1LIFE MASTERY FINANCIAL PLAN Welcome to 1Life Mastery Financial Planning! This is the foundation of what we teach and we are excited you are here! We believe every successful aspect of your life requires planning, whether it is planning a weekend, a year long home improvement project, or your future. Planning your financial future is one of the most important things you will ever do. Being financially secure is one of the best feelings in the world, and will give you and your loved ones the peace of mind that you will never have while living paycheck to paycheck. It isn t even that difficult. Really. Simply recognizing where your money goes, and implementing a little daily discipline in your spending, can help you begin to build a nest egg that can change your life. When your decisions aren t based on financial necessity, you will find greater freedom and satisfaction in your life, and will ultimately be able to do the things that matter most to you. Financial planning should not be taken lightly; there are many aspects to consider as you will see in this section of the 1Life Mastery course. You need to take into account short and long-term goals, and if you are married or have a significant other, there are many areas to discuss in order to avoid unpleasant financial surprises. While achieving your financial goals may seem over-whelming at times, don t give up. Stay the course. Take it one step at a time while following the online instructions, and reach out to our online community if you have questions or need encouragement along the way. Be persistent and focused and you will master your finances and achieve 1Life Fully Lived! 1 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
FINANCIAL SNAPSHOT The two parts in this exercise are determining your Net Worth, and conducting an Income and Expense Analysis. Note: A net worth statement is a snapshot of the current value of your financial holdings. Keep in mind that the market value of your assets can change as many homeowners have found out in the current mortgage crisis. That s why you should update your net worth statement at least annually. When you do one, be sure to date it. Compare each subsequent net worth statement to the previous one(s). To calculate your net worth, basically you add your assets and subtract your liabilities. Complete pages 2-6 to determine your net worth. Date: PERSONAL PROPERTY List the current value for each of the following. Type Details Market Value Loan Balance Automobile: Automobile: Boat: Collectibles: Art and antiques: Electronics: Jewelry: TOTAL Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 2
REAL ESTATE List the current value for each of the following. Type Cost (in dollars) Market Value (in dollars) Loan Balance (in dollars) Monthly Payment (in dollars) Primary residence: Vacation home: Rental property: TOTAL TAXABLE ASSETS List the current value for each of the following. Account/ You Spouse Joint Investment Cash on hand: Checking Account: Savings Account: CDs: Money market: Life insurance - cash surrender value: Stocks: 3 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
TAXABLE ASSETS (continued) Mutual funds: Closely held business interests Limited partnership interests TOTAL RETIREMENT ACCOUNTS List the current value for each of the following. Account You Spouse IRA s: 401(k)/403(b): Pension plan: Profit-sharing plan: Stock options: Deferred compensation: TOTAL Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 4
LIABILITIES List the current balance for each of the following. Ownership Type (You, spouse, or joint) Alimony/child support: Balance Due Additional Bank loans not previously listed: Credit cards: Home equity loan or line of credit not previously listed: Installment loan not previously listed: Insurance policy loan: Investment debt (margin): Personal loan not previously listed: Retirement plan loan: Student loans: Total Total Personal Property Loan Balances (pg.2) Total Real Estate Loan Balances (pg. 3) TOTAL LIABILITIES 5 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
NET WORTH STATEMENT Date: Assets Total Personal Property: Market Value (pg.2)!!!!!! $ Total Real Estate: Market Value (pg.3)!!!!!!! $ Total Taxable Assets (pgs.3-4)!!!!!!!! $ Total Retirement Accounts (pg.4)!!!!!!! $ Other Assets!!!!!!!!!! $!!!!! Total Assets!!! $ Liabilities Total Liabilities (pg.5)!!!!!!!! $ Delinquent Taxes!!!!!!!!! $ Other Liabilities!!!!!!!!! $! Total Liabilities!! $ Total Assets!!!!!!! $ Minus Total Liabilities!!!!!! - $ NET WORTH!!!!!!!! $ Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 6
INCOME and EXPENSE Analysis Note: An income and expense analysis helps determine your cash flow, and it s often used for budget purposes. Complete pages 8-10 as applicable. Some simple do s and don ts before you get started! Don't Start in a month with unusual expenditures (like a large amount of gifts in December). Fail to allow for unforeseen events. Make your emergency fund too accessible. Make yourself miserable. Get discouraged and give up if you fail at first. Ignore a problem when you see that you're spending too much in one category. Feel restricted by your budget. Wait until the end of the month to track your expenses. Be oblivious to how much money you're spending. Do Pick a more "normal" month that will set a good model for the rest of the year. Set aside an emergency fund to use when the unexpected happens. Put it in a separate money market fund that earns interest. Allow for "blow" money or another category that accounts for impulse buys. Tweak your categories and amounts and try again the next month. Find ways to save where you can. Remind yourself of your goals and reward yourself by spending money on things you've saved for. Keep up with your totals as you go so you won't overspend. Consider using cash only to assist you with sticking to your budget. 7 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
INCOME List the following sources of NET income. For each category, combine your amount with your spouse, if appropriate. Net Salary Type Monthly Annually Net Bonuses Net Commissions Self-employment income Dividends Interest taxable Interest tax-free Rental income (net) Annuities Alimony Trusts Child support Estates Gifts Retirement accounts Sale of property/investments Social Security payments Total Net Income Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 8
EXPENDITURES List the following current estimated expenditures. Type Monthly Annually Fixed Expenses Rent/Mortgage (No more than 28% of total expenses) Rental Property Expenses Car Payment (No more than 20% including insurance) Car Insurance Medical Insurance Renters / Homeowners Insurance Life Insurance Long Term Care Insurance Property Taxes Loans Childcare Alimony Variable Expenses Electricity/Gas Water/Sewer Garbage Cell/Landline Cable/Satellite/Internet Groceries (no more than 16%) Car Repairs/Maintenance Gasoline Credit Card Payments Gifts Home improvement/repair/maintenance Medical Expenses Total Fixed Expenses Total Variable Expenses Discretionary Expenses Books, Magazines, CD's Personal Grooming/Clothing Movies/Rentals 9 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
Concerts/Sporting Events Vacations Eating Out Total Discretionary Expenses Total Fixed Expenses Total Variable Expenses Total Discretionary Expenses TOTAL TOTAL NET INCOME Budget Surplus or Deficit Monthly Annually 1. Did you end up with a surplus or deficit? 2. Are you able to stay within the safe percentage ranges on your budget? 3. What budget category (savings, fixed, variable, discretionary) was the largest? Were you surprised by this? 4. Can you maintain a comfortable standard of living based on your estimated income level? If not, where can you adjust your expenses to live within your means? Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 10
FINANCIAL PLAN Note: This important exercise consists of a thorough examination of everything you need to consider while creating your Financial Plan. Complete pages 11-14 as applicable. Then create your final plan on pages 15-16. FINANCIAL OBJECTIVES Indicate which of the following objectives are important for your family. Objective Saving for education (yourself, children, grandchildren, etc.) Saving for retirement Important to Me? (yes/no) Important to Spouse? (yes/no) Being able to retire early (age 55 or earlier) Minimizing income taxes Minimizing estate taxes Providing support for an aging parent/relative Improving investment returns Improving insurance coverage Supporting a favorite charity Planning for your estate Improving your standard of living Changing or improving your employment situation 11 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
What is your current credit rating? CREDIT RATING You Spouse Date you last pulled a copy of your credit report? Which company was it from? Have you ever filed for bankruptcy? Do you intend to send your children to college? Will this be a public or private institution or some combination? Do you anticipate the need for financial aid? EDUCATION PLANNING What savings, if any, have you already made for college expenses? Is borrowing for college (student loans) an acceptable option? Do you expect your children to pay for part or all of their college educations? Who prepares your tax returns? TAX PLANNING What is your marginal federal tax bracket? Do you have adequate documentation to support your returns in the event of an audit? Do you expect to be in a higher or lower tax bracket in retirement? Do you normally receive a federal tax refund each year? Are you taking advantage of all of the tax benefits available through your employer? Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 12
RETIREMENT PLANNING Question You Spouse At what age do you plan to retire? Where will you retire? Have you made an estimate of income needed for retirement? (If so, list estimated annual amount in today s dollars.) Are you eligible for Social Security? (If so, list estimated annual amount.) What savings, if any, have you already made for retirement expenses? Are you taking maximum advantage of your employer s savings plans? How many years do you anticipate living in retirement? What preparations, if any, have you made for long-term healthcare needs? Do you expect to receive any inheritances? Do you have a current will? ESTATE PLANNING Document You Spouse Do you have a letter of instruction to assist your executor in administering your estate? Have you discussed your inheritance plan with your adult children and other potential heirs? Do you have a guardian for your children? Do you have a living will? Do you have a healthcare power of attorney? Do you have any trusts established? Do you wish to make charitable bequests at your death? Have you made known (or communicated) to others your preferences for funeral arrangements? 13 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
FINANCIAL GOALS List all of your financial goals and a timeframe for when you need to implement them. Family Goals Sense of Urgency (immediate, 3 to 12 months, 1 year, 5 years, or later) Estimated Financial Expense Your Individual Goals Spouse s Individual Goals Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 14
MY 1 YEAR FINANCIAL PLAN Date: FINANCIAL CRITIQUE OF PAST YEAR Successes! 1. 2. 3. 4. 5. Areas for Improvement 1. 2. 3. 4. 5.! ANALYSIS OF INCOME AND EXPENSES Annual Income: Annual Expenses: Past 12 Months Annual Income: Annual Expenses: Next 12 Months Surplus or Deficit: Surplus: 15 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
SAVINGS AND RETIREMENT WORKSHEET Time Frame Goal Total Cost Existing Savings For Goal Savings Needed to Reach Goal Plan to Achieve Goal Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 16
THE VALUES CIRCLE CREATE YOUR OWN VALUES CIRCLE The circle lays out what top five values are most important and what drives the decisions you make everyday. Don t confuse goals for values. Wanting to be rich is a goal but wanting security would be the value. Hint: Review the values assessment results from page 2 in your 1Life Mastery Life Plan. 17 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials
MY LONG TERM FINANCIAL PLAN Value Time Frame Goal Total Cost Existing Savings For Goal Savings Needed to Reach Goal Plan to Achieve Goal Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials 18
Congratulations! You have finished our 1Life Mastery Program! We hope you have profited from the journey, emotionally, physically, mentally, and financially! Rest assured, if you continue to work your plan, there is no way you cannot succeed. You truly can do anything you put your mind, and heart, to! May you be a lifelong learner and enjoy all the best life has to offer while living your life full out, achieving your dreams, and helping others along the same journey. We would like to ask you three things: 1. Please forward the link for the course to someone you know will benefit! 2. Please post in our online community and let us know how you are! 3. Please drop us a line and let us know what you think of the program, and how we can improve it. Thank you, Your 1Life Fully Lived Team 19 Visit www.1lifefullylived.org to access complete 1Life Mastery course instructions and other related materials