Will you outlive your savings

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Will you outlive your savings?
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Seminar format

• The seminar will last about 60 minutes.
• Please turn off your cell phones and pagers
• The bathrooms are located in..
• No unauthorized audio orvideo recordings of this
  seminarare allowed.
• A meal will be served after the seminar

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Who attends this seminar

• People who are sick of losing money, want to
  preserve principal and want to concentrate on
  living life vs the constant details of money.
• And people who were slightly curious, were
  tempted by the gourmet meal and said, what the
  heck.

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What Are The Three Greatest Concerns To Retirees?

• Out Living Your Retirement Income
• Preservation of Principal
• Liquidity

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Today youll learn about

• Simple IRA strategies that will generate more for
  you and your family.
• How to generate more money safely.
• How to assure a lifetime income so you dont
  outlive your money.
• Simple strategies that protect your principal,
  produce good yields and provide liquidity.

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I guarantee that you will see ideas that you will
want to implement.

• BUT YOU MUST MAKE
• AN APPOINTMENT TO BENEFIT.

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How do we get paid?

• We do not charge fees nor do we sell or recommend
  securities.
  
• 100 of your invested assets will be working for
  you from day one.
• We get paid by the firms that you choose to
  handle your money.

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The Money Cycle

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Three Stages to the Money Cycle

• Accumulation
• Preservation
• Distribution

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Money Cycle
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Make your s last a lifetime

• Seek principal preservation.
• Growth secondary.

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IRA strategies

• Simple and safe

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Simplify -These Can ALL Be Combined into 1
Account

• 403 (b)
• SEP
• Traditional IRA
• Rollover IRA

• Pension
• Profit Sharing
• 401(k)
• Keogh
• 457 plans

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Your IRA

• Taxes, Taxes, Taxes

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A Way to Reduce Taxes on Your IRA
Distributions--Use the New Tables - 1,000,000
Account

• Single Life Expectancy IRS Tables

• Old New
• IRA divisor for male age 80 9.5 18.7
• Required Distribution
  105,263 53,476

Source 2001 IRS Publication 590 and US Treasury
Final Regulations 4/17/02
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STRETCH IRA
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Passing IRAs to Next Generation

• Son, age 42, inherits 300,000 IRA
• Takes his mandatory distributions over his
  40-year life span.
• Collects about 1,200,000 over his lifetime
  (assumes he earns 6).

AssumptionsIRA earns 6 and distributions taken
per IRS publication 590, 2001
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Your Beneficiaries

• Who inherits your money?
• The Government
• Your Heirs

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Selecting Beneficiaries

• Never Your Estate
• Always a person or trust which meets your
  criteria
• Dont let Your Custodian ruin your plans

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Dont let Your Custodian Ruin Your Plans
Primary beneficiaries Your sons
Jack
Tom
Secondary beneficiaries Your grandsons
Bob
Dan
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Selecting Beneficiaries

• IRA Asset Trust makes your IRA.
• Creditor proof
• Divorce proof
• This is where to count charities into your plans
• IRA can be split up after death (and should be)

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Lower your taxeson personally owned dollars (not
your IRA)
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Lower your taxes

• Split your money into two parts
• Part A Short Term Money
• Spend first, most is return of
• principal and is tax free.
• Part B Long Term Money
• Defer, pay taxes when you spend it.

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An example

• Split your money into two parts
• Start with 100,000.
• 25,000 into money market fund.
• Spend 5,000/year for 5 years, most is return
• of principal and is tax free.
• 75,000 into deferred account such as an annuity.
  
• Let it grow for 5 years, pay taxes when you
• spend it. No taxation while deferring.

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Additional benefit of splitting your money.Save
on social security taxes.
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PROBLEMInterest income earned and credited on
most investments such as mutual funds, savings
accounts, CDs, bonds, etc. is reportable as
provisional income, which may increase income
tax on Social Security Benefits.
Investment Effects of Social Security Benefits
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Taxation of Social Security Benefits
Tax Table
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Investment Effects of Social Security Benefits
SOLUTIONTax-deferred accounts such as annuities
are not used in the Social Security taxation
calculation. Thus, fewer taxes will be paid and
more of your Social Security income benefits will
come to you.
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Why Pay Taxes On Money That You Dont
Need?John D. Rockefeller
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Will you outlive your savings?

• Your savings must last you for a lifetime.
• Most will succeed when they strategize to avoid
  losses.

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Financial Risk

• Are your assets subject to principal fluctuation?
• Bond funds, stock funds, real estate funds and
  mortgage base funds are subject to principal
  risk.
• Are any of your assets principal protected?

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Safe Assets

• Money market funds
• CDs
• Annuities

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At Risk Assets

• Stocks
• Real Estate
• Bond funds
• What percentage of your assets are safe?

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Many events can cause the stock and bond market
to drop quickly

• This effects retirees more than any other group.

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Which has a greater effect on your life?

• A 50 gain.
• A 50 loss.

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50 gain

• Nice , but not life changing

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50 loss

• Can be devastating
• Drop membership in your valued club
• Cancel travel plans

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Seniors And The Stock Market

• Can You Afford More Losses ?

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AARP STUDY

• AARP reports that over 77 of its members lost
  value in their stock portfolio since 2000. Of
  those experiencing losses
• 25 Reported losses of 25-50
• 9 Reported losses of more than 50
• 8 Reported losses of more than 75
• (ending 6/1/2003)

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New Math

• Question When is -50 100 0

If you lost 50 last year due to stock market
declines, then you would need 100 gain this year
to break even 100,000 x 50 loss 50,000
50,000 x 100 gain 100,000
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LOSSES HAVE GREATER IMPACT THAN DO GAINS
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Keep market gains, protect against a loss

• Recent losses have created a new type of
  insurance called stock market loss insurance.
• Pay an insurance premium and your portfolio is
  protected against a loss (like home, health or
  auto insurance).
• In some cases, the insurance company will accept
  part of your gains in lieu of payment.

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Equity Indexed Annuities (EIA)

• Index your value to the stock market (potential
  double digit returns)
• Provide you with a minimum guaranteed return
  (cant lose principal) even if market declines
• Allow for liquidity as your needs change and
• Grows tax deferred

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Standard Poors 500
Following is an example of companies in the Index

• General Electric
• Microsoft Corp.
• Coca-Cola Co.
• Intel Corp.
• Johnson Johnson
• Procter Gamble
• General Mills
• Walt Disney Co.
•  

• Gillette Co.
• Ford Motor
• Target
• Home Depot
• American Express
• Viacom Inc.
• Fannie Mae.
• Hewlett-Packard

• Source - www.spglobal.com/sp500.xls
• SP and SP 500 are trademarks of the
  McGraw-Hill Companies, Inc. Index annuities are
  not sponsored, endorsed, sold or promoted by
  Standard Poors, and Standard Poors makes no
  representation regarding the advisability of
  purchasing Index annuities. Products not
  approved in all states.

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SP 500 vs. Mutual Funds Strong Market

• Invest 100,000 in 1988
• Average mutual fund grows to 422,585.
• SP 500 grows to 579,175.

Source Morningstar average yield of 4851 domestic
equity mutual funds, Bloomberg, LP. SP and
SP 500 are trademarks of the McGraw-Hill
Companies, Inc. Index annuities are not
sponsored, endorsed, sold or promoted by Standard
Poors, and Standard and Poors makes no
representation regarding the advisability of
purchasing Index annuities. Products not
approved in all states
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Regardless of the EIA product design, all EIAs

• Provide the downside protection
• Forfeit some upside potential
• Example if the market goes up you get only 70
  of the gains, but none of the losses.

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EIA Example

• Insurance company takes 30 of your gains, you
  keep 70
• Example.
• If the market rises 20, you get 14.
• If the market falls 20, you dont lose a dime.
• (Indicate interest on your RCA form)

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1 Million Umbrella
Auto/Liability Home Owners/Liability
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Long-Term Care3 ways to cover long-term care

• Self-Insure ( Personal Assets )
• Medicaid ( Spend down to welfare )
• Long-Term Care Insurance

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Long-term care
A year in a nursing home now averages more than
40,000 and can exceed 100,000 in some parts of
the country The Wall Street Journal 3/31/99
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Long-term care
After the age of 65, Americans have more than a
70 chance of needing some form of long-term
care American Society on Aging 5/23/2003
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Property Owners

• Is most of your net worth in property?
• Need cash? Two choices.
• Sell your home
• Reverse mortgage (loan you never repay until you
  sell your home).

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Reverse Mortgages
Bank lends you cash. Never repay mortgage while
you own the home. The mortgage grows. When home
sold, the mortgage is repaid.
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Reverse Mortgages

• Cost
• High mortgage rates.
• Lose equity in your home.
• Example Borrow 100,000, 10 years later at 7
  rate, balance at 200,000.

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An attractive alternative to a reverse mortgage

• Low interest rate of close to 1.
• Example Borrow 100,000, 10 years later at 1
  rate, balance at about 110,000.

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Borrow 100,000 today
1) 10 years later loan grows to about 110,000
. 2) Could be offset by home appreciation of
110,000. 3) Possible no loss of equity.
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Where Do You Go From Here?

• Do it yourself.
• Work with others.
• Procrastinate.
• WORK WITH ME.

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Take advantage of Your Free Financial Checkup By
Scheduling an Appointment Today!!
Dont Procrastinate
Please complete your retirement call to action
form
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What Youve Learned

• Keep Market Gains, protect against a loss
• A method to generate cash flow from your home.
• Change your objective from accumulation to asset
  preservation.
• Split your money into two parts to reduce taxes.
• Long term care and an umbrella policy, a nice
  combination.

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Your financial advisor

• Has your advisor helped you protect your savings?
  
• Did your advisor/assets eliminate fluctuations
  and risks?

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What would your advisor say?

• Your current advisor may assure you that you are
  on the right track, you dont need to make any
  changes. He/she will do everything within his/her
  power so that you will do nothing!
• Give us the opportunity to help you succeed
  where others have failed or their performance was
  lackluster!

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The Appointment

• participate in the stock market without the
  downside risk.
• derive the maximum from your home equity.
• create more income and less taxation from your
  safe investments.
• provide an income stream for life.
• getting the most from your IRA.
• Protect your savings with long term care
  insurance and an umbrella policy.

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Set an Appointment form

• Name _________
• Address _______ Please take a
• Phone_________ moment to fill out
• I Am Interested In this appointment form.
• See preset appt time on back of my card.
• The Best Time For My Appointment Is

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Retirement call to Action

• This form allows you to tell us which retirement
  strategies you would like to discuss in your
  complimentary consultation
• Please check the topics on which you would like
  more information
• Higher liquid rates without principal risk
• Enjoy stock market gains without losses
• Derive the maximum from your home equity
• Leave your assets, credit proof and tax free to
  your heirs

• Name ______________________ Spouse_______________
  ________
• Address __________________________________________
  ______
• City_______________________________________
• Phone __________________________ Home or Work
• The time on the back of my card is fine.
• Sorry, cant make it

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For Those Making An APPOINTMENT(hopefully thats
everyone)

• please make sure you bring your financial
  statements.

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Where is my office

• 1 Main Street, Kansas City
• Located next to
• Parking

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If you seek protection of principal,
liquidity, and a chance to make higher yields
------------------take
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Lets eat! ( please turn in your appointment
forms now)