for George J Jones and Marianne P Jones

Transcription

1 [SAMPLE CASE] Financial Plan for George J Jones and Marianne P Jones Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 1

2 Financial Plan [SAMPLE CASE] Party A: George J Jones Party B: Marianne P Jones Date: 0-10:13pm Case: George J Jones vs Marianne P Jones Judge: Marion Winslet, phone: Court: Family Court 333 Monroe St Court address 222 Newtown, PA County: San Francisco Phone: Fax: Contact & Background Information George J Jones SSN: Birth Date: 4/5/1985 State where George J Jones lives: PA Address: 17 Merion Ln, Merion, PA Phone: hjones@merrybuilderscom Marianne P Jones SSN: Birth Date: 11/20/1983 State where Marianne P Jones lives: PA Address: 40 Winding Way, Berwyn, PA Phone: marianne55@hotmailcom Children Tiffany Amber Birth Date: 4/5/2013 Tiffany is a child of this relationship Tiffany is young enough to be eligible for child support George J Jones will claim the tax exemption Tiffany will be a tax exemption until 21 Birth Date: 12/2/2015 Amber is a child of this relationship Amber is young enough to be eligible for child support George J Jones will claim the tax exemption Amber will be a tax exemption until 21 Prepared by: Donna Cheswick PA dcheswick@medallion-wealthcom All data analysis are based on a mutual understanding that the client has provided accurate, reliable and complete financial data The accuracy and completeness of this information is not guaranteed CDFA will make suggestions, based on financial industry best practices An appropriate recommendation can only be made after proper consultation to determine if any of the Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 2

3 strategies are right for you CDFA does not provide legal or tax advice Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 3

4 Table Of Contents [SAMPLE CASE] Key Reports (2) Division of Marital Property (4) Projected Net Worth (5) Summary Totals Spreadsheet (6) Budget Report (7) View/Edit Taxes (8) Spreadsheet for Net Income After Expenses and Taxes (12) Key Entries and Assumptions Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 4

5 Division of Marital Property [SAMPLE CASE] Property division report for George J Jones and Marianne P Jones George Marianne Total Amount Amount Amount Real Estate Equity 40 Winding Way (1) $40,000 $40,000 $80,000 Total Value $450,000 1st Mortgage $320,000 Sep property $50,000 Marital Equity $80,000 Vacation Home $81,250 $0 $81,250 Total Value $100,000 1st Mortgage $18,750 Marital Equity $81,250 Total Real Estate Equity $121,250 $40,000 $161,250 Cash & Investments Cash-Equivalent Investments: First Union $1,875 Bank of America (2) $0 Bank of America $3,292 Total Cash-Equivalent $0 $0 $5,167 Other Investments: Vanguard Index $12,755 Nuveen Bond Fund $10,000 Municipal Bonds $20,000 Total Other Investments $0 $0 $42,755 Total Investments $0 $0 $47,922 Businesses Mary Kay franchise $0 $0 $0 Cars and Personal Effects Jewelry $1,500 $0 $1,500 Paintings (3) $700 $0 $ Toyota Corolla $21, Ford Pickup $24,000 Total Personal Items $2,200 $0 $47,200 Subtotal Non-Retirement $123,450 $40,000 $256,372 IRA/401ks Vanguard IRA $12,555 $0 $12,555 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 5

6 Property division report for George J Jones and Marianne P Jones George Marianne Total Amount Amount Amount Defined Benefit Pensions School district $0 $26,550 $26,550 Total Pensions $0 $26,550 $26,550 Subtotal Retirement $12,555 $26,550 $39,105 Total Assets $136,005 $66,550 $295,477 Debts MasterCard Bank Two ($1,728) ($1,728) ($3,456) VISA Country Card ($3,875) ($3,875) ($7,750) Total Debt ($5,603) ($5,603) ($11,206) Total Debts ($5,603) ($5,603) ($11,206) Total Assets $136,005 $66,550 $295,477 Total Debts ($5,603) ($5,603) ($11,206) Total Marital Property $130,402 $60,947 $284,271 Equalization Payment ($34,728) $34,728 Total Marital After Equalization $95,674 $95,675 Note: $92,922 is unallocated Also, "Total Amount" column may not add due to rounding Footnotes: (1) 40 Winding Way - Marianne will remain in the marital home (2) Bank of America - Funds from Inheritance, kept separate Value is as of most recent bank statement (3) Paintings - Paintings have sentimental value to Marianne Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 6

7 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 7

8 Projected Net Worth [SAMPLE CASE] Projected Net Worth for George J Jones and Marianne P Jones for 10 years Note: Numbers are all as of "end of year" George Marianne George Marianne 2017 $ 154,106 $ 187, $ 349,123 $ 219, $ 176,636 $ 210, $ 400,609 $ 213, $ 214,207 $ 217, $ 443,823 $ 214, $ 256,066 $ 221, $ 486,325 $ 253, $ 301,005 $ 221, $ 531,809 $ 295,708 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 8

9 Summary Totals Spreadsheet [SAMPLE CASE] George Summary Totals Spreadsheet INCOME ASSETS & DEBT Year Age Total Total Total Net After Accum Fin Equity in Other Net Income Expenses Taxes Exp & Tax Savings Assets Real Est IRA/401k Assets/Debt Worth , ,105 53,670 (1,775) ,517 10,040 (2,451) 154, , ,502 50,199 3,624 3, ,345 10,542 (1,875) 176, , ,498 58,456 17,867 21, ,723 11,069 (1,221) 214, , ,949 58,112 20,753 43, ,667 11,622 (477) 256, , ,051 59,289 22,643 67, ,196 12,203 (21) 301, , ,481 60,584 24,232 94, ,330 12, , , ,014 61,944 25, , ,088 13, , , ,574 63,303 27, , ,596 14,127 1, , , ,173 64,710 29, , ,212 14,833 2, , , ,115 66,204 31, , ,479 15,575 2, ,809 Marianne Summary Totals Spreadsheet INCOME ASSETS & DEBT Year Age Total Total Total Net After Accum Fin Equity in Other Net Income Expenses Taxes Exp & Tax Savings Assets Real Est IRA/401k Assets/Debt Worth , ,193 12,169 (10,978) 0 13, , , , , ,081 12,711 (12,591) , , , , ,046 8,783 (30,256) (29,662) 0 203, , , , ,460 10,045 (34,860) (64,522) 0 236, , , , ,001 10,381 (38,628) (103,150) 0 271, , , , ,219 10,619 (42,950) (146,100) 0 307, , , , ,952 10,872 (47,778) (193,878) 0 344, , , ,231 99,008 11,129 (14,906) (208,784) 0 355, , , ,443 56,961 11,390 28,092 (180,692) 0 362, , , ,682 54,331 12,266 31,085 (149,607) 0 369, , ,708 Note: Numbers are all as of "end of year" Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 9

10 Budget Report for 2017 [SAMPLE CASE] This report shows George's and Marianne's income, taxes, expenses, including alimony income and child support income, including alimony expenses and child support expenses George Marianne Monthly Monthly Income Merry Builders, Inc $14,58333 $000 Marianne's Employer # ,11667 Bonuses Total Wage and Non-Wage Income $15,25000 $4,11667 Investment Income Bank of America $000 $4167 Total Investment Income $000 $4167 Business Income Mary Kay franchise $000 $16667 Total Business Income $000 $16667 Support Received Child Support Received $000 $3,00500 Alimony Received $000 $1,70200 Total Support Received $000 $4,70700 TOTAL INCOME $15,25000 $9,03200 Mortgage Payments 40 Winding Way (1) $000 $3,75000 Vacation Home $000 $20000 Total Mortgage Payments $000 $3,95000 Living Expenses Rent $1,20000 $90000 Homeowners' Insurance Real Estate Tax Cable TV Internet Access Painting/Wallpapering Household Supplies Maid/Cleaning Service Lawn Service Utilities - Electricity Utilities - Oil Heat Car Payments Car Insurance 1, Car Gasoline/Oil Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 10

11 George Marianne Monthly Monthly Car Maintenance and Repair Car License/Stickers Parking Public/Alt Transportation Child Care - Day Care Child Education Lunches Bank Fees Cell Phone Clothes Charitable Church/Synagogue/Mosque etc Dues/Clubs Entertainment Food/Groceries Gifts Hair Laundry Restaurants Subscriptions, Books Toiletries/Grooming/Drug Store Vacations Other Personal Medical/Doctor Dental Drug & Prescription Total Living Expenses $6,12083 $2,80200 Major Expenses Tiffany's college $000 $2,08333 Total Major Expenses $000 $2,08333 Debts MasterCard Bank Two $3750 $3750 VISA Country Card $6000 $6000 Total Debt Payments $9750 $9750 Support Paid Child Support Paid $3,00500 $000 Alimony Paid 1, Total Support Paid $4,70700 $000 TOTAL EXPENSES $10,92533 $8,93283 Taxes Federal Taxes $3,08250 $56642 FICA & Medicare $92183 $31492 State Taxes (estimate only) $46817 $13275 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 11

12 George Marianne Monthly Monthly Local Wage Tax $000 $000 TOTAL TAXES $4,47250 $1,01408 Total Income $15,25000 $9,03200 Minus Total Expenses (10,92533) (8,93283) Minus Total Taxes (4,47250) (1,01408) BUDGET NET INCOME $(14783) $(91492) Footnotes: (1) 40 Winding Way - Marianne will remain in the marital home Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 12

13 View/Edit Taxes for 2017 [SAMPLE CASE] George Marianne Filing Separate Head Hsld Filing Status in Number of exemptions Income: 175,000 49,400 Wages and salary 0 Taxable interest income Taxable dividend income 0 20,424 Alimony income 2,000 Business and farm income 0 Capital gain taxable Other gains and losses Taxable IRA and pension income Rent, royalty, partnership, S corporation Social Security taxable 8,000 Other income 183,000 72,324 Taxable gross income Adjustments: Payroll deductions for health, etc IRA/401k deduction Moving expenses 142 Deduction of 1/2 of self-employment tax Part of health insurance for self-employed people 20,424 0 Alimony paid Interest on education loans Other deductions 20, Total adjustments 162,576 72,182 Adjusted Gross Income ("AGI") = gross income - total adjustments) Itemized Deductions: 2, Total medical expenditures Info only: Medical expense threshold % (75% or 100%, depending on year and age) 16,258 7,218 Info only: Medical expense threshold = Medical expense threshold % * AGI Deductible medical (= medical expenses in excess of threshold) 5,618 1,593 State income taxes Local income taxes 3,000 Real estate taxes 9,728 Mortgage interest 2,000 Charitable contributions 50 Miscellaneous, subject to 2% AGI threshold miscellaneous, after 2% AGI threshold Miscellaneous, not subject to 2% AGI threshold 7,618 14,321 Itemized deductions before phase-out 7,448 14,321 Itemized deductions after phase-out 6,350 9,350 Standard deduction 7,448 14,321 Deduction to use Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 13

14 George Marianne Exemptions: 12,150 4,050 Deduction for exemptions before phase-out 10,935 4,050 Deduction for exemptions after phase-out Tax Before Credits and Other Taxes: 144,193 53,811 Taxable Income = AGI - greater of itemized or standard deductions - exemptions 35,192 7,659 Tax before credits and other taxes Marginal federal tax bracket (%) Non-refundable Credits: 2 # children for child care credit 1,145 Child care credit American Opportunity Tax Credit, non-refundable portion Lifetime learning credit Child credit, after phase-out, non-refundable portion 1,145 Total non-refundable credits (reduce tax, but not below zero) Refundable Credits: Child credit, after phase-out, refundable portion 2 # Children qualifying for Earned Income Credit Earned income credit Making work pay credit American Opportunity Tax credit, refundable portion Total refundable credits (can reduce tax below zero and generate a payment from the IRS) Other Taxes on Form 1040: Tax on retirement plan premature distribution 1,798 Alternative minimum tax Lump-sum distribution 5- or 10- year averaging 283 Self-employment tax 0 Unearned Income Medicare Contribution Total Federal Income Tax: = tax before credits and other taxes - total nonrefundable credits (down to zero) - total refundable credits + other taxes on Form ,990 6,797 Total Federal Income Tax 20 9 Average federal tax rate (= Fed Tax / Gross Income) (%) Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 14

15 George Marianne Taxes Not on Form 1040: 7,886 3,063 FICA Taxes 3, Medicare Taxes 5,618 1,593 State Income Tax (estimate only) Local Wage Tax Total Taxes: 53,670 12,169 Total taxes Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 15

16 Spreadsheet for Net Income After Expenses and Taxes (Annual) [SAMPLE CASE] George Spreadsheet for Net Income After Expenses and Taxes Year Age Wages & Non-Wage Income on Total Living Alimony Child Payments Total Pre-tax Salary Income Accum Svg Income Expenses Paid Supt Pd on Debt Expenses Cash flow ,000 8, ,000 73,450 20,424 36,060 1, ,105 51, ,325 8, ,325 74,847 20,424 36,060 1, ,502 53, ,713 8, ,821 76, ,060 1, ,498 76, ,166 8, ,814 77, ,060 1, ,949 78, ,684 8,000 1, ,983 79, , ,051 81, ,269 8,000 2, ,297 80, , ,481 84, ,922 8,000 2, ,760 82, , ,014 87, ,645 8,000 3, ,368 83, , ,574 90, ,438 8,000 4, ,136 85, , ,173 93, ,303 8,000 5, ,066 87, , ,115 97,951 George Spreadsheet for Net Income After Expenses and Taxes Year Age Federal FICA / State Tax Total Net After Inc Tax Soc Sec (Estimate) Taxes Exp&Tax ,990 11,062 5,618 53,670 (1,775) ,741 10,738 5,720 50,199 3, ,688 10,940 5,828 58,456 17, ,016 11,146 5,950 58,112 20, ,856 11,355 6,078 59,289 22, ,802 11,571 6,211 60,584 24, ,775 11,821 6,348 61,944 25, ,737 12,077 6,489 63,303 27, ,738 12,337 6,635 64,710 29, ,815 12,602 6,787 66,204 31,747 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 16

17 Marianne Spreadsheet for Net Income After Expenses and Taxes Year Age Wages & Business Fin Child Alimony Total Living Major Mortgage Payments Salary Income Invest Support Received Income Expenses Expenses Payments on Debt ,400 2, ,060 20, ,384 33,624 25,000 47,400 1, ,339 2, ,060 20, ,201 34,262 26,250 47,400 1, ,295 2, , ,573 34,914 27,563 47,400 1, ,270 2, , ,645 35,578 28,941 47,400 1, ,263 2, , ,754 36,254 30,388 47, ,275 2, , ,888 36,941 31,907 47, ,306 2, , ,046 37,643 33,502 47, ,357 2, , ,231 38,357 35,178 9, ,428 2, , ,443 39, ,519 3, , ,682 39, Marianne Spreadsheet for Net Income After Expenses and Taxes Year Age Acc Debt Total Pre-tax Federal FICA / State Tax Total Net After Interest Expenses Cash flow Inc Tax Soc Sec (Estimate) Taxes Exp&Tax ,193 1,191 6,797 3,779 1,593 12,169 (10,978) , ,242 3,851 1,618 12,711 (12,591) ,046 (21,473) 3,216 3,924 1,643 8,783 (30,256) , ,460 (24,815) 4,370 3,999 1,676 10,045 (34,860) , ,001 (28,247) 4,597 4,074 1,710 10,381 (38,628) , ,219 (32,331) 4,722 4,152 1,745 10,619 (42,950) , ,952 (36,906) 4,861 4,231 1,780 10,872 (47,778) ,510 99,008 (3,777) 5,001 4,311 1,817 11,129 (14,906) ,703 56,961 39,482 5,142 4,394 1,854 11,390 28, ,455 54,331 43,351 5,897 4,477 1,892 12,266 31,085 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 17

18 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 18 Key Entries and Assumptions [SAMPLE CASE] This report presents the key assumptions behind the income and asset projections for George J Jones and Marianne P Jones Key Rates 1Inflation 19 % 2 George - Interest rate of return on accumulated (re-invested) savings 100 % 3 George - Dividend rate of return on accumulated (re-invested) savings 100 % 4 George - Capital Gain income rate on accumulated (re-invested) savings 100 % 5 George - Tax-free income rate of return on accumulated (re-invested) savings 000 % 6 George - Appreciation on accumulated (re-invested) savings 400 % 7 George - Interest rate on borrowing to cover excess spending 800 % 8 Marianne - Interest rate of return on accumulated (re-invested) savings 100 % 9 Marianne - Dividend rate of return on accumulated (re-invested) savings 100 % 10 Marianne - Capital Gain income rate on accumulated (re-invested) savings 100 % 11 Marianne - Tax-free income rate of return on accumulated (re-invested) savings 000 % 12 Marianne - Appreciation on accumulated (re-invested) savings 400 % 13 Marianne - Interest rate on borrowing to cover excess spending 800 % Taxes 1 Federal taxes are calculated on a detailed basis using the tax laws for each year, including Earned Income Credit, Alternative Minimum tax, and phase-outs currently enacted 2 Taxes for George J Jones Federal and state filing status for 2017 Married Filing Separately Filing status for subsequent years Single State taxes are estimated by applying the current tax table to gross income In Pennsylvania, alimony and retirement income are excluded from taxable income 3 Taxes for Marianne P Jones Federal and state filing status for 2017 Head of Household Filing status for subsequent years Head of Household State taxes are estimated by applying the current tax table to gross income In Pennsylvania, alimony and retirement income are excluded from taxable income Assumptions Relating to Children Custody Tax Exemption 1 Tiffany Marianne George 2 Amber Marianne George

19 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 19 Assumptions Relating to Child Support 1 George paying child support through 4/2031 $ 3,005 per month 2 Then, child support through 12/2033 $ 2,672 per month Assumptions Relating to Alimony 1 George paying alimony through 12/2018 $ 1,702 per month 2 Then, alimony through 12/2018 $ 500 per month Real Estate Assumptions - 40 Winding Way 1 Market Value $450,000 2 Rate of appreciation of property With Inflation 3 This property will not be sold in the time frame under consideration 4 There is a first mortgage with a current mortgage balance of $320,000 5 This mortgage will be paid by Marianne Real Estate Assumptions - Vacation Home 1 Market Value $100,000 2 Rate of appreciation of property With Inflation 3 This property will not be sold in the time frame under consideration 4 There is a first mortgage with a current mortgage balance of $18,750 5 This mortgage will be paid by Marianne Assumptions Relating to Wages George Merry Builders, Inc: 1 Wage amount and period $175,000 / year 2 Rate of increase of wages With Inflation 3 Retirement age 65 Marianne Marianne's Employer #1: 1 Wage amount and period $950 / week 2 Rate of increase of wages With Inflation 3 Retirement age 65 Assumptions Relating to Major Expenses 1 Tiffany's college expense will start on 1/1/2017, run for 4 years The annual cost is $25,000 in present dollars, and will increase at a rate of 50% Marianne P Jones will pay 100% of this expense

20 2 Amber's college expense will start on 1/1/2021, run for 4 years The annual cost is $25,000 in present dollars, and will increase at a rate of 50% Marianne P Jones will pay 100% of this expense Assumptions Relating to Cash & Investments 1 First Union [Checking]: The current market value is $1,875 The annual income from this asset is $0 The annual rate of appreciation is 00% 2 Vanguard Index 500 [Mutual fund]: The current market value is $12,755 The annual income from this asset is $1,000 The annual rate of appreciation is 80% 3 Bank of America [Checking]: The current market value is $25,000 The annual rate of return is 20% The annual rate of appreciation is 30% 4 Nuveen Bond Fund [Bond fund]: The current market value is $10,000 The annual rate of return is 46% The annual rate of appreciation is 00% 5 Municipal Bonds [Tax-exempt]: The current market value is $20,000 The annual rate of return is 22% The annual rate of appreciation is 00% 6 Bank of America [Checking]: The current market value is $3,292 Assumptions Relating to IRA/401k Plans 1 Vanguard IRA The current value is $12,555, and the growth rate is 50% The age at which distributions will start for George J Jones is 70 George J Jones will take minimum distributions at retirement Assumptions Relating to Defined Benefit Pensions 1 School district The plan is owned by Marianne P Jones The monthly benefit is $945 This assumes the participant works until the cut-off date and begins receiving payments at age 65 The discount rate is 432% We are using mortality table RP-2000 Assumptions Relating to Debts 1 MasterCard Bank Two The current balance is $3,456 The current rate is 12000% The monthly payment is $ VISA Country Card The current balance is $7,750 The current rate is 14000% The monthly payment is $12000 Prepared by Donna Cheswick (c) FLS Inc All analysis/results are based on data and information supplied by client The accuracy and completeness of this information is not guaranteed Page 20