SAMPLE. John and Jane Smith. LifeView Financial Plan. Prepared by: John Advisor, CFP Financial Advisor. January 04, 2016

Transcription

1 LifeView Financial Plan John and Jane Smith Prepared by: John Advisor, CFP Financial Advisor January 04, 2016

2 Table Of Contents IMPORTANT DISCLOSURE INFORMATION 1-6 Summary of Goals and Resources Personal Information and Summary of Financial Goals 7-8 Net Worth Summary - All Resources 9 Net Worth Detail - All Resources Resources Summary Current Portfolio Allocation Target Band 17 Results What If Worksheet Worksheet Detail - Combined Details Worksheet Detail - Health Care Expense Schedule Worksheet Detail - Inside the Numbers Final Result 34 Worksheet Detail - Allocation Comparison Worksheet Detail - Bear Market Test 37 Worksheet Detail - Special Asset Test 38 Worksheet Detail - Concentrated Position Test 39 Worksheet Detail - Portfolio Probability Matrix 40 Worksheet Detail - Social Security Maximization Worksheet Detail - Retirement Distribution Cash Flow Chart Worksheet Detail - Sources of Income and Earnings 52 Employer Stock Plans Stock Options Stock Options Summary Risk Management Life Insurance Needs Analysis 59 Life Insurance Needs Analysis Detail Disability Needs Analysis - John Disability Needs Analysis - Jane Long-Term Care Needs Analysis - John 69 Long-Term Care Needs Analysis - Jane 70 Estate Analysis Estate Introduction 71 Estate Assumptions 72 Estate Analysis Options 73 Estate Analysis Current Asset Ownership Detail Estate Analysis Results Combined Summary 76 Estate Analysis Results Flowchart Estate Analysis What If Results Combined Summary Estate Analysis What If Results Flowchart Appendix Risk Assessment Investment Assets by Tax Category Goal Assignment Summary 92 Tax and Inflation Assumptions 93 IMPORTANT DISCLOSURE INFORMATION Return Methodology and Asset Allocation Key Asset Class Risk Considerations Glossary of Terms

3 IMPORTANT DISCLOSURE INFORMATION Your Morgan Stanley Financial Advisor should have provided you with the ADV brochure, the brochure supplement, and the Privacy Notice at the back of this Financial Plan. Please contact your Financial Advisor if you have not received these disclosure documents. IMPORTANT: The projections or other information generated by LifeView Advisor regarding the likelihood of various investment outcomes (including any assumed rates of return) are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. Every individual s financial circumstances, needs and risk tolerances are different. This LifeView Financial Plan (the "Financial Plan") is based on the information you provided to us, the assumptions you have asked us to make and the other assumptions indicated herein as of the date of the Financial Plan. It is not an official account statement. The purpose of taking the time to organize your financial life is to gain better control of your financial future. This Financial Plan should be considered a working document that can assist you with this objective. You should carefully review the information and suggestions found in this Financial Plan and then decide on future steps. LifeView Advisor Assumptions and Limitations Information Provided by You Information that you provided about your assets, financial goals, and personal situation are key assumptions for the calculations and projections in this Financial Plan. Please review all the information thoroughly to ensure that it is correct and complete. In particular, please review the Financial Plan sections titled "Personal Information and Summary of Financial Goals", "Current Portfolio Allocation", and "Tax and Inflation Assumptions" to verify the accuracy of these assumptions. If any of the assumptions are incorrect, you should notify your Financial Advisor. Even small changes in assumptions can have a substantial impact on the results shown in this Financial Plan. The information provided by you should be reviewed periodically and updated when either the information or your circumstances change. Morgan Stanley has no responsibility and is under no obligation to monitor or update this Financial Plan in the future unless expressly engaged by you to do so at that time. Asset Allocation Information Any asset allocation information presented herein, which may take into account your assets in one or more Employee Retirement Income Security Act of 1974, as amended ("ERISA")-covered employee benefit plans and/or one or more individual retirement accounts, is for general asset allocation education and information purposes only, and should not be viewed as fiduciary investment advice or specific recommendations with respect to any particular investment or asset allocation mix under the Investment Advisers Act of 1940 as amended, ERISA, the Internal Revenue Code or any other applicable law. In applying any particular asset allocation model to your individual circumstances, you should consider your other assets, income and investments, in addition to any interest(s) you may have in ERISA-covered employee benefit plans or individual retirement accounts. Thus, it is very important for you to insure that you review this Financial Plan to make sure that it includes all of your assets, income and investments. Assumptions and Limitations LifeView Advisor offers several methods of calculating results, each of which provides one outcome from a wide range of possible outcomes. LifeView Advisor does not purport to recommend or implement an investment strategy. Financial forecasts, rates of return, risk, inflation, and other assumptions may be used as the basis for illustrations in LifeView Advisor. They should not be considered a guarantee of future performance or a guarantee of achieving overall financial objectives. All results use simplifying estimates and assumptions that are not tailored to your specific circumstances. No Financial Plan has the ability to accurately predict the future, eliminate risk or guarantee investment results. As investment returns, inflation, taxes, and other economic conditions vary from the LifeView Advisor assumptions, your actual results will vary (perhaps significantly) from those presented in this Financial Plan. The assumed return rates in LifeView Advisor are not reflective of any specific investment and do not include any fees or expenses that may be incurred by investing in specific products. The actual returns of a specific investment may be more or less than the returns used in LifeView Advisor. The return assumptions are based on historic rates of return of securities indices which serve as proxies for the broad asset classes. It is not possible to directly invest in an index. Moreover, different forecasts may choose different indices as a proxy for the same asset class, thus influencing the return of the asset class. LifeView Advisor results may vary with each use and over time. LifeView Advisor is powered by MoneyGuidePro Page 1 of 106

4 IMPORTANT DISCLOSURE INFORMATION The return assumptions used in this Financial Plan are estimates based on average annual returns for the index used as a proxy for each asset class. The portfolio returns are calculated by weighting individual return assumptions for each asset class according to your portfolio allocation. During the preparation of these analyses, your Morgan Stanley Financial Advisor may have refined the asset allocation strategy to develop a strategy which optimizes the potential returns that could be achieved with the appropriate level of risk that you would be willing to assume. Asset classes not included may have characteristics similar or superior to those being analyzed. Hypothetical performance results have inherent limitations. There are frequently large differences between hypothetical and actual performance results subsequently achieved by any particular asset allocation or trading strategy. Hypothetical performance results do not represent actual trading and are generally designed with the benefit of hindsight. They cannot account for all factors associated with risk, including the impact of financial risk in actual trading or the ability to withstand losses or to adhere to a particular trading strategy in the face of trading losses. There are numerous other factors related to the markets in general or to the implementation of any specific trading strategy that cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results. Morgan Stanley cannot give any assurances that any estimates, assumptions or other aspects of the analyses will prove correct. They are subject to actual known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those shown. These analyses speak only as of the date of this Financial Plan. Morgan Stanley expressly disclaims any obligation or undertaking to update or revise any statement or other information contained herein to reflect any change in past results, future expectations or circumstances upon which that statement or other information is based. Rate of Return Methodology The analysis contained in the Financial Plan is conducted using the Morgan Stanley Wealth Management Global Investment Committee s Secular Return Estimates ( GIC Estimate ). GIC Estimate approved returns are generated based on proprietary formulas which include studying historical return averages of the broad market indices and making strategic adjustments for more recent market conditions and other factors deemed relevant by the forecaster. The Return Methodology and Asset Allocation sections include a description of the return methodology that has been used to prepare this Financial Plan. The methodology should be carefully considered in evaluating the results presented to you. Results Using Monte Carlo Simulations Monte Carlo simulations are used to show how variations in rates of return each year can affect your results. A Monte Carlo simulation calculates the results of your Plan by running it many times, each time using a different sequence of returns. Some sequences of returns will give you better results, and some will give you worse results. These multiple trials provide a range of possible results, some successful (you would have met all your goals) and some unsuccessful (you would not have met all your goals). The percentage of trials that were successful is shown as the probability that your Plan, with all its underlying assumptions, could be successful. In LifeView Advisor, this is the Probability of Success. Analogously, the percentage of trials that were unsuccessful is shown as the Probability of Failure. The Results Using Monte Carlo Simulations indicate the likelihood that an event may occur as well as the likelihood that it may not occur. In analyzing this information, please note that the analysis does not take into account actual market conditions, which may severely affect the outcome of your goals over the long-term. LifeView Advisor is powered by MoneyGuidePro Page 2 of 106

5 IMPORTANT DISCLOSURE INFORMATION IMPORTANT NOTES AND DISCLOSURES FROM MORGAN STANLEY Morgan Stanley provides its existing and prospective customers with a number of financial tools that produce certain reports to assist customers in managing their wealth and assets. This LifeView Financial Plan was generated by using a computer software program developed by MoneyGuidePro, a third party software provider. Results may vary with each use of the software and over time. Enhancements and changes to the software may be made in the future. Morgan Stanley is not responsible for the accuracy of the assumptions made in the Financial Plan, or the calculations in the analysis. Future Financial Plans that are generated may contain information capabilities, and other content, that is more expansive or otherwise different from the content of this Financial Plan. This Financial Plan does not constitute an offer to buy, sell, or recommend any particular investment or asset, nor does it recommend that you engage in any particular investment, manager or trading strategy. It reflects only allocations among broad asset classes. All investments have risks. The decisions as to when and how to invest are solely your responsibility. By providing you this Financial Plan, neither Morgan Stanley nor your Financial Advisor is acting as a fiduciary for purposes of ERISA or section 4975 of the Code with respect to any ERISA-covered employee benefit plan or any individual retirement account in either the planning, execution or provision of this analysis. Unless otherwise provided in a written agreement between you and Morgan Stanley, Morgan Stanley, its affiliates and their respective employees, agents and representatives, including your Financial Advisor: (a) do not have discretionary authority or control with respect to the assets in any ERISA-covered employee benefit plan or any individual retirement account included in this Financial Plan, (b) will not be deemed an "investment manager" as defined under ERISA, or otherwise have the authority or responsibility to act as a "fiduciary" (as defined under ERISA) with respect to such assets, and (c) will not provide "investment advice," as defined by ERISA and/or section 4975 of the Code, as amended, with respect to such assets. This Financial Plan will be deemed to create an investment advisory relationship between you and Morgan Stanley that begins upon delivery of the Financial Plan to you and ends thirty days later, during which time your Financial Advisor is available to review the LifeView Financial Plan with you. This advisory relationship means that the services we offer are governed by different laws and separate contracts than those relating to a brokerage relationship. Our investment advisory relationship is separate and distinct from any brokerage relationship that you may have with Morgan Stanley on any of your accounts. When Morgan Stanley is acting in its capacity as your broker, Morgan Stanley is governed by securities laws which regulate broker-dealers such as the Securities Exchange Act of 1934 and the Securities Act of However, when acting in an advisory capacity, Morgan Stanley will be subject to different laws which govern investment advisers, such as the Investment Advisers Act of For example, investment advisers, unlike brokers, are required to disclose to their advisory clients if any of the investment adviser s affiliates receive any additional compensation as a result of the advisory relationship. Additionally, investment advisers may have an obligation to monitor their clients advisory accounts and to make ongoing recommendations to them, while a broker has no such obligations. When preparing a Financial Plan, Morgan Stanley may take into consideration assets held in your Morgan Stanley brokerage accounts. However, those accounts will remain brokerage accounts and will not become advisory accounts as a result of the Financial Plan. That means that Morgan Stanley will not have advisory duties on those accounts and that you will continue to be responsible for monitoring and making all investment decisions with respect to those accounts. For additional answers to questions about the difference between our investment advisory and brokerage services, please visit our web site at or contact us at Page 3 of 106

6 IMPORTANT DISCLOSURE INFORMATION IMPORTANT NOTES AND DISCLOSURES FROM MORGAN STANLEY (continued) Morgan Stanley is both a registered broker-dealer and investment adviser and its Financial Advisors act in dual capacities as broker-dealer and investment advisory representatives. Many Morgan Stanley Financial Advisors may use the designation Certified Financial Planner or "CFP," a certification mark owned by the Certified Financial Planner Board of Standards, Inc. Each of these Financial Advisors also is licensed to act as a broker-dealer representative on behalf of Morgan Stanley. When any of these Financial Advisors assists clients by providing them a Financial Plan, he/she is doing so as a CFP and investment advisory representative of Morgan Stanley. However, in providing other services to customers, such as assisting customers in implementing a Financial Plan once it has been delivered, providing financial tools/reports to customers, or effecting transactions for the customer's brokerage account, the Financial Advisor carrying a CFP designation is only acting as a broker-dealer representative unless the Financial Advisor and client have entered into a written agreement that creates an investment advisory relationship. Please keep in mind that Morgan Stanley is not a tax or legal advisor and this Financial Plan does not constitute tax, legal or accounting advice. You should discuss any tax and legal information outlined in this document with your accounting, tax and legal advisors prior to taking action. Your Morgan Stanley Financial Advisor can work with you and these advisors to answer your questions and, if you choose, help you implement the options you decide upon. There is no requirement, however, that you implement any strategies at all. In addition, you are not obligated to implement any options shown in this Financial Plan or to otherwise conduct business through Morgan Stanley or its affiliates. Timing for implementing, monitoring and adjusting your strategies is a critical element in achieving your financial objectives. You are responsible for implementing, monitoring and periodically reviewing and adjusting your investment strategies. By accepting delivery of this Financial Plan, you are deemed to acknowledge and agree that: 1) you have reviewed and accept the information contained within this Financial Plan and understand the disclaimers, assumptions and methods included with it; 2) you believe that all information provided by you is complete and accurate to the best of your knowledge; 3) you understand that Morgan Stanley and your Financial Advisor are not fiduciaries under ERISA or the Internal Revenue Code with respect to this Financial Plan or your use or our use (on your behalf) of the software which generated this Financial Plan, or your IRA and retirement plan accounts unless otherwise provided in a written agreement between you and Morgan Stanley. The information in this Financial Plan is provided to you on the understanding that, for purposes of ERISA and the Code, it is intended to be educational material, will not form a primary basis for any investment decision made by you or on your behalf, and will not be viewed for ERISA or Code purposes as fiduciary investment advice or specific recommendations with respect to asset allocation or any particular investment, and that (unless otherwise provided in a written agreement) you remain solely responsible for your assets and all investment decisions with respect to your assets; and 4) you understand and accept each of the terms of the attached Engagement Agreement. Powered by MoneyGuidePro and MoneyGuidePro are marks of PIEtech, Inc Morgan Stanley Smith Barney LLC. Member SIPC. Page 4 of 106

7 IMPORTANT DISCLOSURE INFORMATION Engagement Agreement for your LifeView Financial Plan This Engagement Agreement (this "Agreement") is designed to provide you with information that will ensure that you understand the nature of your financial planning relationship with Morgan Stanley Smith Barney LLC ("MSSB"). There are certain items that reflect limitations on the duration of your financial planning relationship, which are designed to ensure that MSSB will be able to continue to service your brokerage or other advisory needs with maximum flexibility. If any of these items do not reflect your understanding, you should immediately contact your Financial Advisor or Private Wealth Advisor (together referred to herein as your "Financial Advisor") as applicable. The LifeView Financial Plan (the "Financial Plan") is a financial planning service for which MSSB may charge a fee as agreed to by you and your Financial Advisor. If a fee is charged, you will be provided with a Financial Planning Fee Consent Form that will set forth the fee amount and payment options for the Financial Plan. See the MSSB Financial Planning Services ADV brochure for more information about MSSB s financial planning services, including information about compensation and fee arrangements and conflicts of interests. This document has been provided to you with your Financial Plan, and is also available at or from your Financial Advisor upon request. The Financial Plan is reliant on the information you provide to MSSB. The quality of the plan MSSB prepares for you is dependent on the completeness and accuracy of this information. Furthermore, your Financial Advisor and MSSB will only be responsible for correcting and updating the information you provided and/or the Financial Plan (e.g., to reflect future changes in your life, financial situation, goals, and market or economic conditions) if you engage them to do so. As a result, the Financial Plan may very well become outdated or inaccurate as these factors change over time, unless you take steps to work with your Financial Advisor to correct and update the Financial Plan. All investments have risks. The performance and attainment of financial objectives is not guaranteed. All estimates and assumed data, including returns, are hypothetical and do not represent a guarantee or promise of future results. The date of this Agreement shall be the date of delivery of the Financial Plan to you. An investment advisory relationship is created between you and MSSB that begins upon delivery of the Financial Plan to you and ends thirty days later, during which time your Financial Advisor is available to review the Financial Plan with you. If you engage your Financial Advisor to make changes to the Financial Plan after this thirty day period, a new investment advisory relationship will be created again each time an updated Financial Plan is delivered to you; and it will end thirty days later, during which time your Financial Advisor will again be available to review the Financial Plan with you. In addition, this Agreement and the investment advisory relationship hereunder may be terminated by MSSB or by you at any time upon oral or written notice to the other party. This advisory relationship is separate from the relationship(s) created by other accounts and services that you may have with MSSB. You and your Financial Advisor can reopen the planning relationship at any time. When preparing the Financial Plan, MSSB may consider assets held in your MSSB brokerage accounts. However, those accounts will remain brokerage accounts and will not become advisory accounts as a result of the Financial Plan. You will continue to be responsible for monitoring and making all investment decisions for those accounts. In order to ensure that your brokerage accounts remain as such, and thus you can take advantage of the full range of services and investment products offered through those accounts, please understand that if the assets of any employee benefit plan covered by the Employee Retirement Income Security Act of 1974, as amended, ( ERISA ), Keogh Plan or IRA ( Retirement Assets ) are taken into account in the Financial Plan, all information and materials provided in the Financial Plan are (a) as noted above, based upon the information provided by you, and various assumptions, (b) intended for educational purposes only, and (c) provided to you by MSSB with the understanding that, for the purposes of ERISA and the Internal Revenue Code of 1986, as amended (the Code ), the reports are general in nature, and will not form a primary basis for any investment decision made by you or on your behalf. These understandings are designed to ensure that MSSB and its Financial Advisors, in providing this product, are not and will not be viewed (by you or anyone else) as providing fiduciary investment advice or specific recommendations with respect to asset allocation or any particular investment for those Retirement Assets, and thus MSSB and its Financial Advisors will not be acting as a fiduciary under either ERISA or the Code with respect to such assets. You understand that MSSB and its Financial Advisors do not provide tax or legal advice, and that you should consult with your personal advisors with respect to the tax and legal implications of the Financial Plan, as appropriate. Page 5 of 106

8 IMPORTANT DISCLOSURE INFORMATION An assignment of this Agreement and financial planning relationship to a new investment adviser firm will not be made without your prior consent, which may be obtained by providing you at least seven days prior notice of the assignment. You have sole responsibility for making all investment decisions with respect to the implementation of the Financial Plan. You may implement the Financial Plan at MSSB or at another firm. If you engage or have engaged MSSB, it will act as your broker, unless you ask MSSB, in writing, to act as your investment adviser on any particular account. As noted above, if the foregoing does not reflect your understanding of your relationship with MSSB and your Financial Advisor and the nature of the firm s financial planning services, including the services that are provided to you in connection with the preparation of your Financial Plan, you should immediately contact your Financial Advisor Morgan Stanley Smith Barney LLC. Member SIPC. Page 6 of 106

9 Summary of Goals and Resources

10 Personal Information and Summary of Financial Goals John and Jane Smith Needs Wants 7 7 Wishes 3 Retirement - Living Expense John Jane Both Retired ( ) Jane Alone Retired ( ) Health Care John Medicare / Jane Retired Before Medicare ( ) Both Medicare ( ) Jane Alone Medicare ( ) College - John Jr. 4 years starting in 2019 Attending College - Average All Travel When both are retired Recurring every year for a total of 20 times 65 / / 2025 $200,000 $175,000 Base Inflation Rate (2.00%) $16,031 $16,342 $8,171 Base Inflation Rate plus 4.50% (6.50%) $29,840 Base Inflation Rate plus 4.00% (6.00%) $15,000 Base Inflation Rate (2.00%) Leave Bequest End of Jane's plan $1,000,000 No Inflation Page 7 of 106

11 Personal Information and Summary of Financial Goals Personal Information John Male - born 02/01/1960, age 55 Employed - $250,000 Jane Female - born 05/22/1963, age 52 Employed - $250,000 Married, US Citizens living in NY This section lists the Personal and Financial Goal information you provided, which will be used to create your Report. It is important that it is accurate and complete. Participant Name Date of Birth Age Relationship John Jr. 08/07/ Child Page 8 of 106

12 Net Worth Summary - All Resources This is your Net Worth Summary as of. Your Net Worth is the difference between what you own (your Assets) and what you owe (your Liabilities). To get an accurate Net Worth statement, make certain you have entered all of your Assets and Liabilities. Investment Assets $1,913,575 Other Assets + $1,661,810 Total Assets $3,575,385 Total Liabilities - $300,000 Net Worth $3,275,385 Description Investment Assets Total Employer Retirement Plans $950,000 Individual Retirement Accounts $500,000 Taxable and/or Tax-Free Accounts $388,575 College Saving Plans $75,000 Total Investment Assets: $1,913,575 Other Assets Home and Personal Assets $750,000 Business and Property $500,000 Pension and Deferred Compensation $300,000 Cash Value Life $100,000 Stock Options $11,810 Total Other Assets: $1,661,810 Liabilities Personal Real Estate Loan: $300,000 Total Liabilities: $300,000 Net Worth: $3,275,385 Page 9 of 106

13 Net Worth Detail - All Resources This is your Net Worth Detail as of. Your Net Worth is the difference between what you own (your Assets) and what you owe (your Liabilities). To get an accurate Net Worth statement, make certain you have entered all of your Assets and Liabilities. Description Investment Assets Employer Retirement Plans John Jane's 401(k) $200,000 $200,000 John's 401(k) $750,000 $750,000 Individual Retirement Accounts Jane's Traditional IRA $500,000 $500,000 Taxable and/or Tax-Free Accounts Investment Account $388,575 $388,575 College Saving Plans 529 Savings Plan $75,000 $75,000 Total Investment Assets: $825,000 $700,000 $388,575 $1,913,575 Other Assets Home and Personal Assets Home $750,000 $750,000 Business and Property Jane Joint Jane's Practice $500,000 $500,000 Pension and Deferred Compensation Pension $300,000 $300,000 Cash Value Life John's Whole Life $100,000 $100,000 Stock Options Morgan Stanley $11,810 $11,810 Total Other Assets: $411,810 $500,000 $750,000 $1,661,810 Total Page 10 of 106

14 Net Worth Detail - All Resources Description Liabilities Personal Real Estate Loan: John Mortgage $300,000 $300,000 Total Liabilities: $0 $0 $300,000 $300,000 Net Worth: $3,275,385 Jane Joint Total Page 11 of 106

15 Resources Summary Investment Assets Description Owner Current Value Additions Assign to Goal 529 Savings Plan John $75,000 $5,000 College - John Jr. Account Total $75,000 Checking Account Custodial $75,000 Fund All Goals Taxable Account Total $75,000 Investment Account Joint Survivorship $388,575 $10,000 Fund All Goals Investments Morgan Stanley $150,000 $238,575 Jane's 401(k) Jane $200,000 $34,000 Fund All Goals Account Total $200,000 Jane's Traditional IRA Jane $500,000 Fund All Goals Account Total $500,000 John's 401(k) John $750,000 $34,000 Fund All Goals Account Total Other Assets $750,000 Total Investment Assets : $1,988,575 Description Owner Current Value Future Value Assign to Goal Home Joint Survivorship $750,000 Not Funding Goals Jane's Practice Jane $500,000 $500,000 Fund All Goals Pension John $300,000 Fund All Goals John's Whole Life John $100,000 Not Funding Goals Total of Other Assets : $1,650,000 Insurance Policies Description Owner Insured Beneficiary Annual Premium Cash Value Death Benefit Premium Paid Cash Value Life Insurance Policies Summary (included in Assets) John's Whole Life Whole Life John John Co-Client of Insured - 100% $5,000 $100,000 $1,000,000 Until Insured Dies Page 12 of 106

16 Resources Summary Insurance Policies Description Owner Insured Beneficiary Insurance Policies Summary (not included in Assets) Jane's Group Term Jane Group Term When the insured dies, the Cash Value of that policy is included in the Total Investment Assets. Social Security Annual Premium Cash Value Death Benefit Premium Paid Jane Co-Client of Insured $300, % Total Death Benefit of All Policies : Description Value Assign to Goal Social Security John will file a normal application at age 67. He will receive $33,900 in retirement benefits at age 67. Social Security Jane will file a normal application at age 67. She will receive $33,900 in retirement benefits at age 67. Retirement Income Fund All Goals Fund All Goals Description Owner Value Inflate? Assign to Goal Pension Income John $30,000 from John's Retirement to End of Plan (100% to Survivor) Liabilities No Fund All Goals Type Description Owner Outstanding Balance Interest Rate Monthly Payment $1,300,000 1st Mortgage Mortgage Joint $300, % $2,500 Total Outstanding Balance : $300,000 Page 13 of 106

17 Current Portfolio Allocation This page shows how your Investment Assets are currently allocated among the different Asset Classes. It includes only those Assets you have identified to fund Goals in this Plan. Asset Class Cash - Strategic US Large Cap Growth US Large Cap Value US Mid Cap Growth US Mid Cap Value US Small Cap Growth US Small Cap Value US Equity Other International Equity Emerging Markets Equity Global Equity Other Ultra Short Fixed Income Short Term Fixed Income US Fixed Income International Fixed Income Inflation-linked Securities Total Stock 66% Projected Assumptions Total Return 7.59% Base Inflation Rate 2.00% Real Return 5.59% Standard Deviation 12.60% Bear Market Returns Great Recession November 2007 thru February % Bond Bear Market July 1979 thru February % Investment Portfolio Rate of Return Value % of Total 1.40% $105,000 5% 8.70% $216,250 11% 8.70% $311,075 16% 9.20% $160,000 8% 9.20% $72,500 4% 9.70% 9.70% 8.70% 8.50% 9.50% 8.80% 3.00% 3.60% 4.50% 5.00% 4.40% $160,000 8% $72,500 4% $0 0% $160,000 8% $160,000 8% $0 0% $65,000 3% $160,000 8% $113,750 6% $0 0% $0 0% Page 14 of 106

18 Current Portfolio Allocation Asset Class High Yield Fixed Income Emerging Markets Fixed Income Global Fixed Income Other REITs Commodities Master Limited Partnerships Absolute Return Assets Equity Hedge Assets Equity Return Assets Opportunistic Assets Alternative Investments Other Unclassified Effect of Stock Options Value of Vested Stock Options (before tax) $11,810 Value of Portfolio with Vested Stock Options $2,000,385 Total Stock Including Stock Options 66% Tax-Free Rates of Return Cash - Strategic Ultra Short Fixed Income Short Term Fixed Income US Fixed Income High Yield Fixed Income 1.00% 2.10% 2.80% 3.00% 6.10% Rate of Return 8.00% 6.00% 4.40% 7.80% 4.30% 11.30% 5.20% 5.00% 6.60% 10.00% 5.80% 0.00% Value Investment Portfolio $0 $0 $0 $87,500 $72,500 $72,500 $0 $0 $0 $0 $0 $0 % of Total 0% 0% 0% 4% 4% 4% 0% 0% 0% 0% 0% 0% Total : $1,988, % Page 15 of 106

19 Current Portfolio Allocation Concentrated Positions Security Symbol Name Total Value % of Total Assets MS Morgan Stanley $238,575 12% Morgan Stanley $11,810 1% Total Holding for MS $250,385 13% Page 16 of 106

20 Target Band The Risk-Based Portfolio was selected from this list of Model Portfolios, based upon the answers you provided in your Risk Tolerance Questionnaire. The Target Portfolio was selected based on your investment objectives and risk tolerance. The Target Portfolio will be the same as the Risk Based Portfolio unless you choose a Custom Portfolio or Model Portfolio. The Average Real Return is equal to the Average Total Return minus the inflation rate of 2.00%. Current Risk Based Return vs. Risk Graph Target Band Name Cash Bond Stock Alternative Average Return Total Real Standard Deviation Model 1 - Capital Preservation 0% 69% 24% 7% 5.51% 3.51% 5.50% Model 2 - Income 0% 54% 36% 10% 6.23% 4.23% 7.51% Model 3 - Balanced Growth 0% 34% 52% 14% 7.00% 5.00% 10.01% Current 5% 17% 66% 12% 7.59% 5.59% 12.60% Model 4 - Market Growth 0% 18% 66% 16% 7.71% 5.71% 12.52% Model 5 - Opportunistic Growth 0% 0% 80% 20% 8.40% 6.40% 14.94% When deciding how to invest your money, you must determine the amount of risk you are willing to assume to pursue a desired return. The Return versus Risk Graph reflects a set of portfolios that assume a low relative level of risk for each level of return, or conversely an optimal return for the degree of investment risk taken. The graph also shows the position of the Current, Target, Risk-Based, and Custom Portfolios. The positioning of these portfolios illustrates how their respective risks and returns compare to each other as well as the optimized level of risk and return represented by the Portfolios. This graph shows the relationship of return and risk for each Portfolio in the chart above. Page 17 of 106

21 Results

22 What If Worksheet This Worksheet allows you to analyze and compare the results of one or more scenarios that you created by varying the Plan assumptions. Estimated % of Goal Funded Current Scenario Needs Save More/Ret Later Bad Timing Average Return Bad Timing Average Return Bad Timing Average Return Bad Timing 100% 100% 100% 100% 100% 100% 100% 100% 100% 60% 100% 100% 0% 7 Travel Wishes 3 Leave Bequest Safety Margin (Value at End of Plan) $3,268 Future dollars (in thousands) : $7,216 Monte Carlo Results Your Confidence Zone: 70% - 90% Total Spending : $7,959, % 100% 100% 100% 100% 100% 100% 100% 100% $0 $5,199 $2,423 $5,015 $1,955 $5,163 $2,382 $0 $11,480 $5,350 $11,073 $4,316 $11,400 $5,259 SA Current dollars (in thousands) : 100% M College - John Jr. 100% PL 10 Health Care 7 Ret Later/Spend Less Average Return 10 Retirement Wants Save More/Spend Less E Goals Likelihood of Funding All Goals $7,743,135 $7,649,165 $7,443,135 Indicates different data between the Scenario in the first column and the Scenario in any other column. Page 18 of 106

23 What If Worksheet Key Assumptions Current Scenario Save More/Ret Later Save More/Spend Less Ret Later/Spend Less Stress Tests Method(s) Bad Timing Program Estimate Years of bad returns: 2025: % 2026: -5.01% Bad Timing Program Estimate Years of bad returns: 2026: % 2027: -4.81% Bad Timing Program Estimate Years of bad returns: 2025: % 2026: -4.81% Bad Timing Program Estimate Years of bad returns: 2026: % 2027: -4.81% Funding Order Assets - Ignore Earmarks No No No No Retirement Income - Ignore Earmarks No No No No Hypothetical Average Rate of Return Before Retirement : Current 4 - Mkt Growth 4 - Mkt Growth 4 - Mkt Growth Total Return : 7.59% 7.71% 7.71% 7.71% Standard Deviation : 12.60% 12.52% 12.52% 12.52% Total Return Adjustment : 0.00% 0.00% 0.00% 0.00% Adjusted Real Return : 5.59% 5.71% 5.71% 5.71% After Retirement : Current 4 - Mkt Growth 4 - Mkt Growth 4 - Mkt Growth Total Return : 7.59% 7.71% 7.71% 7.71% Standard Deviation : 12.60% 12.52% 12.52% 12.52% Total Return Adjustment : 0.00% 0.00% 0.00% 0.00% Adjusted Real Return : 5.59% 5.71% 5.71% 5.71% Base inflation rate : 2.00% 2.00% 2.00% 2.00% Tax-Free Options Before Retirement Reallocate a portion of bonds to tax-free: No No No No Percent of bond allocation to treat as tax-free: 0.00% 0.00% 0.00% 0.00% After Retirement Reallocate a portion of bonds to tax-free: No No No No Percent of bond allocation to treat as tax-free: 0.00% 0.00% 0.00% 0.00% Indicates different data between the Scenario in the first column and the Scenario in any other column. Page 19 of 106

24 What If Worksheet Key Assumptions Current Scenario Save More/Ret Later Save More/Spend Less Ret Later/Spend Less Goals Living Expense Retirement Age John Jane Planning Age John Jane One Retired John Retired and Jane Employed $132,000 $132,000 $132,000 $132,000 Jane Retired and John Employed $132,000 $132,000 $132,000 $132,000 Both Retired Both Retired $200,000 $200,000 $190,000 $190,000 One Alone - Retired Jane Alone Retired $175,000 $175,000 $165,000 $165,000 John Alone Retired $175,000 $175,000 $165,000 $165,000 One Alone - Employed John Alone Employed $132,000 $132,000 $132,000 $132,000 Jane Alone Employed $132,000 $132,000 $132,000 $132,000 Health Care Cost determined by Schedule : See details See details See details See details College - John Jr. Year : Years of Education : Annual Cost : $29,840 $29,840 $29,840 $29,840 Travel Year : When both are retired When both are retired When both are retired When both are retired Cost : $15,000 $15,000 $15,000 $15,000 Is recurring : Yes Yes Yes Yes Indicates different data between the Scenario in the first column and the Scenario in any other column. Page 20 of 106

25 What If Worksheet Key Assumptions Current Scenario Save More/Ret Later Save More/Spend Less Ret Later/Spend Less Goals Years between occurrences : Number of occurrences : Leave Bequest Cost : $1,000,000 $1,000,000 $1,000,000 $1,000,000 Retirement Income Pension Income (John) Annual Income : $30,000 $30,000 $30,000 $30,000 Start Year : John's retirement John's retirement John's retirement John's retirement Select when income will end : End of Plan End of Plan End of Plan End of Plan Year to end retirement income : Survivor Benefit : 100% 100% 100% 100% Social Security Select Social Security Strategy At FRA At FRA At FRA At FRA John Filing Method : Normal Normal Normal Normal Age to File Application : Age Retirement Benefits begin : First Year Benefit : $33,900 $33,932 $33,900 $33,932 Jane Filing Method : Normal Normal Normal Normal Age to File Application : Age Retirement Benefits begin : First Year Benefit : $33,900 $33,932 $33,900 $33,932 Reduce Benefits By : 0% 0% 0% 0% Indicates different data between the Scenario in the first column and the Scenario in any other column. Page 21 of 106

26 What If Worksheet Key Assumptions Current Scenario Save More/Ret Later Save More/Spend Less Ret Later/Spend Less Asset Additions John's 401(k) Maximum Maximum Maximum Maximum Roth: N/A N/A N/A N/A Maximum contribution each year: Yes Yes Yes Yes % Designated as Roth: 0.00% 0.00% 0.00% 0.00% Plan addition amount: $34,000 $34,000 $34,000 $34,000 Year additions begin: John - Fund All Goals Jane's 401(k) Maximum Maximum Maximum Maximum Roth: N/A N/A N/A N/A Maximum contribution each year: Yes Yes Yes Yes % Designated as Roth: 0.00% 0.00% 0.00% 0.00% Plan addition amount: $34,000 $34,000 $34,000 $34,000 Year additions begin: Jane - Fund All Goals Investment Account After-Tax Addition: $10,000 $10,000 $10,000 $10,000 Tax-Free Addition: $0 $0 $0 $0 Year additions begin: Joint - Fund All Goals 529 Savings Plan After-Tax Addition: $5,000 $5,000 $5,000 $5,000 Year additions begin: John - College - John Jr. Indicates different data between the Scenario in the first column and the Scenario in any other column. Page 22 of 106

27 What If Worksheet Key Assumptions Current Scenario Save More/Ret Later Save More/Spend Less Ret Later/Spend Less Extra Savings by Tax Category John's Qualified $0 $0 $0 Jane's Qualified $0 $0 $0 John's Roth $0 $0 $0 Jane's Roth $0 $0 $0 John's Tax-Deferred $0 $0 $0 Jane's Tax-Deferred $0 $0 $0 Taxable $20,000 $20,000 $0 Stock Options Morgan Stanley Include in plan : Yes Yes Yes Yes Stock Options Scenario : Scenario 1 Scenario 1 Scenario 1 Scenario 1 Vesting Termination Year : Return : 8.70% 8.70% 8.70% 8.70% Other Assets Jane's Practice Include in Plan : Yes Yes Yes Yes Select special amount : Expected Expected Expected Expected When received : Jane's retirement Jane's retirement Jane's retirement Jane's retirement Amount of cash received : $500,000 $500,000 $500,000 $500,000 Pension Include in Plan : Yes Yes Yes Yes When received : John's retirement John's retirement John's retirement John's retirement Amount of cash received : $0 $0 $0 $0 Indicates different data between the Scenario in the first column and the Scenario in any other column. Page 23 of 106

28 What If Worksheet Key Assumptions Current Scenario Save More/Ret Later Save More/Spend Less Ret Later/Spend Less Tax Options Include Tax Penalties : Yes Yes Yes Yes Change Tax Rate? No No No No Year To Change : Change Tax Rate by this % (+ or -) : 0.00% 0.00% 0.00% 0.00% Indicates different data between the Scenario in the first column and the Scenario in any other column. Page 24 of 106

29 Worksheet Detail - Combined Details Scenario : Save More/Ret Later using Average Returns These pages provide a picture of how your Investment Portfolio may hypothetically perform over the life of this Plan. The graph shows the effect on the value of your Investment Portfolio for each year. The chart shows the detailed activities that increase and decrease your Investment Portfolio value each year including the funds needed to pay for each of your Goals. Shortfalls that occur in a particular year are denoted with an 'X' under the Goal column. Total Portfolio Value Graph x - denotes shortfall Page 25 of 106

30 Worksheet Detail - Combined Details Scenario : Save More/Ret Later using Average Returns Event or Ages Year Beginning Portfolio Value Earmarked Fund All Goals Additions To Assets Other Additions Stock Options Post Investment Retirement Earnings Income Taxes Funds Used All Goals Ending Portfolio Value 56 / ,000 1,913, , ,260 15, ,237, / ,168 2,151, , , ,143 17, ,540, / ,197 2,442, , , ,756 20, ,854, / ,154 2,742, , , ,410 23,064 35,540 3,153, / ,443 3,072, , , ,937 26,185 37,672 3,479, / ,146 3,432, , ,211 28,321 39,933 3,788, / ,769 3,780, , ,964 29,496 42,329 4,119, / ,119, , ,834 31, ,520, / ,520, , ,942 34, ,952, / ,952, , ,377 36, ,416,950 John & Jane ,416, , , ,928 22, ,176 6,068,574 Retire 67 / ,068, , ,871 29, ,374 6,261, / ,261, , ,195 26, ,465 6,465, / ,465, , ,391 21, ,180 6,681, / ,681, , ,208 63, ,151 6,911, / ,911, , ,216 63, ,390 7,150, / ,150, , ,981 63, ,909 7,401, / ,401, , , , ,721 7,615, / ,615, , , , ,841 7,831, / ,831, , , , ,282 8,049, / ,049, , , , ,061 8,267, / ,267, , , , ,193 8,484, / ,484, , , , ,697 8,700, / ,700, , , , ,590 8,913, / ,913, , , , ,892 9,122, / ,122, , , , ,623 9,326, / ,326, , , , ,806 9,522, / ,522, , , , ,463 9,709, / ,709, , , , ,619 9,885,221 x - denotes shortfall Page 26 of 106

31 Worksheet Detail - Combined Details Scenario : Save More/Ret Later using Average Returns Event or Ages Year Beginning Portfolio Value Earmarked Fund All Goals Additions To Assets Other Additions Stock Options Post Investment Retirement Earnings Income Taxes Funds Used All Goals Ending Portfolio Value 85 / ,885, , , , ,299 10,047, / ,047, , , , ,362 10,223, / ,223, , , , ,633 10,383, / ,383, , , , ,506 10,525, / ,525, , , , ,013 10,646,401 John's Plan Ends ,646, , , , ,189 10,744,088 - / ,744, ,000, , , , ,027 11,941,219 - / ,941, , , , ,840 12,118,748 - / ,118, , , , ,105 12,277,060 - / ,277, , , , ,846 12,413,825 Jane's Plan Ends ,413, , , ,299 1,474,088 11,480,265 x - denotes shortfall Page 27 of 106

32 Worksheet Detail - Combined Details Scenario : Save More/Ret Later using Average Returns Event or Ages Year Funds Used Retirement Health Care College - John Jr. Travel Leave Bequest Ending Portfolio Value 56 / ,237, / ,540, / ,854, / , ,153, / , ,479, / , ,788, / , ,119, / ,520, / ,952, / ,416,950 John & Jane ,799 30, , ,068,574 Retire 67 / ,675 32, , ,261, / ,648 34, , ,465, / ,721 37, , ,681, / ,896 39, , ,911, / ,174 42, , ,150, / ,557 44, , ,401, / ,048 47, , ,615, / ,649 50, , ,831, / ,362 54, , ,049, / ,189 57, , ,267, / ,133 61, , ,484, / ,196 65, , ,700, / ,380 69, , ,913, / ,687 74, , ,122, / ,121 78, , ,326, / ,684 84, , ,522, / ,377 89, , ,709,526 x - denotes shortfall Page 28 of 106

33 Worksheet Detail - Combined Details Scenario : Save More/Ret Later using Average Returns Event or Ages Year Funds Used Retirement Health Care College - John Jr. Travel Leave Bequest Ending Portfolio Value 84 / ,205 95, , ,885, / , , , ,047, / , , ,223, / , , ,383, / , , ,525, / , , ,646,401 John's Plan Ends , , ,744,088 - / ,981 74, ,941,219 - / ,980 78, ,118,748 - / ,120 83, ,277,060 - / ,402 89, ,413,825 Jane's Plan Ends ,830 95, ,000,000 11,480,265 x - denotes shortfall Page 29 of 106

34 Worksheet Detail - Combined Details Notes IMPORTANT: The projections or other information generated by this tool regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. Results may vary with use and over time. The return assumptions used are estimates based on average annual returns for the index used as a proxy for each asset class. The portfolio returns were calculated by weighting individual return assumptions for each asset class according to the portfolio allocation selected by you or your Financial Advisor. The portfolio returns may have also been modified by your Financial Advisor to reflect the outcome of a different return by conducting a Total Return Adjustment or selecting a Custom Portfolio. For a explanation of the methodology used to calculate returns, please review the Important Disclosure Information and Return Methodology sections. The return assumptions in this tool are not reflective of any specific product and do not include any fees or expenses that may be incurred by investing in specific products. The actual returns of a specific product may be more or less than the returns used in this tool. No investment strategy or allocation can eliminate risk or guarantee investment results. Additions and withdrawals occur at the beginning of the year. Other Additions come from items entered in the Other Assets section and any applicable proceeds from insurance policies. Stock Options and Restricted Stock values are after-tax and based on the Exercise Scenario selected. Strategy Income is based on the particulars of the Goal Strategies selected. Strategy Income from immediate annuities and 72(t) distributions is pre-tax. Strategy Income from Net Unrealized Appreciation (NUA) is after-tax. Post Retirement Income includes the following: Social Security, pension, annuity, rental property, royalty, alimony, part-time employment, trust, and any other retirement income as entered in the Plan. For married clients, if either Social Security Program Estimate or Use This Amount and Evaluate Annually is selected for a participant, the Program defaults to the greater of the selected benefit or the age-adjusted spousal benefit based on the other participant s benefit. The spousal benefit is not applicable to domestic partners. Investment Earnings are calculated on all assets after any withdrawals for 'Goal Expense', 'Taxes on Withdrawals' and 'Tax Penalties' are subtracted. The taxes column is a sum of (1) taxes on retirement income, (2) taxes on strategy income, (3) taxes on withdrawals from qualified assets for Required Minimum Distributions, (4) taxes on withdrawals from taxable assets' untaxed gain used to fund Goals in that year, (5) taxes on withdrawals from tax-deferred or qualified assets used to fund goals in that year, and (6) taxes on the investment earnings of taxable assets. Tax rates used are detailed in the Tax and Inflation Options page. (Please note, the Taxes column does not include any taxes owed from the exercise of Stock Options or the vesting of Restricted Stock.) Tax Penalties can occur when Qualified and Tax-Deferred Assets are used prior to age 59½. If there is a value in this column, it illustrates that you are using your assets in this Plan in a manner that may incur tax penalties. Generally, it is better to avoid tax penalties whenever possible. These calculations do not incorporate penalties associated with use of 529 Plan withdrawals for non-qualified expenses. Funds for each Goal Expense are used first from Earmarked Assets. If sufficient funds are not available from Earmarked Assets, Fund All Goals Assets will be used to fund the remaining portion of the Goal Expense, if available in that year. All funds needed for a Goal must be available in the year the Goal occurs. Funds from Earmarked Assets that become available after the goal year(s) have passed are not included in the funding of that Goal, and accumulate until the end of the Plan. For married clients, ownership of qualified assets is assumed to roll over to the surviving co-client at the death of the original owner. For domestic partners, qualified assets are assumed to be transferred as a non-spousal inheritance to the surviving co-client at the death of the original owner. In both cases, the Program assumes the surviving co-client inherits all remaining assets of the original owner. x - denotes shortfall Page 30 of 106

35 Worksheet Detail - Health Care Expense Schedule Scenario : Save More/Ret Later Year Age/Event John Private Insurance Prior to Medicare Medicare Part B Medicare Part D Medigap Policy John's Total Private Insurance Prior to Medicare Medicare Part B Medicare Part D Jane Medigap Policy 2026 John retires and $0 $3,841 $1,451 $6,555 $3,491 $15,338 $11,263 $0 $0 $0 $3,491 $14,754 $30,092 starts Medicare, Jane retires /64 $0 $4,090 $1,545 $6,981 $3,718 $16,335 $11,995 $0 $0 $0 $3,718 $15,713 $32, Jane starts $0 $4,356 $1,645 $7,435 $3,960 $17,397 $0 $4,356 $1,645 $7,435 $3,960 $17,397 $34,793 Medicare /66 $0 $4,639 $1,752 $7,918 $4,218 $18,527 $0 $4,639 $1,752 $7,918 $4,218 $18,527 $37, /67 $0 $4,941 $1,866 $8,433 $4,492 $19,732 $0 $4,941 $1,866 $8,433 $4,492 $19,732 $39, /68 $0 $5,262 $1,988 $8,981 $4,784 $21,014 $0 $5,262 $1,988 $8,981 $4,784 $21,014 $42, /69 $0 $5,604 $2,117 $9,565 $5,095 $22,380 $0 $5,604 $2,117 $9,565 $5,095 $22,380 $44, /70 $0 $5,968 $2,254 $10,186 $5,426 $23,835 $0 $5,968 $2,254 $10,186 $5,426 $23,835 $47, /71 $0 $6,356 $2,401 $10,848 $5,778 $25,384 $0 $6,356 $2,401 $10,848 $5,778 $25,384 $50, /72 $0 $6,769 $2,557 $11,554 $6,154 $27,034 $0 $6,769 $2,557 $11,554 $6,154 $27,034 $54, /73 $0 $7,209 $2,723 $12,305 $6,554 $28,791 $0 $7,209 $2,723 $12,305 $6,554 $28,791 $57, /74 $0 $7,678 $2,900 $13,104 $6,980 $30,663 $0 $7,678 $2,900 $13,104 $6,980 $30,663 $61, /75 $0 $8,177 $3,089 $13,956 $7,434 $32,656 $0 $8,177 $3,089 $13,956 $7,434 $32,656 $65,311 Out-of- Pocket Out-of- Pocket Jane's Total Annual Total Page 31 of 106

36 Worksheet Detail - Health Care Expense Schedule Scenario : Save More/Ret Later Year Age/Event John Private Insurance Prior to Medicare Medicare Part B Medicare Part D Medigap Policy Out-of- Pocket John's Total Private Insurance Prior to Medicare Medicare Part B Medicare Part D Jane Medigap Policy /76 $0 $8,709 $3,290 $14,863 $7,917 $34,778 $0 $8,709 $3,290 $14,863 $7,917 $34,778 $69, /77 $0 $9,275 $3,503 $15,829 $8,431 $37,039 $0 $9,275 $3,503 $15,829 $8,431 $37,039 $74, /78 $0 $9,877 $3,731 $16,858 $8,980 $39,446 $0 $9,877 $3,731 $16,858 $8,980 $39,446 $78, /79 $0 $10,520 $3,974 $17,954 $9,563 $42,010 $0 $10,520 $3,974 $17,954 $9,563 $42,010 $84, /80 $0 $11,203 $4,232 $19,121 $10,185 $44,741 $0 $11,203 $4,232 $19,121 $10,185 $44,741 $89, /81 $0 $11,931 $4,507 $20,364 $10,847 $47,649 $0 $11,931 $4,507 $20,364 $10,847 $47,649 $95, /82 $0 $12,707 $4,800 $21,688 $11,552 $50,746 $0 $12,707 $4,800 $21,688 $11,552 $50,746 $101, /83 $0 $13,533 $5,112 $23,097 $12,303 $54,045 $0 $13,533 $5,112 $23,097 $12,303 $54,045 $108, /84 $0 $14,413 $5,444 $24,599 $13,102 $57,558 $0 $14,413 $5,444 $24,599 $13,102 $57,558 $115, /85 $0 $15,349 $5,798 $26,198 $13,954 $61,299 $0 $15,349 $5,798 $26,198 $13,954 $61,299 $122, /86 $0 $16,347 $6,175 $27,900 $14,861 $65,284 $0 $16,347 $6,175 $27,900 $14,861 $65,284 $130, John's plan ends $0 $17,410 $6,576 $29,714 $15,827 $69,527 $0 $17,410 $6,576 $29,714 $15,827 $69,527 $139, /88 $0 $0 $0 $0 $0 $0 $0 $18,541 $7,004 $31,645 $16,856 $74,046 $74, /89 $0 $0 $0 $0 $0 $0 $0 $19,747 $7,459 $33,702 $17,951 $78,859 $78, /90 $0 $0 $0 $0 $0 $0 $0 $21,030 $7,944 $35,893 $19,118 $83,985 $83, /91 $0 $0 $0 $0 $0 $0 $0 $22,397 $8,460 $38,226 $20,361 $89,444 $89, Jane's plan ends $0 $0 $0 $0 $0 $0 $0 $23,853 $9,010 $40,711 $21,684 $95,258 $95,258 Total Lifetime Cost of Health Care $903,207 $1,323,595 Out-of- Pocket Jane's Total Annual Total Page 32 of 106

37 Worksheet Detail - Health Care Expense Schedule Scenario : Save More/Ret Later Notes Program assumptions: The scenario assumes that client and co-client will each use a combination of Medicare Part A (Hospital Insurance), Part B (Medical Insurance), Part D (Prescription Drug Insurance), Medigap insurance, and Out-of Pocket expenses. The program uses initial default values that may have been adjusted based on your preferences and information provided by you. The scenario assumes that client and co-client each qualify to receive Medicare Part A at no charge and therefore it is not reflected in the Health Care Expense schedule. Estimates for private insurance prior to retirement are based on the information you provided. Medicare and Medigap costs begin at the later of age 65, your retirement age, or the current year. All costs are in future dollars. Costs associated with Long Term Care needs are not addressed by this goal. A separate LTC goal can be created. General Information regarding Medicare: Part B premiums are uniform nationally and are increased for those with a higher Modified Adjusted Gross Income. Part D coverage is optional. Premiums are increased for those with a higher Modified Adjusted Gross Income, differ from state to state, and vary based on the specific plan and level of benefit selected. Medigap coverage is optional and policies (Plans A-N) are issued by private insurers. Clients may incur out-of-pocket healthcare expenses, for costs not covered by Medicare benefits and Medigap insurance. If clients retire before age 65, they may choose to purchase private health insurance or to self-insure. Costs and coverage for private health insurance varies greatly. Page 33 of 106

38 Worksheet Detail - Inside the Numbers Final Result The graph below shows the results for all 1000 Monte Carlo Trials. The Probability of Success meter displays the percentage of trials that were successful in funding all of your goals. We identify the Confidence Zone as a probability of Success between 70% and 90%. In the table below, the Best, 25th percentile, 50th percentile, 75th percentile, and Worst trials are ranked based on the End of Plan Value. For each trial displayed, the corresponding portfolio value is illustrated for specific years of the plan. These years serve as checkpoints to illustrate how the portfolio might perform over the life of the plan. Inside the Numbers - Final Result For Save More/Ret Later (70% - 90%) Although the graph and table help illustrate a general range of results you may expect, neither of them reflect the Final Results, your Probability of Success. Trials Year 5 Year 10 Year 15 Year 20 Year 25 End of Plan Year Money Goes to $0 Best $4,068,531 $6,319,172 $11,329,717 $19,067,989 $32,615,213 $103,702,288 25th $4,235,398 $11,273,478 $12,725,817 $14,450,232 $17,487,073 $25,763,480 50th $2,945,855 $5,461,025 $8,019,084 $11,188,429 $10,247,246 $13,966,467 75th $4,264,661 $9,195,867 $6,616,289 $6,872,823 $5,590,812 $3,582,661 Worst $4,080,220 $4,953,152 $4,796,604 $1,597,575 $0 $ Page 34 of 106

39 Worksheet Detail - Allocation Comparison Scenario: Save More/Ret Later These charts compare your Current Portfolio with the Target Portfolio you selected and show the allocation changes you should consider. Current Portfolio Current Amount % of Total Projected Assumptions 7.59% Total Return 7.71% 2.00% Base Inflation Rate 2.00% 5.59% Real Return 5.71% 12.60% Standard Deviation 12.52% Bear Market Returns -33% Great Recession -34% 11% Bond Bear Market 12% Portfolio Comparison with Allocation Changes Asset Class % of Total Target Amount Target Portfolio Model 4 - Market Growth Increase / Decrease $105,000 5% Cash - Strategic 0% $0 -$105,000 $216,250 11% US Large Cap Growth 12% $238,629 $22,379 $311,075 16% US Large Cap Value 12% $238,629 -$72,446 $160,000 8% US Mid Cap Growth 2% $39,772 -$120,229 $72,500 4% US Mid Cap Value 2% $39,772 -$32,729 $160,000 8% US Small Cap Growth 2% $39,772 -$120,229 $72,500 4% US Small Cap Value 2% $39,772 -$32,729 $0 0% US Equity Other 0% $0 $0 $160,000 8% International Equity 26% $517,030 $357,030 $160,000 8% Emerging Markets Equity 8% $159,086 -$914 $0 0% Global Equity Other 0% $0 $0 $65,000 3% Ultra Short Fixed Income 2% $39,772 -$25,229 $160,000 8% Short Term Fixed Income 6% $119,315 -$40,686 $113,750 6% US Fixed Income 6% $119,315 $5,565 $0 0% International Fixed Income 2% $39,772 $39,772 Page 35 of 106

40 Worksheet Detail - Allocation Comparison Scenario: Save More/Ret Later Portfolio Comparison with Allocation Changes Current Amount % of Total Asset Class % of Total Target Amount Increase / Decrease $0 0% Inflation-linked Securities 0% $0 $0 $0 0% High Yield Fixed Income 2% $39,772 $39,772 $0 0% Emerging Markets Fixed Income 0% $0 $0 $0 0% Global Fixed Income Other 0% $0 $0 $87,500 4% REITs 2% $39,772 -$47,729 $72,500 4% Commodities 0% $0 -$72,500 $72,500 4% Master Limited Partnerships 2% $39,772 -$32,729 $0 0% Absolute Return Assets 1% $19,886 $19,886 $0 0% Equity Hedge Assets 4% $79,543 $79,543 $0 0% Equity Return Assets 7% $139,200 $139,200 $0 0% Opportunistic Assets 0% $0 $0 $0 0% Alternative Investments Other 0% $0 $0 $0 0% Unclassified 0% $0 $0 $1,988,575 $1,988,575 $0 Page 36 of 106

41 Worksheet Detail - Bear Market Test Bear Market Test for Save More/Ret Later Likelihood of Reaching Goals After Loss of 34% - Using All Assets to Fund Goals by Importance Needs and Wants Only Needs, Wants, and Wishes PL E Needs Only 10 - Retirement - Living Expense 10 - Health Care Wants 7 - College - John Jr. 7 - Travel Wishes 3 - Leave Bequest SA Needs M Goals This test assumes your investment allocation matches the Model 4 - Market Growth portfolio. If your investments suffered a loss of 34% this year, your portfolio value would be reduced by $676,116. This is the approximate loss sustained by a portfolio with a similar percentage of stocks, bonds, cash, and alternative during the Great Recession, which lasted from November 2007 through February These results show the likelihood you would be able to fund your Needs, Wants and Wishes after experiencing this loss. Page 37 of 106

42 Worksheet Detail - Special Asset Test Special Asset Test for Save More/Ret Later Likelihood of Funding Goals Expected High Description When Sold Jane's retirement Future Amounts Low Expected High $250,000 $500,000 $1,000,000 SA Jane's Practice M PL E Low It is often difficult to predict the value that will be received from the sale of assets in the future. This creates a hidden risk to your plan. These results show your Probability of Success using the three estimates you provided for the amount of after-tax cash you might receive from the sale of each Special Asset shown in the table. For each result calculated, all assets are assumed to receive the Low, Expected or High amount. All other assumptions in the plan remain unchanged. There is a Risk that you will receive the Low values (or less than the Low values). If this causes your Probability of Success to fall below your Confidence Zone, you should consider what adjustments might be necessary. Page 38 of 106

43 Worksheet Detail - Concentrated Position Test Are You Taking a Greater Risk Than You Realize? Concentrated Position Test for Save More/Ret Later When you have over 10% of your portfolio invested in single securities (i.e. stocks, including restricted stock and stock options, or bonds), it is treated in this analysis as a Concentrated Position. The information you provided indicates you have a Concentrated Position, as shown below. Holding a Concentrated Position subjects you to investment risk that is not reflected in the volatility assumptions used in your Plan. While the returns for a well-diversified portfolio will usually move up and down with the economy and market in general, your investment in any single stock or bond could suddenly lose most, or even all, of its value, often with little or no warning, due to factors unique to that specific security. The purpose of this analysis is to demonstrate what it would mean to your Plan if a security in which you have a Concentrated Position suddenly lost 50% or 75% of its value. Could you still attain your Goals, or are you putting your future at risk? You have $250,385 invested in MS. If it suffered a major loss, how would it affect the Probability of Success for your Goals? Security Symbol MS Value $250,385 % of Portfolio 12.52% Additional Employment Risk If you have a Concentrated Position in the stock of the company where you are employed, you have even more risk. If your employer gets into trouble, not only will the value of your stock fall, you also could lose your source of income. Additional Concentration Results after 50% Loss Results after 75% Loss Individual securities positions held within mutual funds or variable annuity subaccounts are not considered in this analysis. If you own mutual funds or subaccounts containing this security, your concentrated position and risk of loss are higher than indicated in this analysis. Page 39 of 106

44 Worksheet Detail - Portfolio Probability Matrix Portfolio Probability Matrix for Save More/Ret Later Risk Based Portfolio Portfolio used in Save More/Ret Later Both before and during Retirement with same portfolio Probability of Success Results Safety Margin (Current Dollars) Great Recession Return Bear Market Loss Bond Bear Market Return Model 1 - Capital Preservation 50% $0-3% -1% Model 2 - Income 71% $1,011,214-12% 3% Model 3 - Balanced Growth 79% $3,186,739-24% 8% Current 81% $4,827,416-33% 11% Model 4 - Market Growth 82% $5,199,302-34% 12% Model 5 - Opportunistic Growth 83% $7,638,617-45% 16% Page 40 of 106

45 Worksheet Detail - Social Security Maximization Social Security Maximization for Save More/Ret Later Social Security Strategy Start age John Jane First year benefit in current dollars John Jane Maximization Based on Cash Received Total lifetime benefit in current dollars Break Even Point John Jane Maximization Based on Overall Result Selected Strategy $33,932 $33,932 As Soon As Possible $0 $0 At Retirement At FRA At Age $31,670 $25, $33,932 $33, $42,076 $42,076 John begins at age 70 and Jane begins at FRA $42,076 $33,932 Maximized Benefit $42,076 $42,076 $1,696,620 $1,306,397 $1,586,340 $1,696,620 $1,851,352 $1,806,561 $1,851, N/A N/A Probability of success 82% 79% 82% 82% 82% 82% 82% Page 41 of 106

46 Worksheet Detail - Social Security Maximization Notes Selected Strategy: This is the strategy you selected. At FRA: You apply for and begin retirement benefits at your Full Retirement Age (FRA), which is determined by your date of birth. If the retirement age you specified is after your FRA, we assume you will begin benefits at FRA, and we will adjust the benefit for inflation until your retirement age. At Retirement: You apply for and begin retirement benefits at the retirement age shown. The benefit is automatically adjusted to account for excess earnings from part-time work and/or taking benefits prior to your FRA, if either is applicable. As soon as possible: You apply for and begin benefits at the later of your current age or age 62. The benefit is automatically adjusted to account for excess earnings from part-time work, if applicable, and taking benefits prior to your FRA. If you are age 62 or older, this option is not available. At age 70: You apply for and begin benefits at age 70. (Higher Wage Earner) begins at age 70 and (Lower Wage Earner) begins at FRA: This strategy is available only if you are married. The higher wage earner applies for and begins benefits at age 70. The lower wage earner applies for and begins benefits at his/her FRA. The higher/lower wage earners are determined based on the employment incomes you specified. (Higher Wage Earner) files/suspends and (Lower Wage Earner) restricted application: This strategy is available only if you are married. The higher wage earner applies for and suspends taking benefits until age 70. The higher wage earner can file at or after his/her FRA, at which time the spouse (the lower wage earner) files for and takes spousal benefits. The spouse then files for and begins his/her own benefit at age 70, at the higher benefit amount. Social Security Maximization for Save More/Ret Later The lower wage earner makes a restricted application at his/her FRA. Restricted application allows the account holder to apply only for the "spousal benefit" s/he would be due under dual entitlement rules. At any age beyond his/her FRA, the lower wage earner can apply for and receive benefits based on his/her own work history. (Lower Wage Earner) files/suspends and (Higher Wage Earner) restricted application: This strategy is available only if you are married. The lower wage earner applies for and suspends taking benefits until age 70. The lower wage earner can file at or after his/her FRA, at which time the spouse (the higher wage earner) files for and takes spousal benefits. The spouse then files for and begins his/her own benefit at age 70, at the higher benefit amount. The higher wage earner makes a restricted application at his/her FRA. Restricted application allows the account holder to apply only for the "spousal benefit" s/he would be due under dual entitlement rules. At any age beyond his/her FRA, the higher wage earner can apply for and receive benefits based on his/her own work history. Maximized Benefits: This is the strategy that provides the highest estimate of lifetime Social Security income, assuming you live to the age(s) shown on the Detailed Results page. Total Lifetime Benefit: The total estimate of benefits you and your co-client, if applicable, would receive in your lifetime, assuming you live to the age(s) shown on the Detailed Results page. This amount is in current (non-inflated) dollars. Break Even Point: The age(s) at which this strategy would provide benefits equivalent to the As Soon As Possible strategy. If you live longer than the break even age for a strategy, your total lifetime benefits using that strategy would be greater than the lifetime benefits of the As Soon As Possible strategy. If you are older than age 62 and the As Soon As Possible strategy is not shown, the break even comparison uses the strategy that begins at the earliest age(s) as the baseline for comparison. Page 42 of 106

47 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Year Age (John / Jane) Retirement and Strategy Income Assign To / / 64 Pension Income Fund All Goals 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 Social Security - John Fund All Goals 0 42,191 43,034 43,895 44,773 45,669 46,582 47,514 Social Security - Jane Fund All Goals ,773 45,669 46,582 47,514 Total Retirement and Strategy Income 30,000 72,191 73,034 73, , , , ,027 Other Additions Assign To Jane's Practice Fund All Goals 500, John's Whole Life Fund All Goals Total Other Additions 500, Investment Earnings 435, , , , , , , ,429 Total Income and Earnings 965, , , , , , , ,456 Cash Used To Fund Goals Estimated % Funded Retirement - Living Expense 100% 243, , , , , , , ,048 Health Care 100% 30,092 32,048 34,793 37,055 39,463 42,028 44,760 47,669 Travel 100% 18,285 18,651 19,024 19,404 19,792 20,188 20,592 21,004 Leave Bequest 100% Total Goal Funding (292,176) (299,374) (307,465) (315,180) (323,151) (331,390) (339,909) (348,721) Total Taxes and Tax Penalty (22,129) (29,648) (26,045) (21,460) (63,222) (63,560) (63,935) (108,589) Cash Surplus/Deficit (Net Change in Portfolio) 651, , , , , , , , / / / 67 Portfolio Value Future Dollars Beginning Value 5,416,950 6,068,574 6,261,614 6,465,333 6,681,979 6,911,360 7,150,963 7,401,265 Cash Surplus/Deficit 651, , , , , , , ,146 Investment Asset Additions Ending Value 6,068,574 6,261,614 6,465,333 6,681,979 6,911,360 7,150,963 7,401,265 7,615, / / / 70 Page 43 of 106

48 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Year Age (John / Jane) Current Dollars / / / 65 Ending Value 4,880,729 4,937,240 4,997,913 5,064,105 5,135,242 5,209,089 5,285,706 5,332,002 Cash Surplus/Deficit 524, , , , , , , ,937 Taxes Total Taxes 22,129 29,648 26,045 21,460 63,222 63,560 63, ,589 Tax Penalty Federal Marginal Tax Rate 25.00% 25.00% 25.00% 25.00% 28.00% 28.00% 28.00% 33.00% State Marginal and Local Tax Rate 6.45% 6.45% 6.45% 6.45% 6.65% 6.65% 6.65% 6.65% Estimated Required Minimum Distribution (RMD) John , , , ,565 Jane ,647 Adjusted Portfolio Value 5,916,950 6,068,574 6,261,614 6,465,333 6,681,979 6,911,360 7,150,963 7,401,265 Portfolio Withdrawal Rate 4.80% 4.23% 4.16% 4.06% 3.99% 3.96% 3.93% 4.49% / / / / / 70 Page 44 of 106

49 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Year Age (John / Jane) Retirement and Strategy Income Assign To / / 72 Pension Income Fund All Goals 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 Social Security - John Fund All Goals 48,464 49,433 50,422 51,430 52,459 53,508 54,578 55,670 Social Security - Jane Fund All Goals 48,464 49,433 50,422 51,430 52,459 53,508 54,578 55,670 Total Retirement and Strategy Income 126, , , , , , , ,339 Other Additions Assign To Jane's Practice Fund All Goals John's Whole Life Fund All Goals Total Other Additions Investment Earnings 561, , , , , , , ,999 Total Income and Earnings 688, , , , , , , ,338 Cash Used To Fund Goals Estimated % Funded Retirement - Living Expense 100% 285, , , , , , , ,121 Health Care 100% 50,768 54,068 57,582 61,325 65,311 69,556 74,078 78,893 Travel 100% 21,424 21,852 22,289 22,735 23,190 23,653 24,127 24,609 Leave Bequest 100% Total Goal Funding (357,841) (367,282) (377,061) (387,193) (397,697) (408,590) (419,892) (431,623) Total Taxes and Tax Penalty (114,745) (121,484) (128,868) (136,640) (145,476) (154,747) (164,450) (175,354) Cash Surplus/Deficit (Net Change in Portfolio) 216, , , , , , , , / / / 75 Portfolio Value Future Dollars Beginning Value 7,615,411 7,831,673 8,049,248 8,267,226 8,484,892 8,700,737 8,913,790 9,122,991 Cash Surplus/Deficit 216, , , , , , , ,362 Investment Asset Additions Ending Value 7,831,673 8,049,248 8,267,226 8,484,892 8,700,737 8,913,790 9,122,991 9,326, / / / 78 Page 45 of 106

50 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Year Age (John / Jane) Current Dollars / / / 73 Ending Value 5,375,901 5,416,913 5,454,516 5,488,360 5,517,624 5,541,895 5,560,745 5,573,235 Cash Surplus/Deficit 148, , , , , , , ,525 Taxes Total Taxes 114, , , , , , , ,354 Tax Penalty Federal Marginal Tax Rate 33.00% 33.00% 33.00% 33.00% 33.00% 33.00% 33.00% 33.00% State Marginal and Local Tax Rate 6.65% 6.65% 6.65% 6.65% 6.85% 6.85% 6.85% 6.85% Estimated Required Minimum Distribution (RMD) John 138, , , , , , , ,076 Jane 133, , , , , , , ,098 Adjusted Portfolio Value 7,615,411 7,831,673 8,049,248 8,267,226 8,484,892 8,700,737 8,913,790 9,122,991 Portfolio Withdrawal Rate 4.54% 4.60% 4.66% 4.73% 4.81% 4.90% 4.99% 5.10% / / / / / 78 Page 46 of 106

51 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Year Age (John / Jane) Retirement and Strategy Income Assign To / / 80 Pension Income Fund All Goals 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 Social Security - John Fund All Goals 56,783 57,919 59,077 60,259 61,464 62,693 63,947 65,226 Social Security - Jane Fund All Goals 56,783 57,919 59,077 60,259 61,464 62,693 63,947 65,226 Total Retirement and Strategy Income 143, , , , , , , ,452 Other Additions Assign To Jane's Practice Fund All Goals John's Whole Life Fund All Goals Total Other Additions Investment Earnings 683, , , , , , , ,987 Total Income and Earnings 826, , , , , , , ,439 Cash Used To Fund Goals Estimated % Funded Retirement - Living Expense 100% 334, , , , , , , ,446 Health Care 100% 84,021 89,482 95, , , , , ,567 Travel 100% 25,101 25,603 26,115 26, Leave Bequest 100% Total Goal Funding (443,806) (456,463) (469,619) (483,299) (470,362) (484,633) (499,506) (515,013) Total Taxes and Tax Penalty (186,713) (198,955) (212,126) (225,522) (240,499) (256,415) (272,489) (289,782) Cash Surplus/Deficit (Net Change in Portfolio) 196, , , , , , , , / / / 83 Portfolio Value Future Dollars Beginning Value 9,326,353 9,522,513 9,709,526 9,885,221 10,047,991 10,223,939 10,383,849 10,525,758 Cash Surplus/Deficit 196, , , , , , , ,644 Investment Asset Additions Ending Value 9,522,513 9,709,526 9,885,221 10,047,991 10,223,939 10,383,849 10,525,758 10,646, / / / 86 Page 47 of 106

52 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Year Age (John / Jane) Current Dollars / / / 81 Ending Value 5,578,879 5,576,905 5,566,489 5,547,203 5,533,666 5,510,016 5,475,801 5,429,964 Cash Surplus/Deficit 114, ,415 98,936 89,861 95,231 84,854 73,825 61,532 Taxes Total Taxes 186, , , , , , , ,782 Tax Penalty Federal Marginal Tax Rate 33.00% 33.00% 33.00% 33.00% 33.00% 33.00% 35.00% 35.00% State Marginal and Local Tax Rate 6.85% 6.85% 6.85% 6.85% 6.85% 6.85% 6.85% 6.85% Estimated Required Minimum Distribution (RMD) John 235, , , , , , , ,376 Jane 231, , , , , , , ,830 Adjusted Portfolio Value 9,326,353 9,522,513 9,709,526 9,885,221 10,047,991 10,223,939 10,383,849 10,525,758 Portfolio Withdrawal Rate 5.22% 5.35% 5.50% 5.65% 5.55% 5.73% 5.91% 6.12% / / / / / 86 Page 48 of 106

53 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Year Age (John / Jane) Retirement and Strategy Income Assign To / 87 Pension Income Fund All Goals 30,000 30,000 30,000 30,000 30,000 30,000 Social Security - John Fund All Goals 66, Social Security - Jane Fund All Goals 66,530 67,861 69,218 70,603 72,015 73,455 Total Retirement and Strategy Income 163,061 97,861 99, , , ,455 Other Additions Assign To Jane's Practice Fund All Goals John's Whole Life Fund All Goals 0 1,000, Total Other Additions 0 1,000, Investment Earnings 772, , , , , ,372 Total Income and Earnings 935,408 1,958, , , , ,827 Cash Used To Fund Goals Estimated % Funded Retirement - Living Expense 100% 392, , , , , ,830 Health Care 100% 139,054 74,046 78,859 83,985 89,444 95,258 Travel 100% Leave Bequest 100% ,000,000 Total Goal Funding (531,189) (424,027) (435,840) (448,105) (460,846) (1,474,088) Total Taxes and Tax Penalty (306,531) (337,339) (359,886) (380,259) (401,012) (391,299) Cash Surplus/Deficit (Net Change in Portfolio) 97,687 1,197, , , ,766 (933,560) Portfolio Value Future Dollars Beginning Value 10,646,401 10,744,088 11,941,219 12,118,748 12,277,060 12,413,825 Cash Surplus/Deficit 97,687 1,197, , , ,766 (933,560) Investment Asset Additions Ending Value 10,744,088 11,941,219 12,118,748 12,277,060 12,413,825 11,480, / / / / / 92 Page 49 of 106

54 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Year Age (John / Jane) Current Dollars / 87 Ending Value 5,372,341 5,853,862 5,824,403 5,784,793 5,734,544 5,199,302 Cash Surplus/Deficit 48, ,861 85,322 74,595 63,179 (422,801) Taxes Total Taxes 306, , , , , ,299 Tax Penalty Federal Marginal Tax Rate 35.00% 39.60% 39.60% 39.60% 39.60% 39.60% State Marginal and Local Tax Rate 6.85% 6.85% 6.85% 6.85% 6.85% 6.85% Estimated Required Minimum Distribution (RMD) John 357, Jane 370, , , , , ,278 Adjusted Portfolio Value 10,646,401 11,744,088 11,941,219 12,118,748 12,277,060 12,413,825 Portfolio Withdrawal Rate 6.34% 5.65% 5.83% 6.01% 6.19% 14.19% / / / / / 92 Page 50 of 106

55 Worksheet Detail - Retirement Distribution Cash Flow Chart Scenario : Save More/Ret Later using Average Returns Notes IMPORTANT: The projections or other information generated by this tool regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. Results may vary with use and over time. The return assumptions used are estimates based on average annual returns for the index used as a proxy for each asset class. The portfolio returns were calculated by weighting individual return assumptions for each asset class according to the portfolio allocation selected by you or your Financial Advisor. The portfolio returns may have also been modified by your Financial Advisor to reflect the outcome of a different return by conducting a Total Return Adjustment or selecting a Custom Portfolio. For a explanation of the methodology used to calculate returns, please review the Important Disclosure Information and Return Methodology sections. The return assumptions in this tool are not reflective of any specific product and do not include any fees or expenses that may be incurred by investing in specific products. The actual returns of a specific product may be more or less than the returns used in this tool. No investment strategy or allocation can eliminate risk or guarantee investment results. The values shown for income and investment earnings are estimates based on the assumptions included in this report, such as rates of return, inflation rate, asset values, asset additions, tax rates, income sources and amounts, and goal expenses. Any changes in assumptions will also change these values. Additions and withdrawals occur at the beginning of the year. The Income section includes Retirement Income, Strategy Income, Stock Options, Restricted Stock, Other Assets, proceeds from Insurance Policies, and any remaining asset value after 72(t) distributions have been completed. Retirement Income includes the following: Social Security, pension, annuity, rental property, royalty, alimony, part-time employment, trust, and any other retirement income as entered in the Plan. For married clients, if either Social Security Program Estimate or Use This Amount and Evaluate Annually is selected for a participant, the Program defaults to the greater of the selected benefit or the age-adjusted spousal benefit based on the other participant s benefit. The spousal benefit is not applicable to domestic partners. Strategy Income is based on the particulars of the Goal Strategies selected. Strategy Income from immediate annuities and 72(t) distributions is pre-tax. Strategy Income from Net Unrealized Appreciation (NUA) is after-tax. Stock Options and Restricted Stock values are after-tax and based on the Exercise Scenario selected. Income from Other Assets and proceeds from Insurance Policies are after-tax values. Any remaining asset value after 72(t) distributions have been completed is a pre-tax value. Investment Earnings are calculated on all assets after any withdrawals for funding goals, taxes on withdrawals, and tax penalties, if applicable, are subtracted. Shortfalls that occur in a particular year are denoted with an 'x' in the Cash Used to Fund Goals section of the chart. The Total Taxes are a sum of (1) taxes on retirement income, (2) taxes on strategy income, (3) taxes on withdrawals from qualified assets for Required Minimum Distributions, (4) taxes on withdrawals from taxable assets' untaxed gain used to fund Goals in that year, (5) taxes on withdrawals from tax-deferred or qualified assets used to fund goals in that year, and (6) taxes on the investment earnings of taxable assets. Tax rates used are detailed in the Tax and Inflation Options page. (Please note, the Total Taxes do not include any taxes owed from the exercise of Stock Options or the vesting of Restricted Stock.) Tax Penalties can occur when Qualified and Tax-Deferred Assets are used prior to age 59½. If there is a value in this row, it illustrates that you are using your assets in this Plan in a manner that may incur tax penalties. Generally, it is better to avoid tax penalties whenever possible. The Cash Surplus/Deficit is the net change in the Portfolio Value for the specified year. This value is your income and earnings minus what was spent to fund goals minus taxes. The Ending Value of the Portfolio in Current Dollars is calculated by discounting the Ending Value of the Portfolio in Future Dollars by the Base Inflation Rate for this Plan. The Cash Surplus/Deficit in Current Dollars is calculated by discounting the Cash Surplus/Deficit in Future Dollars by the Base Inflation Rate for this Plan. These calculations do not incorporate penalties associated with use of 529 Plan withdrawals for non-qualified expenses. For married clients, ownership of qualified assets is assumed to roll over to the surviving co-client at the death of the original owner. For domestic partners, qualified assets are assumed to be transferred as a non-spousal inheritance to the surviving co-client at the death of the original owner. In both cases, the Program assumes the surviving co-client inherits all remaining assets of the original owner. Page 51 of 106

56 Worksheet Detail - Sources of Income and Earnings Scenario : Save More/Ret Later using Average Returns This graph shows the income sources and earnings available in each year from retirement through the End of the Plan. Notes IMPORTANT: The projections or other information generated by this tool regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. Results may vary with use and over time. Sources of Income can include Retirement Income, Strategy Income, Stock Options, Restricted Stock, Other Assets, proceeds from Insurance Policies, and any remaining asset value after 72(t) distributions have been completed. Investment Earnings are calculated on all assets after any withdrawals for funding goals, taxes on withdrawals, and tax penalties, if applicable, are subtracted. All Retirement Income, Immediate Annuity Strategy Income, 72(t) Strategy Income, the remaining asset value after 72(t) distributions, and Investment Earnings are pre-tax, future values. NUA Strategy Income, Stock Options, Restricted Stock, Other Assets, and proceeds from Insurance Policies are after-tax future values. For married clients, if either Social Security Program Estimate or Use This Amount and Evaluate Annually is selected for a participant, the Program defaults to the greater of the selected benefit or the age-adjusted spousal benefit based on the other participant s benefit. The spousal benefit is not applicable to domestic partners. Page 52 of 106

57 Employer Stock Plans

58 Stock Options Introduction to Your Stock Options This section of your report summarizes your Stock Option plan and calculates your current option equity value for all fully vested shares. It also calculates an estimate of the potential future option equity values, that may be available to help fund your goals each year based upon the assumptions you have made. We believe this information is an important step in a financial goal plan. We look forward to helping you make informed decisions regarding your stock option strategy. This Report is for your information only and does not constitute the solicitation to purchase or sell any specific security. General Discussion Your stock options can be a significant component of your financial portfolio. Stock options can give you the opportunity to benefit from the potential appreciation in your company's stock. As with any other investments, there are certain risks associated with stock options which you should take into consideration. Therefore, it is critical that you are familiar with your stock options, how they function, and the financial implications they may have on your overall portfolio. Stock options provide employees with the right to buy company stock at a specified price, known as the strike price, within a certain period of time. A company can grant two types of stock options - incentive stock options (ISOs) and non-qualified stock options (NQOs). Incentive Stock Options (ISOs) - One advantage of an ISO is that no regular income tax is recognized upon exercising the option. In addition, if the acquired stock is held for two years from the date of grant and one year from the date of exercise, favorable long-term capital gains rates will apply to all of the appreciation (between the strike price and sale price) upon the subsequent sale of the stock. The sale of any shares prior to satisfying either of these holding period requirements will be treated as a "disqualifying disposition." If the acquired stock is not held for one year from exercise, the bargain element (the difference between the value of the stock on exercise and the strike price, also referred to as "spread") is treated as ordinary income and any post-exercise gain is short-term capital gain. If the stock is held for one year from exercise but not two years from grant, the bargain element (or spread) is ordinary income and any post-exercise gain is long-term capital gain. Although the exercise of an ISO is generally not a taxable event for regular tax purposes, the difference between the strike price and the stock price on the date of exercise is considered a preference item for federal, and possibly state, alternative minimum tax (AMT) purposes. Depending on the circumstances, the exercise of ISOs can cause a taxpayer to be subject to the AMT and incur a higher tax liability even though shares have not yet been sold and gains have yet to be realized. Nonqualified Stock Options (NQOs) - Unlike ISOs, the spread on NQOs is immediately recognized as compensation income upon exercise, for regular tax purposes, and is therefore subject to federal, and possibly state income tax, as well as Medicare and FICA tax. If the stock is held after exercise, any subsequent appreciation is treated as capital gain (long-term, if held for more than one year) when the stock is sold. Stock Options Scenarios The future potential after-tax option equity cash flows illustrated in this analysis, for each exercise scenario, were calculated based on selecting one or more Timing Methods and certain assumptions described below: Available Timing Methods All scenarios assume a cashless exercise strategy. Now - All Vested Only - Currently vested options that are in-the-money by any amount are exercised now; all remaining options are lost. Now and As Vested - Currently vested options that equal or exceed the minimum percentage gain are exercised now. Remaining options are either exercised in the first year they are both vested and exceed the minimum percentage gain or are exercised in the year they expire if they are in-the-money by any amount. Now and At Expiration - Currently vested options that equal or exceed the minimum percentage gain are exercised now. All remaining options are exercised in the year they expire if they are in-the-money by any amount. Start Year and As Vested - Beginning in the exercise start year, vested options that equal or exceed the minimum percentage gain are exercised. After the exercise start year, remaining options are either exercised in the first year they are both vested and exceed the minimum percentage gain or are exercised in the year they expire if they are in-the-money by any amount. Start Year and At Expiration - Beginning in the exercise start year, vested options that equal or exceed the minimum percentage gain are exercised. After the exercise start year, remaining options are exercised in the year they expire if they are in-the-money by any amount. At Expiration - Options are exercised in the year they expire if they are in-the-money by any amount. Page 53 of 106

59 Stock Options Other Assumptions Return assumption for this Stock - The projected return for the asset class category selected, unless otherwise indicated by you. If a Stock Option Plan with Scenarios is treated as a Special Asset, the return assumption for this stock includes three growth rates -- labeled Low, Expected and High returns. The Program default for all three returns is the projected return for the asset class category selected, and can be changed by you. This approach can help illustrate financial risk not otherwise reflected in the Plan results. Minimum percentage gain to exercise - The minimum percentage gain in the stock price above the exercise price that is required before exercising options. Applying this minimum defers the exercise of options with only relatively small spread between the stock price and the option price. Vesting Termination Year - A year in which it is assumed that vesting ends prematurely. All remaining unvested options are lost. Exercise Start Year - A year in which it is expected that you will begin to exercise vested options, if different than the current year. Hold ISO for One Year - If it is indicated that ISO shares are not to be "Held for One Year", then it is assumed that the ISO shares are disqualified and a Regular Tax Rate is applied. If it is indicated that ISO shares are to be "Held for One Year", it is assumed that those shares will have been held for at least two years from the date of grant and over one year from the date of exercise, thus qualifying for long-term capital gains treatment and the Long-Term Tax Rate is applied. General Assumptions The Regular Tax Rate is the estimated tax rate applied to the potential option equity on all NQOs exercised and sold and on any ISO shares sold that were not held for one year. This rate should be the total estimate for all applicable taxes, including Federal, State, and Local Income taxes. Unless included in this rate, Medicare and FICA taxes are not applied separately to NQO equity. The Long-Term Tax Rate is the estimated tax rate applied to the potential option equity on any ISO shares sold that were held for more than one year after exercise (as well as two years from date of grant). This rate should be the total estimate for all applicable taxes, including Federal, State, and Local Income taxes. The possible impact of the Alternative Minimum Tax (AMT) is not reflected in any calculations. Since the exercise of ISOs can have substantial AMT consequences, you should consult with your personal tax advisor. The after-tax calculations within the Option Equity Schedule and Price Sensitivity Analysis assume that all ISOs are disqualified and the Regular Tax Rate is applied. In addition, the Vesting Schedule does not calculate whether ISO grants meet the $100,000 limitation. Exercise costs for NQOs and ISOs have not been considered nor have any dividends that might have been received from ISOs that are exercised and held for one year. Grants expected to be received in the future are not represented in this Stock Option Summary. Cash Receipt Schedule The future potential after-tax option equity cash flows illustrated in this analysis, for each Cash Receipt Schedule, are the amounts you entered, based on your own calculations. Assumptions The Current Value should represent the current value of all vested stock options in this Stock Option Plan. The Value if the Owner dies today should represent the value to be paid by the Stock Option Plan if the owner dies today. The Cash Receipts Table shows expected after-tax amounts for one or more years in the future, based on your own calculations and as entered by you. If a Stock Option Plan with a Cash Receipt Schedule is treated as a Special Asset, the Cash Receipts Table shows the Low, Expected, and High after-tax amounts for each year in the future, based on your own calculation and as entered by you. This approach can help illustrate financial risk not otherwise reflected in the Plan results. The possible impact of the Alternative Minimum Tax (AMT) and any other cost and taxes associated with exercising Stock Options are not reflected in any calculations, unless its impact was taken into account, by you, when entering the cash receipt amounts. Page 54 of 106

60 Stock Options Summary Morgan Stanley (MS) Owner : John Options Granted : 15,000 Exercised : 0 Option Equity After Tax : $7,086 Market Price* : $31.81 on 12/31/2015 Asset Class : Options Vest at Death : Special Asset : US Large Cap Growth No No Outstanding Options Vested : Not Vested : 1,000 14,000 * Security prices included in the stock option analysis are based on the market price that you entered for the date referenced and are included only because the system requires it for analysis purposes. This Report is for your information only and does not constitute the solicitation to purchase or sell any specific security and you should not rely on the information presented when making an investment or liquidation decision. We make no warranty with respect to any security price and do not guarantee that the price listed will be available to you should you choose to exercise your options. The actual price available to you should you choose to exercise your options may be more or less than indicated on the report. Vesting Schedule Assumptions Regular Tax Rate : 40.0% Long-Term Tax Rate : 20.0% The Vesting Schedule below is a summary showing the percentage of each option grant that becomes exercisable over time according to the information you have provided. Name % Vested by Year MS Vest 20% 20% 20% 20% 20% 0% 0% 0% 0% 0% Page 55 of 106

61 Stock Options Summary Option Equity Schedule The Option Equity Schedule below shows a summary of your stock option grants and calculates the pre-tax and after-tax option equity value for all vested stock options based on the current market price. These values are calculated using the information you provided for each grant, your tax rate assumption and the current market price of the stock as indicated by you. If your plan includes ISOs, the After Tax Option Equity value assumes that all ISOs are immediately disqualified and the regular tax rate is applied. This Report does not constitute the solicitation to purchase or sell any specific security. Grant Name Date Price Type Expiration Date Vesting Schedule Options Outstanding Options Option Equity - Vested Only Market Price $31.81 Granted Exercised Vested Not Vested Pre-Tax Tax at 40.0% After Tax 2014 Grant 01/31/2014 $20.00 ISO 01/01/2024 MS Vest 5, ,000 4,000 $11,810 $4,724 $7, Grant 01/31/2015 $30.00 NQO 01/01/2025 MS Vest 10, ,000 $0 $0 $0 Price Sensitivity Analysis Total : 15, ,000 14,000 $11,810 $4,724 $7,086 The Price Sensitivity Analysis shows a summary of your stock option grants and calculates the potential after-tax option equity values for all vested stock options based on the current market price as indicated by you as well as a variety of higher and lower assumed prices. Understanding the impact of potential stock price changes on the after-tax option equity value of particular grants can play an important role in determining option exercise strategies. If your plan includes ISOs, the After Tax Option Equity value assumes that all ISOs are immediately disqualified and the regular tax rate is applied. Grant Option Equity Sensitivity - After Tax for Vested Options Only Name Date Price Type Expiration Date Vested Options -25% $ % $ Grant 01/31/2014 $20.00 ISO 01/01/2024 1,000 $2,315 $4,223 $7,086 $9,949 $11, Grant 01/31/2015 $30.00 NQO 01/01/ $0 $0 $0 $0 $0 Total : Market* $ % $ % $39.76 $2,315 $4,223 $7,086 $9,949 $11,858 Change In Value: -$4,772 -$2,863 $0 $2,863 $4,772 * Security prices included in the stock option analysis are based on the market price that you entered for the date referenced and are included only because the system requires it for analysis purposes. This Report is for your information only and does not constitute the solicitation to purchase or sell any specific security and you should not rely on the information presented when making an investment or liquidation decision. We make no warranty with respect to any security price and do not guarantee that the price listed will be available to you should you choose to exercise your options. The actual price available to you should you choose to exercise your options may be more or less than indicated on the report. Page 56 of 106

62 Stock Options Summary Full Vesting Schedule The Full Vesting Schedule illustrates the amount of stock options that are currently vested and calculates any additional amounts that vest in future years based on the applicable Vesting Schedule. Grant Options Vesting Each Year Name Date Price Type Expiration Date Vesting Schedule Currently Vested Grant 01/31/2014 $20.00 ISO 01/01/2024 MS Vest 1,000 1,000 1,000 1,000 1, Grant 01/31/2015 $30.00 NQO 01/01/2025 MS Vest 0 2,000 2,000 2,000 2,000 2,000 0 Stock Options Scenarios The Stock Options Scenarios show a summary of your stock option grants and, for each scenario, the timing method(s) and other assumptions outlined in the Stock Options Introduction that will be used to calculate future potential after-tax option equity as summarized in the Cash Flow Grant Name Date Price Type Expiration Date Total : Vesting Schedule 2020 Beyond 1,000 3,000 3,000 3,000 3,000 2,000 0 Outstanding Options Vested Not Vested Scenario 1 Timing Hold ISO? Scenario 2 Scenario Grant 01/31/2014 $20.00 ISO 01/01/2024 MS Vest 1,000 4,000 Now And As Yes At Expiration Yes Now And As Yes Vested Vested 2015 Grant 01/31/2015 $30.00 NQO 01/01/2025 MS Vest 0 10,000 Now And As N/A At Expiration N/A Now And As N/A Vested Vested Total : Return assumption for this stock : 1,000 14, % Timing 8.70% Hold ISO? Timing Accelerated Expiration Year : Minimum percentage gain to exercise : 8.00% 8.00% 8.00% Exercise Start Year : % Hold ISO? Page 57 of 106

63 Stock Options Summary Cash Flow Schedule The Cash Flow Schedule below shows the future potential after-tax option equity value for each scenario indicated, on a year-by-year basis. These are only estimates based on current information and not guarantees that you will obtain a specific value or tax benefit upon exercise of the Stock Options. This Report does not constitute the solicitation to purchase or sell any specific security. Year Assign to Goals Scenario 1 - Option Equity (after-tax) Scenario 2 - Option Equity (after-tax) Scenario 3 - Option Equity (after-tax) 2016 Fund All Goals 2017 Fund All Goals $34,310 $28, Fund All Goals $23,171 $16, Fund All Goals $29,711 $19, Fund All Goals $36,820 $22, Fund All Goals 2022 Fund All Goals 2023 Fund All Goals 2024 Fund All Goals 2025 Fund All Goals $360, Fund All Goals Total : $124,012 $360,012 $87,131 Important Note on Alternative Minimum Tax (AMT): If your plan includes ISOs, the possible impact of AMT is not reflected in these calculations. Since the exercise of ISOs can have substantial AMT consequences, you should consult with your personal tax advisor. Also, the possible impact of the value of ISOs becoming first exercisable during a single year and exceeding the $100,000 limitation, causing the excess ISOs to be disqualified, is not reflected in these calculations. Page 58 of 106

64 Risk Management

65 Life Insurance Needs Analysis Scenario : Save More/Ret Later Life insurance can be an important source of funds for your family in the event of your premature death. In this section, we analyze whether there are sufficient investment assets and other resources to support your family if you were to die this year and, if there is a deficit, what additional life insurance may be required to provide the income needed by your survivors. If John Dies Living Expenses covered until Jane is 92 $1,196,598 $1,000,000 $196,598 Life Insurance Needed Existing Life Insurance Additional Needed If Jane Dies Living Expenses covered until John is 90 $872,790 $300,000 $572,790 Page 59 of 106

66 Life Insurance Needs Analysis Detail Scenario : Save More/Ret Later Life Insurance If John Dies If Jane Dies $1,000,000 Existing Life Insurance $300,000 Liabilities and Final Expenses If John Dies $0 Additional Death Benefit $0 If Jane Dies $300,000 Debts Paid Off $300,000 $10,000 Final Expenses and Estate Taxes $10,000 $0 Bequests $0 $0 Other Payments $0 Living Expenses for Survivors Jane's Age Event John's Age 63 Retirement Plan Ends 90 If John Dies If Jane Dies First Living Expense $300,000 Annual Expense (current dollars, after-tax) $300, Cover expense until Co-Client is this age 62 Second Living Expense $175,000 Annual Expense (current dollars, after-tax) $175, Cover expense until Co-Client is this age 90 Page 60 of 106

67 Life Insurance Needs Analysis Detail Scenario : Save More/Ret Later Financial Goals Checked boxes indicate goals to be funded upon death. Sell Other Assets If John Dies If John Dies Health Care College - John Jr. Travel Leave Bequest If Jane Dies $0 Amount of cash provided by sale of Assets (after tax) $0 Your Assets that are not being sold to fund goals are listed below. Description Current Value Home $750,000 Checked boxes indicate Other Assets that will be included in this analysis and used to fund goals. If John Dies Stock Options and Restricted Stock Checked boxes indicate stock options to be included in Life Insurance. If John Dies Pension Jane's Practice If Jane Dies If Jane Dies Include John's Stock Options If Jane Dies Page 61 of 106

68 Life Insurance Needs Analysis Detail Scenario : Save More/Ret Later Other Income (Income other than employment income) If John Dies $0 Annual Other Income Amount $0 No If John Dies (current dollars before tax) Will this amount inflate? If Jane Dies Include Amount Description Amount Include Tax Rate (Estimated average tax rate) $30,000 Pension Income $30,000 Use this Rate Year Federal State Local Current rate % 6.85% 0.00% Change rate in % 0.00% 0.00% Rate of Return Use Return in the Plan you selected Dependents Rate of Return 7.71% Name Date of Birth Age Relationship John Jr. 08/07/ Both Are Parents No If Jane Dies Page 62 of 106

69 Disability Needs Analysis - John If John is Disabled Disability Insurance can provide an important source of funds during the time when you are unable to work due to a prolonged illness or injury. This section compares your income needs to your income sources for various disability periods. If there is an Income Shortfall, you may want to consider the purchase of a Disability Insurance Policy. Length of Disability Income Needed Employment Income Other Income Social Security Benefit Group* Insurance Personal Insurance Surplus or (Shortfall) 1 year(s) $500,000 $250,000 $0 $19,775 $0 $0 -$230,225 2 year(s) $510,004 $255,000 $0 $34,578 $0 $0 -$220,426 5 year(s) $541,220 $270,608 $0 $36,694 $0 $0 -$233, year(s) $597,551 $298,773 $0 $40,514 $0 $0 -$258, year(s) $609,502 $304,749 $0 $41,324 $0 $0 -$263,430 * The benefit amount may include an after-tax portion that has been grossed up to reflect its pre-tax value. Page 63 of 106

70 Disability Needs Analysis - John If John is Disabled Refine Needs Analysis Social Security Do you want to include Social Security Disability Benefits in the analysis? Income Needed (pre-tax, current dollars) During the first year Month 1 $41,674 per month Month 2 & 3 $41,666 per month Month 4 & 5 $41,666 per month Month 6-12 $41,666 per month Surplus or Shortfall During First Year All amounts in this table are monthly, pre-tax amounts. First Year - Month Income Needed Employment Income During these years Year 2 Year 3-5 Year 6 to Age 65 Other Income Social Security Benefit Yes $41,667 per month $41,667 per month $41,667 per month Group* Insurance Personal Insurance $500,004 per year $500,004 per year $500,004 per year Surplus or (Shortfall) 1 $41,674 $20,833 $0 $0 $0 $0 -$20,841 2 $41,666 $20,833 $0 $0 $0 $0 -$20,833 3 $41,666 $20,833 $0 $0 $0 $0 -$20,833 4 $41,666 $20,833 $0 $0 $0 $0 -$20,833 5 $41,666 $20,833 $0 $0 $0 $0 -$20,833 6 $41,666 $20,833 $0 $2,825 $0 $0 -$18,008 7 $41,666 $20,833 $0 $2,825 $0 $0 -$18,008 8 $41,666 $20,833 $0 $2,825 $0 $0 -$18,008 9 $41,666 $20,833 $0 $2,825 $0 $0 -$18, $41,666 $20,833 $0 $2,825 $0 $0 -$18, $41,666 $20,833 $0 $2,825 $0 $0 -$18, $41,666 $20,833 $0 $2,825 $0 $0 -$18,008 * The benefit amount may include an after-tax portion that has been grossed up to reflect its pre-tax value. Page 64 of 106

71 Disability Needs Analysis - John If John is Disabled Surplus or Shortfall by Age All amounts in this table are annual, pre-tax amounts. Age Income Needed Employment Income Other Income Social Security Benefit Group* Insurance Personal Insurance Surplus or (Shortfall) 56 $510,004 $255,000 $0 $34,578 $0 $0 -$220, $520,204 $260,100 $0 $35,270 $0 $0 -$224, $530,608 $265,302 $0 $35,975 $0 $0 -$229, $541,220 $270,608 $0 $36,694 $0 $0 -$233, $552,045 $276,020 $0 $37,428 $0 $0 -$238, $563,086 $281,541 $0 $38,177 $0 $0 -$243, $574,347 $287,171 $0 $38,940 $0 $0 -$248, $585,834 $292,915 $0 $39,719 $0 $0 -$253, $597,551 $298,773 $0 $40,514 $0 $0 -$258, $609,502 $304,749 $0 $41,324 $0 $0 -$263,430 * The benefit amount may include an after-tax portion that has been grossed up to reflect its pre-tax value. Notes Disability benefits may be subject to an elimination period or benefit age cap. Income Needed is the amount you have indicated is necessary to maintain your standard of living during the disability period. Page 65 of 106

72 Disability Needs Analysis - Jane If Jane is Disabled Disability Insurance can provide an important source of funds during the time when you are unable to work due to a prolonged illness or injury. This section compares your income needs to your income sources for various disability periods. If there is an Income Shortfall, you may want to consider the purchase of a Disability Insurance Policy. Length of Disability Income Needed Employment Income Other Income Social Security Benefit Group* Insurance Personal Insurance Surplus or (Shortfall) 1 year(s) $500,000 $250,000 $0 $19,775 $0 $0 -$230,225 2 year(s) $510,004 $255,000 $0 $34,578 $0 $0 -$220,426 5 year(s) $541,220 $270,608 $0 $36,694 $0 $0 -$233, year(s) $597,551 $298,773 $0 $40,514 $0 $0 -$258, year(s) $646,808 $323,402 $0 $43,853 $0 $0 -$279,554 * The benefit amount may include an after-tax portion that has been grossed up to reflect its pre-tax value. Page 66 of 106

73 Disability Needs Analysis - Jane If Jane is Disabled Refine Needs Analysis Social Security Do you want to include Social Security Disability Benefits in the analysis? Income Needed (pre-tax, current dollars) During the first year Month 1 $41,674 per month Month 2 & 3 $41,666 per month Month 4 & 5 $41,666 per month Month 6-12 $41,666 per month Surplus or Shortfall During First Year All amounts in this table are monthly, pre-tax amounts. First Year - Month Income Needed Employment Income During these years Year 2 Year 3-5 Year 6 to Age 65 Other Income Social Security Benefit Yes $41,667 per month $41,667 per month $41,667 per month Group* Insurance Personal Insurance $500,004 per year $500,004 per year $500,004 per year Surplus or (Shortfall) 1 $41,674 $20,833 $0 $0 $0 $0 -$20,841 2 $41,666 $20,833 $0 $0 $0 $0 -$20,833 3 $41,666 $20,833 $0 $0 $0 $0 -$20,833 4 $41,666 $20,833 $0 $0 $0 $0 -$20,833 5 $41,666 $20,833 $0 $0 $0 $0 -$20,833 6 $41,666 $20,833 $0 $2,825 $0 $0 -$18,008 7 $41,666 $20,833 $0 $2,825 $0 $0 -$18,008 8 $41,666 $20,833 $0 $2,825 $0 $0 -$18,008 9 $41,666 $20,833 $0 $2,825 $0 $0 -$18, $41,666 $20,833 $0 $2,825 $0 $0 -$18, $41,666 $20,833 $0 $2,825 $0 $0 -$18, $41,666 $20,833 $0 $2,825 $0 $0 -$18,008 * The benefit amount may include an after-tax portion that has been grossed up to reflect its pre-tax value. Page 67 of 106

74 Disability Needs Analysis - Jane If Jane is Disabled Surplus or Shortfall by Age All amounts in this table are annual, pre-tax amounts. Age Income Needed Employment Income Other Income Social Security Benefit Group* Insurance Personal Insurance Surplus or (Shortfall) 53 $510,004 $255,000 $0 $34,578 $0 $0 -$220, $520,204 $260,100 $0 $35,270 $0 $0 -$224, $530,608 $265,302 $0 $35,975 $0 $0 -$229, $541,220 $270,608 $0 $36,694 $0 $0 -$233, $552,045 $276,020 $0 $37,428 $0 $0 -$238, $563,086 $281,541 $0 $38,177 $0 $0 -$243, $574,347 $287,171 $0 $38,940 $0 $0 -$248, $585,834 $292,915 $0 $39,719 $0 $0 -$253, $597,551 $298,773 $0 $40,514 $0 $0 -$258, $609,502 $304,749 $0 $41,324 $0 $0 -$263, $621,692 $310,844 $0 $42,150 $0 $0 -$268, $634,126 $317,060 $0 $42,993 $0 $0 -$274, $646,808 $323,402 $0 $43,853 $0 $0 -$279,554 * The benefit amount may include an after-tax portion that has been grossed up to reflect its pre-tax value. Notes Disability benefits may be subject to an elimination period or benefit age cap. Income Needed is the amount you have indicated is necessary to maintain your standard of living during the disability period. Page 68 of 106

75 Long-Term Care Needs Analysis - John Scenario : Save More/Ret Later One of the greatest threats to the financial well-being of many people over 50 is the possible need for an extended period of Long-Term Care, either at home, in an Assisted Living Facility or in a Nursing Home. This Section demonstrates how these expenses could adversely affect your Investment Portfolio and how you might protect it with a Long-Term Care policy. This graph shows what would happen to your portfolio if John enters a Nursing Home at age 80 for 5 years at an annual cost, in Current Dollars, of $130,670 inflating at 4.50%. Total Cost of Long-Term Care : $2,055,940 Total of Existing Long-Term Care Policy Benefits : Total Benefits from purchasing a new Long-Term Care Policy* : Amount offset by expense reduction during care period : Net Cost of care to be paid from Portfolio : $0 $1,545,513 $418,519 $91,909 * Assumptions for new LTC policy are 5 year Benefit Period, 100-day Elimination Period, $250 Daily Benefit Amount, 100% Home Care Benefit, and Compounded Inflation at 5%. Page 69 of 106

76 Long-Term Care Needs Analysis - Jane Scenario : Save More/Ret Later One of the greatest threats to the financial well-being of many people over 50 is the possible need for an extended period of Long-Term Care, either at home, in an Assisted Living Facility or in a Nursing Home. This Section demonstrates how these expenses could adversely affect your Investment Portfolio and how you might protect it with a Long-Term Care policy. This graph shows what would happen to your portfolio if Jane enters a Nursing Home at age 80 for 3 years at an annual cost, in Current Dollars, of $130,670 inflating at 4.50%. Total Cost of Long-Term Care : $1,345,345 Total of Existing Long-Term Care Policy Benefits : Total Benefits from purchasing a new Long-Term Care Policy : Amount offset by expense reduction during care period : Net Cost of care to be paid from Portfolio : $0 $0 $0 $1,345,345 Page 70 of 106

77 Estate Analysis

78 Estate Introduction This section of your report provides a general overview of your current estate situation and shows the projected value of your estate at death. It includes an estimate of Federal Estate taxes, expenses, and the amounts to be received by your beneficiaries. If appropriate, this report also illustrates one or more estate planning strategies that you may want to consider. Important Note: This analysis is intended solely to illustrate potential estate analysis issues. Prior to taking any action, we recommend that you review the legal and/or tax implication of this analysis with your personal legal and/or tax advisor. You have told us the following about your current Estate situation; Neither John nor Jane have a Will. Neither John nor Jane have a Medical Directive. Neither John nor Jane have a Power Of Attorney. This Estate Analysis assumes that you both maintain valid wills that bequeath all assets to each other (Simple Will). This Estate Analysis may not accurately reflect your current estate where one or both of you does not have a Simple Will. It is important that both of you have a Will that is valid and up-to-date. Your Wills should be periodically reviewed by your legal advisor. You should also discuss the appropriateness of a Medical Directive and Power of Attorney with your legal advisor. You have indicated that you have not made provisions for a Bypass Trust. When this analysis illustrates the potential benefit of a Bypass Trust, it assumes that your assets will be properly titled and appropriate to fully fund the amount shown. The Need for Estate Planning How Will You Be Remembered? It is often said that you cannot take your money with you; however, it is somewhat comforting to know that you can determine what happens to it after you're gone. A well-designed estate plan can not only help make sure that your assets go where you want them to, but also makes the process simpler, faster, less expensive, and less painful. Such planning followed by an orderly transition of your estate can have a positive impact on the people you care about. Goal Planning is Important When it comes to estate taxes, the tax law seemingly penalizes those who fail to plan properly. Failure to properly plan can sometimes lead to greater estate taxes due. A well-designed estate plan can potentially reduce taxes substantially, and leave more money for your heirs. Probate - Expense and Delays Probate is the legal process for settling your Estate, which basically means that all your debts and taxes are paid and remaining assets are distributed. Probate can be time consuming and expensive, and is open to public review. A well-designed estate plan can reduce the costs of probate, save time, and even avoid probate for many assets. Your Beneficiaries - Leaving More The desire to control the ultimate disposition of that which we accumulate during our lifetime and to provide for those we care about is a strong motivation in most people. In this regard, there are many questions to answer: Who should get the money, and how much? When should they get it - all at once or over time? Who will manage the money? Do you want to place restrictions on some assets such as a business or property? How much should go to charity? Who gets important tangible assets (e.g. wedding rings, family heirlooms)? Which assets do you want sold? Which assets should never be sold? Will there be enough liquidity to pay taxes? You - Having Enough Estate Planning focuses on what happens after you die and includes strategies you can employ to increase the amount of your assets that pass to your beneficiaries. Some of these strategies, such as gifting and purchasing life insurance, can cost you a significant amount of money during your lifetime. While this is certainly financially helpful for your heirs, is it financially sound for you? A good estate plan also considers the impact of these strategies on you, while you're alive. You want to make sure that you will have enough money to support your own lifestyle, before spending money to help your heirs. Page 71 of 106

79 Estate Assumptions Important Information on Assumptions This analysis makes a number of assumptions that could significantly affect your results including, but not limited to, the following: Both of you are U.S. Citizens. For married clients, ownership of qualified assets is assumed to roll over to the surviving co-client at the death of the original owner. For domestic partners, qualified assets are assumed to be transferred as a non-spousal inheritance to the surviving co-client at the death of the original owner. In both cases, the Program assumes the surviving co-client inherits all remaining assets of the original owner. State inheritance, estate or gift taxes have not been incorporated. Gift taxes are not calculated every year, but are totaled and settled at the death of the donor. Generation-skipping taxes, if applicable, have not been calculated. All custodial accounts (UGMA and/or UTMA) are not included in the estate calculations. All amounts contributed to 529 Savings Plans are treated as completed gifts and there is no recapture provision for any 5-year pre-funding contribution elections. Prior gifts above the annual exclusion and for which no taxes have been paid are included in your Taxable Estate. Prior gifts above the annual exclusion and for which taxes have been paid are not included in your Taxable Estate. Financial Goals such as "Gift or Donation" or "Leave a Bequest" are not reflected in the Estate Analysis. Bequests stipulated in your will, including charitable bequests, are not reflected in the Estate Analysis. If applicable, reverted gifts and/or life insurance proceeds transferred to a Trust or third-party within three years of death are included in your Gross Estate and Taxable Estate. In certain calculations, the Bypass Trust may not be fully funded to the available estate exemption equivalent amount due to prior gifts, titling of assets, insufficient resources, and/or other bequests. The current values of vested stock options are included in the gross estate. The current values of unvested stock options are included if you indicated, on the Stock Options page, that the options vest at death. In the event Qualified Retirement Plans, IRAs, and Tax-deferred Annuities are used to fund the Bypass Trust, the program assumes the spouse has disclaimed the assets and the contigent beneficiary is a 'qualified' trust. In the event Other Assets, such as a Primary Residence or Personal Property, are used to fund the Bypass Trust, the program assumes these assets have a specific value and can in fact be used to fund the Bypass Trust. If applicable, the value of any payment that continues past death created by the Immediate Annuity Goal Strategy is not included in the estate calculations. Page 72 of 106

80 Estate Analysis Options Liabilities What is the remaining value of Liabilities at death? Die Today (Liabilities in Plan = $300,000) : $300,000 Die in fixed number of years : $0 Die at Life Expectancy (last death) : $0 Taxable Gifts since 1976 on which no gift tax was paid What is the value of prior gifts in excess of the John Jane annual gift exclusion on which you did not pay taxes? $0 $0 Addition to Estate Value IRD Assets* Die Today : Die in fixed number of years : Die at Life Expectancy : Non IRD Assets* Die Today : Die in fixed number of years : Die at Life Expectancy : Additional Death Benefit Die Today : Die in fixed number of years : Die at Life Expectancy : John Jane $0 $0 $0 $0 $0 $0 John Jane $0 $0 $0 $0 $0 $0 John Jane $0 $0 $0 $0 $0 $0 Final Expenses What costs do you want to include for Final Expenses? Funeral : Administration Fees Fixed Amount Plus % of Probate assets At 1st Death At 2nd Death $10,000 $10,000 $0 $0 2.00% 5.00% Personal Exclusion Amount What assumption do you want to use for the amount of the Personal Exclusion? Maximum Personal Exclusion Amount (Current Law) Bypass Trust Funding Amount Use Maximum amount * Income in Respect of a Decedent (IRD) is income a decedent earned or was entitled to receive before death (e.g. retirement plan assets). IRD assets are excluded from the probate estate and non-ird assets are included in the probate estate. Page 73 of 106

81 Estate Analysis Current Asset Ownership Detail This chart summarizes the current ownership and designated beneficiary(ies) of all of your Assets used in this Plan. Note: All Qualified Retirement Plans, IRA and Tax-deferred Assets are assumed to have the spouse as the beneficiary if married with the estate as contingent beneficiary, or the estate as the beneficiary if single. All other Assets owned individually or jointly are assumed to operate as prescribed by applicable law. We do not provide legal or tax advice. Please consult with your tax and/or legal advisor to review the ownership and beneficiary designations and their legal and tax implications since they can have a significant impact on the distribution of assets at your death and whether or not certain basic estate strategies can be implemented. Description John Jane Investment Assets Employer Retirement Plans Joint (Jane) Survivorship Common Entirety Community Property Joint (Other) Jane's 401(k) $200,000 $200,000 John's 401(k) $750,000 $750,000 Individual Retirement Accounts Jane's Traditional IRA $500,000 $500,000 Taxable and/or Tax-Free Accounts Investment Account $388,575 $388,575 College Saving Plans Total Beneficiaries 529 Savings Plan $75,000 $75,000 Co-Client of Insured (100%) Total Investment Assets $825,000 $700,000 $388,575 $0 $0 $0 $0 $1,913,575 Other Assets Home and Personal Assets Home $750,000 $750,000 Business and Property Jane's Practice $500,000 $500,000 Pension and Deferred Compensation Pension $300,000 $300,000 Cash Value Life John's Whole Life $100,000 $100,000 Co-Client of Insured (100%) Stock Options Morgan Stanley $11,810 $11,810 Page 74 of 106

82 Estate Analysis Current Asset Ownership Detail Description John Jane Joint (Jane) Survivorship Common Entirety Community Property Joint (Other) Total Other Assets $411,810 $500,000 $750,000 $0 $0 $0 $0 $1,661,810 Total Assets : $1,236,810 $1,200,000 $1,138,575 $0 $0 $0 $0 $3,575,385 Total Beneficiaries Page 75 of 106

83 Estate Analysis Results Combined Summary Using Save More/Ret Later - Both Die at life expectancy - John Predeceases Jane Existing Estate Will without Bypass Trust Existing Estate Will with Bypass Trust Total Estate : $12,681,844 $12,681,844 Federal Estate Tax** : $0 $0 Estate Expenses : $240,064 $20,000 Amount to Heirs : $12,441,780 $12,661,844 Additional Value to Heirs : $220,064 Amount to Heirs Net Estate Value : $12,441,780 $6,557,128 Bypass Trust : $0 $6,104,716 Other Life Insurance : $0 $0 Life Insurance in Trust : $0 $0 Total : $12,441,780 $12,661,844 Cash Needed to Pay Tax and Expenses Shortfall at First Death : $0 $0 Shortfall at Second Death : $0 $0 Bypass Trust Funding Funding Shortfall : $0 $6,468,999 ** State Estate Taxes are not included. In some states, the tax may be substantial. Notes Prior gifts are not included in the amount to heirs. Page 76 of 106

84 Estate Analysis Results Flowchart Existing Estate without Bypass Trust using Save More/Ret Later - Both Die at life expectancy - John Predeceases Jane John's Gross Estate 1st Death Taxes and Expenses $10,000 2nd Death Taxes and Expenses $230,064 Marital Deduction Jane's Gross Estate $7,051,819 $7,041,819 $12,671,844 Total Amount to Heirs Bypass Trust Transfer : $0 To Heirs : $0 Other Life Insurance $12,441,780 + $0 + $0 $0 + ILIT Policies Owned by Other $0 $0 = $12,441,780 Notes Gross Estate amounts may include the value of reverted gifts. Other Life Insurance includes policies where the first person to die is the owner and insured and the beneficiary of the policy is not the co-client or estate. Gross Estate amounts do not include the value of prior gifts. The Bypass Trust may not be fully funded to the available estate exemption equivalent amount due to prior gifts, titling of assets, insufficient resources, and/or other bequests. Page 77 of 106

85 Estate Analysis Results Flowchart Existing Estate with Bypass Trust using Save More/Ret Later - Both Die at life expectancy - John Predeceases Jane John's Gross Estate 1st Death Taxes and Expenses $10,000 2nd Death Taxes and Expenses $10,000 Marital Deduction Jane's Gross Estate $7,051,819 $2,830,818 $6,567,128 Total Amount to Heirs Bypass Trust Transfer : $4,211,001 To Heirs : $6,104,716 Other Life Insurance $6,557,128 + $6,104,716 + $0 $0 + ILIT Policies Owned by Other $0 $0 = $12,661,844 Notes Gross Estate amounts may include the value of reverted gifts. Other Life Insurance includes policies where the first person to die is the owner and insured and the beneficiary of the policy is not the co-client or estate. Gross Estate amounts do not include the value of prior gifts. The Bypass Trust may not be fully funded to the available estate exemption equivalent amount due to prior gifts, titling of assets, insufficient resources, and/or other bequests. Page 78 of 106

86 Estate Analysis What If Results Combined Summary Using Save More/Ret Later - Both Die in 10 years - John Predeceases Jane Existing Estate Estate Scenario 1 Total Estate : $7,322,995 $8,198,642 Federal Estate Tax** : $0 $0 Estate Expenses : $124,942 $26,000 Amount to Heirs : $7,198,052 $8,172,642 Additional Value to Heirs : $974,590 Amount to Heirs and Charities Net Estate Value : $7,198,052 $5,210,391 Bypass Trust : $0 $1,962,252 Other Life Insurance : $0 $0 Life Insurance in Trust : $0 $1,000,000 Total : $7,198,052 $8,172,642 Cash Needed to Pay Tax and Expenses Shortfall at First Death : $0 $0 Shortfall at Second Death : $0 $0 Bypass Trust Funding Funding Shortfall : $0 $4,547,748 If you include in your Estate What-If scenario a change in ownership strategy where the insurance death benefit will not revert at death, the Gross and Taxable Estate will not include the death benefits from life insurance policies that were transferred within three years of death - this option is for illustrative and comparison purposes only. Page 79 of 106

87 Estate Analysis What If Results Combined Summary Using Save More/Ret Later - Both Die in 10 years - John Predeceases Jane Results for your Goal Plan include the Estate Strategies selected as shown below. Estimated % of Goal Funded Goal Existing Estate Estate Scenario 1 Wealth Transfer (ILIT) N/A 100% Retirement - Living Expense 100% 100% Health Care 100% 100% College - John Jr. 100% 100% Travel 100% 100% Leave Bequest 100% 100% Safety Margin (Value at End of Plan) Strategy Bypass Trust Wealth Transfer (ILIT) Description Wealth Transfer (ILIT) Second to Die - $1,000,000 $10,000 premium per year Current dollars : Future dollars : ** State Estate Taxes are not included. In some states, the tax may be substantial. Notes Prior gifts are not included in the amount to heirs. $5,199,302 $11,480,265 Include $4,623,653 $10,209,209 Include Page 80 of 106

88 Estate Analysis What If Results Combined Summary Using Save More/Ret Later - Both Die in 10 years - Jane Predeceases John Existing Estate Estate Scenario 1 Total Estate : $7,322,995 $8,198,642 Federal Estate Tax** : $0 $0 Estate Expenses : $130,823 $32,190 Amount to Heirs : $7,192,172 $8,166,452 Additional Value to Heirs : $974,280 Amount to Heirs and Charities Net Estate Value : $7,192,172 $5,005,520 Bypass Trust : $0 $2,160,932 Other Life Insurance : $0 $0 Life Insurance in Trust : $0 $1,000,000 Total : $7,192,172 $8,166,452 Cash Needed to Pay Tax and Expenses Shortfall at First Death : $0 $0 Shortfall at Second Death : $0 $0 Bypass Trust Funding Funding Shortfall : $0 $4,349,068 If you include in your Estate What-If scenario a change in ownership strategy where the insurance death benefit will not revert at death, the Gross and Taxable Estate will not include the death benefits from life insurance policies that were transferred within three years of death - this option is for illustrative and comparison purposes only. Page 81 of 106

89 Estate Analysis What If Results Combined Summary Using Save More/Ret Later - Both Die in 10 years - Jane Predeceases John Results for your Goal Plan include the Estate Strategies selected as shown below. Estimated % of Goal Funded Goal Existing Estate Estate Scenario 1 Wealth Transfer (ILIT) N/A 100% Retirement - Living Expense 100% 100% Health Care 100% 100% College - John Jr. 100% 100% Travel 100% 100% Leave Bequest 100% 100% Safety Margin (Value at End of Plan) Strategy Bypass Trust Wealth Transfer (ILIT) Description Wealth Transfer (ILIT) Second to Die - $1,000,000 $10,000 premium per year Current dollars : Future dollars : ** State Estate Taxes are not included. In some states, the tax may be substantial. Notes Prior gifts are not included in the amount to heirs. $5,199,302 $11,480,265 Include $4,623,653 $10,209,209 Include Page 82 of 106

90 Estate Analysis What If Results Flowchart Existing Estate without Bypass Trust using Save More/Ret Later - Both Die in 10 years - John Predeceases Jane John's Gross Estate 1st Death Taxes and Expenses Jane's Assets $16,000 $3,409,147 2nd Death Taxes and Expenses $108,942 Marital Deduction Jane's Gross Estate $3,913,848 Total Amount to Heirs Bypass Trust $3,897,848 $0 $7,306,995 Other Life Insurance $7,198,052 + $0 + $0 $0 + ILIT Policies Owned by Other $0 $0 = $7,198,052 Notes Gross Estate amounts may include the value of reverted gifts. Other Life Insurance includes policies where the first person to die is the owner and insured and the beneficiary of the policy is not the co-client or estate. Gross Estate amounts do not include the value of prior gifts. The Bypass Trust may not be fully funded to the available estate exemption equivalent amount due to prior gifts, titling of assets, insufficient resources, and/or other bequests. Page 83 of 106

91 Estate Analysis What If Results Flowchart Estate Scenario 1 using Save More/Ret Later - Both Die in 10 years - John Predeceases Jane John's Gross Estate 1st Death Taxes and Expenses Jane's Assets $16,000 $3,348,661 2nd Death Taxes and Expenses $10,000 Marital Deduction Jane's Gross Estate $3,849,981 Total Amount to Heirs Bypass Trust $1,871,729 $1,962,252 $5,220,391 Other Life Insurance $5,210,391 + $1,962,252 + $0 $0 + ILIT Policies Owned by Other $1,000,000 $1,000,000 = $8,172,642 Notes Gross Estate amounts may include the value of reverted gifts. Other Life Insurance includes policies where the first person to die is the owner and insured and the beneficiary of the policy is not the co-client or estate. Gross Estate amounts do not include the value of prior gifts. The Bypass Trust may not be fully funded to the available estate exemption equivalent amount due to prior gifts, titling of assets, insufficient resources, and/or other bequests. Page 84 of 106

92 Estate Analysis What If Results Flowchart Existing Estate without Bypass Trust using Save More/Ret Later - Both Die in 10 years - Jane Predeceases John Jane's Gross Estate 1st Death Taxes and Expenses John's Assets $22,190 $3,913,848 2nd Death Taxes and Expenses $108,633 Marital Deduction John's Gross Estate $3,409,147 Total Amount to Heirs Bypass Trust $3,386,957 $0 $7,300,805 Other Life Insurance $7,192,172 + $0 + $0 $0 + ILIT Policies Owned by Other $0 $0 = $7,192,172 Notes Gross Estate amounts may include the value of reverted gifts. Other Life Insurance includes policies where the first person to die is the owner and insured and the beneficiary of the policy is not the co-client or estate. Gross Estate amounts do not include the value of prior gifts. The Bypass Trust may not be fully funded to the available estate exemption equivalent amount due to prior gifts, titling of assets, insufficient resources, and/or other bequests. Page 85 of 106

93 Estate Analysis What If Results Flowchart Estate Scenario 1 using Save More/Ret Later - Both Die in 10 years - Jane Predeceases John Jane's Gross Estate 1st Death Taxes and Expenses John's Assets $22,190 $3,849,981 2nd Death Taxes and Expenses $10,000 Marital Deduction John's Gross Estate $3,348,661 Total Amount to Heirs Bypass Trust $1,165,539 $2,160,932 $5,015,520 Other Life Insurance $5,005,520 + $2,160,932 + $0 $0 + ILIT Policies Owned by Other $1,000,000 $1,000,000 = $8,166,452 Notes Gross Estate amounts may include the value of reverted gifts. Other Life Insurance includes policies where the first person to die is the owner and insured and the beneficiary of the policy is not the co-client or estate. Gross Estate amounts do not include the value of prior gifts. The Bypass Trust may not be fully funded to the available estate exemption equivalent amount due to prior gifts, titling of assets, insufficient resources, and/or other bequests. Page 86 of 106

94 Appendix

95 Risk Assessment Updated : 11/18/ What is your primary purpose for investing in this account? Investment Account Retirement Major Purchase Educational Planning Current Income Other 2. Do you need current income (that is, will you take regular withdrawals from this account)? Yes No If yes, approximately what percentage of the accounts current value do you need annually? Less than 2% Greater than 2%, but less than 4% Greater than 4%, but less than 6% Greater than 6% 3. In approximately how many years will you begin withdrawing funds for your investment objective? Immediately 1-5 years 6-10 years years Over 20 years 4. Once you begin to withdraw funds for your primary investment objective, over how long a period do you anticipate the withdrawals to continue? Lump Sum 1-5 years 6-10 years years Over 20 years 5. Which of the following statements best describes your attitude towards the trade-off between risk and return? I am most concerned with limiting risk. I am willing to accept lower expected returns in order to limit my chance of loss. I am willing to accept moderate risk and chance of loss in order to achieve moderate returns. Limiting risk and maximizing return are of equal importance to me. I am primarily concerned with maximizing the returns of my investments. I am willing to accept high risk and high chance of loss to maximize my investment return potential. Page 87 of 106

96 Risk Assessment Updated : 11/18/ The following graphs show the historical year by year returns for three hypothetical portfolios over a 20 year period. The average annual return over the 20-year period is also indicated. Again, please note that these are examples only, actual results may vary. Given your investment goals for this account, which portfolio would you choose? Portfolio X Portfolio Y Portfolio Z Portfolio X Average Annual Return=6% 7. The risk of a portfolio suffering a decrease in value (having a negative return) is often a primary concern for investors. To achieve potentially higher returns, however, an investor must be willing to accept greater risk. The following table portrays four different hypothetical $100,000 portfolios. For each portfolio, the expected value at the end of 1 year is shown along with the probabilities of suffering a decline that year, rather than a gain. Given your investment objective, in which of the 4 hypothetical portfolios would you be most comfortable investing? Portfolio A Portfolio B Portfolio C Portfolio D Portfolio Y Average Annual Return=9% Portfolio Expected value of $100,000 after 1 year Portfolio A Portfolio B Portfolio C Portfolio D $107,000 $108,000 $109,000 $110,000 Portfolio Z Average Annual Return=11% Chance of losing money after 1 year 19% 23% 26% 28% Page 88 of 106

97 Risk Assessment Updated : 11/18/ Each bar below shows a range of possible one-year ending values for a $100,000 initial investment in one of four hypothetical portfolios. The assumed value of the average return for that portfolio is shown in the center of the bar. For example, at the end of a given year, Portfolio A could have an ending value anywhere between $115,000 (a return of 15%) and $93,000 (-7% return). The average ending value is approximately $107,000 (7% return). It is important to remember that the hypothetical portfolios are more likely to achieve the average return over long-term holding periods. The four bars represent the four hypothetical portfolios. (Please note that these are only examples -- actual results will vary). Given the possible average, best, and worst outcomes for each portfolio, please indicate which of the four options would be most suitable for this account: Portfolio A Portfolio B Portfolio C Portfolio D 9. Inflation can greatly erode the return on your investments, especially over time. For example, in a typical year with a 3.5% inflation rate, a 6% return before inflation would have a real return of only 2.5% (6% - 3.5% = 2.5%). Please specify which of the following best summarizes your attitudes regarding investing and inflation. I prefer portfolio returns that are expected to return substantially more than inflation over the long run and I am willing to accept large short-term fluctuations in value (and a greater potential for loss) to achieve this goal. I prefer a portfolio that is expected to moderately exceed inflation over the long run and I am willing to accept moderate short-term fluctuations in value (and a moderate potential for loss) to achieve this goal. I prefer to minimize short-term fluctuations in portfolio value (and the potential for loss) as much as possible, even if it means that my portfolio is expected to only keep pace with or slightly exceed inflation. 10. Sometimes investment losses are permanent, sometimes they are prolonged, and sometimes they are short-lived. How might you respond when you experience investment losses? I would sell my investments immediately if they suffered substantial declines. Although declines in investment value make me uncomfortable, I would wait one to two quarters before adjusting my portfolio. I can endure significant declines in the value of my investments and would wait at least one year before adjusting my portfolio. Even if my investments suffered a significant decline over several years, I would continue to follow my long-term investment strategy and not adjust my portfolio. Page 89 of 106