeowners/ Property Disability Income Life Emergency Fund Wills/ Trusts A firm foundation establishes strength and stability for a healthy financial plan. Talk with your Allstate Agent or Personal Financial Representative to protect what you have and discuss next steps to reach your goals for retirement, education and other wealth accumulation. 3

6 Keeping up with life s changes. Like your car or home, a financial plan requires ongoing maintenance and fine-tuning to keep it working to achieve your future goals. That s why your Allstate Agency will not only be there to help you create your plan they ll review it with you annually, or whenever any changes occur as you move through each stage of life. An ongoing, complimentary service. Visit your Allstate Agency to help create a personalized and comprehensive plan for your future. We value the relationship we have with you and want to be there for you when you need us in good times and challenging ones. That s why when you talk with us about anything life insurance, retirement, or any matter that affects your family finances our services are complimentary. Life changes that may require a plan review Buying a new home Birth of a child or grandchild Change in marital status Job loss or career change Start up of new business Big purchase Getting started. Allstate has helped millions of Americans protect and prepare for their financial future. The same company you count on to help you protect your home, auto and business can give you clear and simple ideas about how to protect and achieve your goals for the future. We appreciate that you trust us to help you protect your valuable assets and our goal is to help you protect your family s future too. We re here for you. Your Allstate Agency is there for you when something goes wrong. Today, we re also here to help things go right with innovative solutions and professional assistance to help you protect all the good in your life. [ It s never too soon to plan for a good life! Schedule an appointment today. [ 4

7 We Can Work With That Everyone has hopes for the future. No matter how much or little you ve saved it s never too late to get on the right path to achieving your goals. Allstate can help you with a common sense approach to planning for your future that gives you the confidence to make it more than just a dream. This information is provided for general consumer educational purposes and is not intended to provide legal, tax or investment advice. Life insurance offered through Allstate Life Ins. Co. & Allstate Assurance Co., 3075 Sanders Rd, Northbrook IL 60062; American Heritage Life Ins. Co., 1776 American Heritage Life Dr., Jacksonville FL In New York, life insurance offered through Allstate Life Company of New York, Hauppauge NY. Securities offered by Personal Financial Representatives through Allstate Financial Services, LLC (LSA Securities in LA and PA). Registered Broker-Dealer. Member FINRA, SIPC. Main Office: 2920 South 84th Street, Lincoln, NE (877) Check the background of this form on FINRA s BrokerCheck website ALR5000 3/17 ALR5000KIT