Wealth Management Financial Planning for the 21st Century

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Wealth ManagementFinancial Planning for the
21st Century
Stephen J. Mayor Senior Investment Management
Specialist/Financial Consultant
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Introduction

• A fast-paced world produces complex issues
• Tax planning
• Risk management
• Consumer credit
• Estate planning
• Charitable giving

• A new need arises Wealth Management
• Traditional investment-related services
• PLUS
• Financial planning
• On-going advice coordination
• Specialized services

Smith Barney does not provide tax or legal
advice. Please consult your tax and/or legal
advisor for such guidance.
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Most Important Financial Goals Investors by Age
Group
Source Spectrem Group, Ultra High Net Worth
Survey 2003
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The Financial Life Cycle

• Wealth accumulation
• Primary focus Savings and capital growth
• to meet long-term financial objectives

• Wealth preservation
• Focus begins to shift from asset growth to
  managing personal and portfolio risk
  appropriately

• Wealth utilization
• Funding specific needs. Requires continued focus
  on balancing capital growth and current income

• Wealth transfer
• Minimize tax costs while achieving personal
• and/or charitable endowment goals

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Todays Financial Market

• Evolution within the Financial Industry
• Institutional market Pension funds, foundations,
  private trusts, HNW individuals
• Retail market individual investors

• Institutional Focus
• Due diligence, board liability, pre-tax returns,
  risk-adjusted returns, asset/liability matching

• Retail Focus
• Commission-based sales, basic financial advice,
  simple asset allocation, short-term performance

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Market Component Convergence
Source Consulting Group
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The Wealth Management Model

• Multiple Service Functions Require Wealth
  Advisors in Different Areas
• Tax planning
• Portfolio management
• Debt structure
• Estate planning

• Role of the Financial Consultant
• Lead role in coordinating wealth advisor input to
  clients financial needs
• Plan broad wealth management strategy
• Clearinghouse for financial information
• Primary point of contact with wealth advisors

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The Old Service Model
Source Consulting Group
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The New Service Model
Source Consulting Group
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Putting the Pieces Together

• Personal net worth analysis
• Mortgage, car loan, credit-card balances
• Savings and investments
• Real estate and tangible assets

• Asset allocation analysis
• Diversification
• Risk tolerance
• Personal factors

When used wisely, borrowing can be beneficial
to your total asset management. The mortgage and
home equity programs are not available in all
states. All loans are made by Citibank F.S.B.,
Citibank N.A., Citibank (West), FSB, or
CitiMortgage Inc., equal housing lenders, and are
subject to Citibanks or CitiMortgage, Inc.s
mortgage qualifications. CitiMortgage Inc. does
business as Citigroup Mortgage in MT and NM. In
CT and NJ, Citigroup Global Markets Inc. is the
BROKER ONLY, NOT THE LENDER. Citigroup Global
Markets Inc. is a registered mortgage broker, NYS
Banking Department. In AZ, Citigroup Global
Markets Inc. is a licensed Mortgage Broker (Lic.
No. 0903067.) Citigroup Global Markets Inc.,
Citibank F.S.B., Citibank N.A., Citibank (West),
FSB, Citibank New York State and CitiMortgage,
Inc. are subsidiaries of Citigroup Inc.

• Education funding analysis
• Projected future tuition costs
• Funding strategy
• Section 529, other tax-favored vehicles

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Putting the Pieces Together

• Employee stock option analysis
• Exercise strategies
• Hedging strategies
• Diversification strategies

• Retirement analysis
• Clarify objectives
• Estimate future resources
• Calculate probability of meeting goals

• Estate planning analysis
• Protect assets
• Reduce tax costs
• Fund legacies

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Special Services for High Net Worth Investors

• Insurance planning
• Charitable giving
• Trust services
• Private banking
• Investment banking

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What Smith Barney Offers

• What is Smith Barneys Consulting Group?
• Nations oldest investment consulting
  organization
• Serves both institutional and individual
  investors
• Access to a wide range of products and services

• Open Architecture model
• Smith Barney proprietary offerings
• Independent money management firms

• Individually managed accounts
• Customized portfolios
• Flexibility to manage tax liabilities
• Best of breed integrated portfolios

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Core and Satellite Approach
Source Consulting Group
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My Goals as a Financial Consultant

• Practical, in-depth advice
• Match clients goals and tolerance for risk
• Choose appropriate investment vehicles
• Monitor portfolio performance over time

• Financial planning services
• Using planning resources provided by Smith Barney
  
• Investment tools developed by Consulting Group

• Wealth management
• Primary financial advisor
• Coordinate with other members of financial team

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The Investment Process
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Conclusions

• Investors want and need a more comprehensive,
  integrated financial strategy to manage their
  wealth
• Investors are looking for a qualified advisor to
  coordinate and help them manage that strategy
• Smith Barney provides a wealth management model
  for serving the complex needs of todays
  individual investors
• Smith Barney and Stephen Mayor may play a
  critical role in implementing that model

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Important Smith Barney Disclosures
Although the statements of fact and data in this
presentation have been obtained from, and are
based upon, sources that the Firm believes to be
reliable, we do not guarantee their accuracy, and
any such information may be incomplete or
condensed. All opinions included in this
presentation constitute the Firms judgment as of
the date of this presentation and are subject to
change without notice. This presentation is for
informational purposes only and is not intended
as an offer or solicitation with respect to the
purchase or sale of any security. Past
performance is not a guarantee of future results.
Smith Barney and Consulting Group are
divisions of Citigroup Global Markets Inc. Smith
Barney is a service mark of Citigroup Global
Markets Inc. and its affiliates and is used and
registered throughout the world. CITIGROUP and
the Umbrella Device are trademarks and service
marks of Citicorp or its affiliates and are used
and registered throughout the world. Citigroup
Global Markets Inc. is a member of the Securities
Investor Protection Corporation (SIPC). Trust
services are proved by one of the following
entities Citibank, N.A. Citicorp Trust, N.A.
(California) Citicorp Trust, N.A. (Florida)
Citicorp Trust South Dakota Citicorp Trust Bank,
fsb or Smith Bareny Corporate Trust Company.
The entities that provide trust services are
referred to collectively as Citigroup
Trust. Smith Barney does not provide tax or
legal advice. Please consult your tax and/or
legal advisor for such guidance.