Modern Woodmen Sample Financial Plan

8/13/2019 Modern Woodmen Sample Financial Plan

1/17


2/17

Table of ContentsTable of Contents

Introduction 1Personal Information Summary 3Financial Needs - Client A Dies 5

Survivor Needs Analysis Detail - Client A Dies 6Financial Needs - Client B Dies 8Survivor Needs Analysis Detail - Client B Dies 9College Needs Analysis 11College Needs Analysis Detail 12Retirement Analysis 13Retirement Needs Analysis Details 14Your Retirement Timeline 15


3/17

Introduction IntroductionUnderstanding your needsWhen thinking about your future financial security, it is important to set

goals, initiate action, and periodicallyreview your progress.

Remember...a sound financial strategycan be more important than a lifetime of work!

This analysis uses the information youhave shared about your current

financial situation and your goals for the future.

The following pages analyze your needs:

In the event of death ...can help reach your goals. For college funding For your retirement years

Important Note...

This illustration is based on the information you provided with regard to your financial needs and objectives. It isintended to provide only broad, general guidelines which may be helpful in assessing and making decisions aboutfinancial products (such as securities or insurance) and services available to you that may help meet those needs andobjectives. This material may also contain general educational topics about investing and financial matters. It ismost important that you understand that your actual experience will differ from this illustration. That is why youshould reassess your situation with updated data and assumptions on a periodic basis.

This illustration estimates future asset values based on rates of return provided by you. It is not intended to beinvestment advice or a projection of future investment performance. No one can foresee the future and, it is not a

projection of the potential return of any investment, nor is it a projection of future inflation rates or the state of theworld or domestic economy. You should seek the guidance of a financial or investment professional before

proceeding with an investment decision.

Although this illustration may contain income tax calculations and legal concepts, it does not constitute tax or legaladvice. The application of some concepts may be considered practicing law and should, therefore, be handled by anattorney, while other concepts may require the guidance of a tax or accounting advisor.

Profiles Forecaster Ben and Jen Woodmen

Continued...

Page 1 of 15Modern Woodmen of America

Presented by: Mr. Ryan L. Phillips, FICDecember 9, 2013


4/17

In creating the illustration certain assumptions were made with respect to investment returns, the economy, andyour situation. The reports and graphics included are directly dependent on the quality and the accuracy of the dataand assumptions (including rates of return) furnished by you.

Where future rates of return are assumed, these returns do not reflect the fees and charges associated withinvestments, which would reduce the results. You are encouraged to review and consider performance information,which you can request from your investment professional, for the mutual funds and other securities that may bereferenced in this material when assuming any future rates of return. Keep in mind that past performance is not aguarantee of future results. A current prospectus must be read carefully when considering any investment insecurities.

No liability is assumed resulting from the use of the information contained in this financial illustration.Responsibilities for financial decisions are assumed by you.





5/17

Personal Information Summary Personal Information SummaryThis financial needs analysis report is based on the information and assumptions you provided.This financial needs analysis report is based on the information and assumptions you provided.

Personal DataPersonal DataContributing to Annual

Name Date of Birth Social Security Employment Income

Ben Woodmen 01/20/1982 Yes $76,000Jen Woodmen 02/16/1984 Yes $25,000

Married: Yes

Address123 Sunset BlvdRock Island, IL 61201 Phone: (309) 109-8765

E-Mail [email protected]

OccupationOccupationBen: Buildings Plus, Inc. Jen: Sunnyside School Dist.

Engineer Teacher (309) 109-8765 (309) 567-8910

ChildrenChildren Name Date of BirthRicky 02/04/2006Lucy 12/25/2008

Bank Accounts and InvestmentsBank Accounts and Investments Asset Rate of Monthly Savings

Owner Name Amount Return Savings IncreaseBen Bank Savings $7,000 1.50% $0 0.00%

Total $7,000 Monthly Savings... $0 Average Rate of Return.. 1.50%

Retirement FundsRetirement Funds Asset Rate of Monthly Savings Company

Owner Name Amount Return Savings Increase MatchBen 401K $36,000 7.00% $380 3.00% $190Jen TSA $7,500 6.50% $104 3.00% $0

Total $43,500 Monthly Savings... $484 Average Rate of Return.. 6.91%

Assets and LiabilitiesAssets and Liabilities

Market Current Monthly Interest Type Name Value Liability Payment Rate

Residence US Bank $135,000 $110,000 $750 5.00%Personal Property Camper $4,000 $0 $0 0.00%Personal Property Check Account $2,500 $0 $0 0.00%Personal Property Vehicle $8,000 $0 $0 0.00%Credit Cards & Personal Loans Credit Card $0 $2,000 $50 10.50%Credit Cards & Personal Loans Student Loan $0 $7,000 $290 6.00%Credit Cards & Personal Loans Vehicle $0 $6,000 $250 7.00%


Continued...




6/17

Other Income SourcesOther Income Sources Monthly/ Begins Ends Annual Today's Value/ Available for

Name Description Amount Lump Sum at Age at Age Increase Future Value SurvivorsBen Pension Plan $2,216 Monthly 65 65 3.00% Today's Yes

Needs In The Event Of DeathNeeds In The Event Of Death Income Needs Objective

With children at home: $6,313 per month (75.00% ) No children at home: $6,313 per month (75.00% )

Age to begin Survivor's SocialSecurity Retirement Benefits

67

Provide Income for 15 years Fund Children's Education Yes

Life Insurance PoliciesLife Insurance Policies Insurance Annual

Name Company Benefit Premium TypeBen Group $76,000 $0 GroupBen Prudential $100,000 $240 TermJen Group $20,000 $0 GroupJen Prudential $10,000 $0 Whole Life

College FundingCollege Funding Annual Amount Years Percent Want

Child's Name School (in Today's Dollars) Needed To ProvideRicky Unknown $10,000 4 60%Lucy Unknown $10,000 4 60%

Total Funds Monthly Rate of Presently Available Savings Return$14,000 $100 4.00%

Retirement NeedsRetirement NeedsBen Jen

Desired Retirement Age 65 63

Social Security Retirement Benefits Begin Age 67 67 Employer Offers Retirement Plans Yes Yes Maximum amount being contributed No No Percentage of pre-retirement income during retirement 75.00%

Assumptions Used In This AnalysisAssumptions Used In This Analysis Rate of Return on Assets

During Retirement.... 6.00% In the Event of Death... 6.00% For College Needs....... 4.00%

Number of month's income to set aside for emergency reserves.... 3

Long-term inflation rate. 4.00%Social Security inflation rate. 4.00%

Long-term inflation rate for College Costs... 6.00% Life expectancy age. 90 Final Expenses.... $10,000





7/17

Financial Needs in the Event of Ben's Death Financial Needs in the Event of Ben's DeathTotal Immediate Cash Needs: $222,959Total Immediate Cash Needs: $222,959This survivor needs analysis shows the impact

Ben's death can have on your family. Funds need

to be available for both Cash Needs and a family'scontinuing Income Needs. Ben and Jen, you need $222,959 for your immediate cash needs. Cash

Needs include:

A Final Expenses fund for medical, legal, funeral, and other expenses

A Debt Payment Fund to pay off your debts,including your mortgage

An Emergency Reserve Fund for unexpected bills not readily payable from current income

An Education Fund to provide for your children's education After a death, income generally comes from four

different sources:

Social Security Savings and Investments Life Insurance Proceeds

You indicated that 75% of total household income will be needed after the death of a wageearner while there are children at home, and 75% thereafter.

Based on the above assumptions, this survivor needs analysis suggests that you may not meet

your goals. Your current household income is$101,000. If Ben were to die today, it isestimated that your assets would be sufficient tomeet your family's Immediate Cash Needs.

However, your family's Income Needs will only

be 85% satisfied. To provide for your family'sneeds in the event of death for 15 years you will need approximately $146,291 of additional capital.

Total Income Needs: $163,831Total Income Needs: $163,831

Summary $222,959Cash Needs:

163,831Income Needs:

240,500 Less Present Funds

Additional Capital Needs $146,291

Survivor's Earnings

$140,000

$120,000

$100,000

$80,000

$60,000

$40,000

$20,000

$0413937353331 4329

$10,000$125,000

$25,250$62,709

A n n u a

l I n c o m e

D e s

i r e

d

Jen's Age

Final Expenses FundDebt Payment Fund

Emergency FundEducation Fund

Capital Withdrawals Other IncomeSocial SecurityDeficit





8/17

Survivor Needs Analysis Detail Survivor Needs Analysis Detail In the Event of Ben's Death In the Event of Ben's DeathAssumptionsAssumptionsIncome Replacement % of Total Household Income with Dependents 75%

Income Replacement % of Total Household Income without Dependents 75%Inflation 4.00%Survivor Rate of Return 6.00%Age to begin Jen's Social Security Retirement Benefits 67

Number of years to provide income 15

Income ObjectiveIncome ObjectiveJen's Annual Need Annual Need CapitalAge Income Need % (Today's Dollars) (Future Dollars) Value29 75% $75,750 $75,750 $915,12743 75% 75,750 131,174 56,498

Total Capital Needed to Provide Income ObjectiveTotal Capital Needed to Provide Income Objective $971,624$971,624

Income SourcesIncome SourcesJen's Payment FirstIncome In Year's CapitalSources Today's Dollars From To COLA Payment ValueEmployment $25,000 29 44 4.00% $25,000 $320,668Social Security 44,291 29 43 4.00% 44,291 487,125

Total Income SourcesTotal Income Sources $807,793$807,793

Capital Needed to Meet Income GoalsCapital Needed to Meet Income Goals $163,831$163,831

Immediate Cash NeedsImmediate Cash Needs Final Expenses $10,000

Debt Payment Fund $125,000Mortgage 110,000Credit Card 2,000Student Loan 7,000Vehicle 6,000

Emergency Reserve Fund $25,250

Education Fund $62,709Ricky: Lump Sum needed today $30,459$6,000 needed for 4 years starting in 11 years.Lucy: Lump Sum needed today $32,250$6,000 needed for 4 years starting in 14 years.


Continued...




9/17

Total Immediate Cash NeedsTotal Immediate Cash Needs $222,959$222,959

Total Capital Needed to Meet ObjectivesTotal Capital Needed to Meet Objectives $386,791$386,791

Capital AvailableCapital Available

Asset Name Market ValueEducation Funds $14,000Bank Savings 7,000401K 36,000TSA 7,500Life Insurance 176,000Total Capital AvailableTotal Capital Available $240,500$240,500

Additional Capital Needed to Meet ObjectivesAdditional Capital Needed to Meet Objectives $146,291$146,291

Profiles Forecaster Profiles Forecaster Ben and Jen WoodmenBen and Jen Woodmen

Page 7 of 15Page 7 of 15

Modern Woodmen of AmericaModern Woodmen of America

Presented by: Mr. Ryan L. Phillips, FICPresented by: Mr. Ryan L. Phillips, FIC

December 9, 2013December 9, 2013


10/17

Financial Needs in the Event of Jen's Death Financial Needs in the Event of Jen's DeathTotal Immediate Cash Needs: $222,959Total Immediate Cash Needs: $222,959This survivor needs analysis shows the impact

Jen's death can have on your family. Funds need

to be available for both Cash Needs and a family'scontinuing Income Needs. Ben and Jen, you need $222,959 for your immediate cash needs. Cash

Needs include:

A Final Expenses fund for medical, legal, funeral, and other expenses

A Debt Payment Fund to pay off your debts,including your mortgage

An Emergency Reserve Fund for unexpected bills not readily payable from current income

An Education Fund to provide for your children's education After a death, income generally comes from four

different sources:

Social Security Savings and Investments Life Insurance Proceeds

You indicated that 75% of total household income will be needed after the death of a wageearner while there are children at home, and 75% thereafter.

Based on the above assumptions, this survivor needs analysis suggests that you may not meet all of your goals. Your current household income is $101,000. If Jen were to die today, it is estimated that your assets would beinsufficient to meet your family's ImmediateCash Needs. Your family's income needs will

be satisfied for 15 years. To provide for your family's needs in the event of death you will need approximately $128,459 of additional capital.

Total Income Needs: $0Total Income Needs: $0

Summary $222,959Cash Needs:

0Income Needs:

94,500 Less Present Funds

Additional Capital Needs $128,459

Survivor's Earnings

$160,000

$140,000

$120,000

$100,000

$80,000

$60,000

$40,000

$20,000

$031 33 35 37 39 41 43 45

$10,000$125,000

$25,250$62,709

A n n u a

l I n c o m e

D e s

i r e

d

Ben's Age

Final Expenses FundDebt Payment Fund

Emergency FundEducation Fund

Social Security Other Income







11/17

Survivor Needs Analysis Detail Survivor Needs Analysis Detail In the Event of Jen's Death In the Event of Jen's DeathAssumptionsAssumptionsIncome Replacement % of Total Household Income with Dependents 75%

Income Replacement % of Total Household Income without Dependents 75%Inflation 4.00%Survivor Rate of Return 6.00%Age to begin Ben's Social Security Retirement Benefits 67

Number of years to provide income 15

Income ObjectiveIncome ObjectiveBen's Annual Need Annual Need CapitalAge Income Need % (Today's Dollars) (Future Dollars) Value31 75% $75,750 $75,750 $915,12745 75% 75,750 131,174 56,498

Total Capital Needed to Provide Income ObjectiveTotal Capital Needed to Provide Income Objective $971,624$971,624

Income SourcesIncome SourcesBen's Payment FirstIncome In Year's CapitalSources Today's Dollars From To COLA Payment ValueEmployment $76,000 31 46 4.00% $76,000 $974,831Social Security 19,095 31 45 4.00% 19,095 208,491

Total Income SourcesTotal Income Sources $1,183,322$1,183,322

Capital Needed to Meet Income GoalsCapital Needed to Meet Income Goals $0$0

Immediate Cash NeedsImmediate Cash Needs Final Expenses $10,000

Debt Payment Fund $125,000Mortgage 110,000Credit Card 2,000Student Loan 7,000Vehicle 6,000

Emergency Reserve Fund $25,250

Education Fund $62,709Ricky: Lump Sum needed today $30,459$6,000 needed for 4 years starting in 11 years.Lucy: Lump Sum needed today $32,250$6,000 needed for 4 years starting in 14 years.


Continued...




12/17

Total Immediate Cash NeedsTotal Immediate Cash Needs $222,959$222,959

Total Capital Needed to Meet ObjectivesTotal Capital Needed to Meet Objectives $222,959$222,959

Capital AvailableCapital Available

Asset Name Market ValueEducation Funds $14,000Bank Savings 7,000401K 36,000TSA 7,500Life Insurance 30,000Total Capital AvailableTotal Capital Available $94,500$94,500

Additional Capital Needed to Meet ObjectivesAdditional Capital Needed to Meet Objectives $128,459$128,459







13/17

College Needs AnalysisCollege Needs Analysis

Will you have enough money when it is timeto send your children to college? The

earlier you begin setting money aside for college, the more likely you are to achieve

your goals.

You currently have $14,000 set aside and you are saving $100 a month at 4.00% for college expenses.

This college needs analysis suggests that you may not meet your goals. In order to fully fund your children's college expenses,

you will need to begin saving an additional $227 a month. Projected College Costs

RickyLucy

Total

Total College Cost in Today's DollarsTotal College Cost in Today's Dollars

$49,82659,344

$109,169

Begin saving an additional $227 per month for the next 17years.

$30,000

$25,000

$20,000

$15,000

$10,000

$5,000

$03 4 51 2 76

Why should you begin pr eparin g for college needs now?

If you wait until it's time for college to begin, youlose the advantage of spreading the costs over many years.

If you have to borrow money to pay for college,the amount of the loan and interest will have tobe repaid.

If you start now, the interest earned on your savings will reduce the total amount that youneed to save.

LucyRicky

A n n u a

l N e e

d

College Years

Monthly savings alternative

$32,250$30,459

DeficitSavings and Investments







14/17

College Needs Analysis Detail College Needs Analysis Detail

Goal SummaryGoal SummaryPresent Present

Annual Need Years Number Value of Percentage Value of

Name/ (today's Until Years Total To Be Total Cost ToSchool Age Dollars) Needed Needed Cost Funded Be FundedRicky 7 $10,000 11 4 $50,765 60% $30,459

UnknownLucy 4 10,000 14 4 53,751 60% 32,250

Unknown

Present Value of Total NeedPresent Value of Total Need $62,709$62,709

Savings SummarySavings SummaryCurrent Savings $14,000Monthly Savings

$100 per month for 17 years at 4.00% grows to $29,049In today's dollars that is: $14,913

Present Value of SavingsPresent Value of Savings $28,913$28,913

Single Sum Needed Today to Fund ShortageSingle Sum Needed Today to Fund Shortage $33,796$33,796

Additional Monthly Savings RequiredAdditional Monthly Savings RequiredStarting Age Amount Needed

Ben's age 31 for 17 yearsBen's age 31 for 17 years $227$227

AssumptionsAssumptionsCollege Cost Inflation Rate 6.00%Average Rate of Return 4.00%This analysis assumes that savings will continue until the start of the last year of college.





15/17

79778381676575737169 Retirement Needs Analysis Retirement Needs Analysis

Will you have enough money when youretire? The earlier you begin setting money

aside, the more likely you are to achieve your retirement goals.

Retirement income generally comes fromthree different sources:

Social Security Employer Sponsored Plans Savings and Investments

This retirement analysis suggests that youmight not have enough money to retire. It is

estimated that your assets will be depleted byage 77. At that time, your remaining income sources will be limited to Social Security and only provide 52% of your income.

To provide for your desired retirement income, you will needadditional capital at retirement age 65. In order to meet thisneed, you should consider:

Saving more moneyEarning a higher return on your assets

If you are not able to accumulate this capital, you may needto consider:

Postponing your retirement, or Reducing your standard of living

This chart shows various options in order for you to meet your objectives. Basedon your current average rate of return of 6.79%, you would need to save anadditional $894 a month. Alternatively, if you could increase your average rate of return to 9.12%, your objectives would bemet. It is important to understand that inorder to achieve an increased rate of

return, it is likely you will face increasedrisk.

If these options are not attainable, work towards doing a little bit of both; savingmore money and earning a higher rate of return.

Save More or Earn MoreSave More or Earn More

Assumptions: Income increases at 4.00% annually. Rate of return during retirement is 6.00%. Social Security benefits increase at 4.00%.

$800,000

$600,000

$400,000

$200,000

$06563

8179

6967

8583

7371

8987

7775

$1,000

$800

$600

$400

$200$0

7.38% 9.12%8.54%7.96%6.79%

A n n u a l

I n c o m e

D e s

i r e

d

Ben's AgeJen's Age

A d d i t i o n a

l M o n

t h l y S a v

i n g s

Rate of Return on Savings and Investments

$894

$633

$398

$188

$0

Social SecurityDeficit Capital Withdrawals





16/17

Retirement Needs Analysis Detail Retirement Needs Analysis Detail Income ObjectiveIncome Objective

CurrentHousehold Annual Need Annual Need Capital

Income (Today's Dollars) (At Retirement) Value

At Ben's Age65

$101,000 $75,750 $287,419 $5,964,429

Total Value of Income ObjectiveTotal Value of Income Objective $5,964,429$5,964,429

Income SourcesIncome SourcesPayment First

Income In Year's CapitalSources Today's Dollars From To COLA Payment ValueBen's SocialSecurity

$26,158 67 90 4.00% $107,349 $1,749,198

Jen's SocialSecurity

13,329 67 90 4.00% 59,163 916,323

Total Income SourcesTotal Income Sources $2,665,520$2,665,520

Capital Needed to Meet ObjectivesCapital Needed to Meet Objectives $3,298,909$3,298,909

Capital AvailableCapital AvailableAssumed Total Assumed

Market Rate Annual Savings Value AtAsset Name Value of Return Contribution Increase RetirementTSA $7,500 6.50% $1,248 3.00% $277,002401K 36,000 7.00% 6,840 3.00% 1,644,811Bank Savings 7,000 1.50% 0 0.00% 11,613Total Capital AvailableTotal Capital Available $1,933,426$1,933,426

Additional Capital Needed to Meet ObjectivesAdditional Capital Needed to Meet Objectives $1,365,483$1,365,483

AssumptionsAssumptionsIncome Replacement at Retirement in the year 2047 75%Inflation 4.00%Rate of Return for Assets during Retirement 6.00%Mortality assumed for Ben and Jen 90 / 90





17/17

Your Retirement TimelineYour Retirement TimelineBeginning Balance: $1,933,426

Annual Income Income Social Other Surplus/ Investment Asset

Ages Desired Security Income (Shortage) Growth Balance

65/63 $287,419 $0 $0 ($287,419) $106,748 $1,752,75466/64 298,916 0 0 (298,916) 95,537 1,549,37567/65 310,873 107,349 0 (203,524) 86,407 1,432,25768/66 323,308 111,643 0 (211,665) 79,118 1,299,71069/67 336,240 175,272 0 (160,968) 72,798 1,211,53970/68 349,690 182,283 0 (167,407) 67,300 1,111,43271/69 363,677 189,574 0 (174,103) 61,078 998,40772/70 378,224 197,157 0 (181,067) 54,072 871,41273/71 393,353 205,043 0 (188,310) 46,219 729,32174/72 409,088 213,245 0 (195,842) 37,451 570,93075/73 425,451 221,775 0 (203,676) 27,695 394,949

76/74 442,469 230,646 0 (211,823) 16,874 199,99977/75 460,168 239,872 0 (220,296) 4,904 (15,393)78/76 478,575 249,467 0 (229,108) 0 (244,501)79/77 497,718 259,445 0 (238,272) 0 (482,773)80/78 517,626 269,823 0 (247,803) 0 (730,576)81/79 538,331 280,616 0 (257,715) 0 (988,291)82/80 559,865 291,841 0 (268,024) 0 (1,256,315)83/81 582,259 303,514 0 (278,745) 0 (1,535,060)84/82 605,549 315,655 0 (289,895) 0 (1,824,955)85/83 629,771 328,281 0 (301,490) 0 (2,126,445)86/84 654,962 341,412 0 (313,550) 0 (2,439,995)87/85 681,161 355,069 0 (326,092) 0 (2,766,087)88/86 708,407 369,271 0 (339,136) 0 (3,105,223)89/87 736,744 384,042 0 (352,701) 0 (3,457,924)--/88 766,213 264,584 0 (501,629) 0 (3,959,553)--/89 796,862 275,167 0 (521,694) 0 (4,481,248)


Page 15 of 15 Presented by: Mr. Ryan L. Phillips, FIC

Modern Woodmen Sample Financial Plan

Documents