Wealth Managers LLP

Integrated Financial Plan

The Carter Family Jim Carter Jane Carter Lydia Carter

Prepared Courtesy of Virginia Commonwealth University Team Ridge Stanislas Riley Baldus Ramzy Ismail

Table Of Contents

>Disclaimer >Letter of Engagement >Investment Policy Statement >Goals >Cash Flow >Education >Insurance >Recommendations

Disclaimer It is imperative that you review your financial plan regularly to ensure it is up-to-date and addresses your current needs. It is also important to look at a few different scenarios to get an idea of the impact of various assumptions on your planning objectives. Information provided in the attached report is general in nature and should not be construed as providing legal, accounting or tax advice. Should you have any specific questions and/or issues in these areas, please consult your legal, tax and/or accounting advisor.

Letter of Engagement
Mr. And Ms. Carter, We are pleased that you have sought the counsel of our firm, Wealth Managers LLP in securing your financial future. As Certified Financial Planners we have the expertise to make your journey into and beyond retirement sound and secure. Before making any recommendation, I must first have a complete picture of your current financial situation. The information I need deals with, but isnt necessarily limited to, your: assets, liabilities, income, expenses, tax position, returns, investment statements, will and power of attorney, insurance coverage, pension plans and group benefits. If we are unable to obtain the information we require, you should understand that it could prevent us from giving you appropriate advice. When considering the various financial strategies available in your particular situation, we may be required to make one or more assumptions. These assumptions may include, your anticipated retirement age, life expectancy, retirement income requirements, government benefits, time horizons, special needs, rates of return and inflation and income tax rates. Any assumptions made will be reasonable and realistic and disclosed in your financial plan. Having reviewed your financial situation, we will prepare a written financial plan for you to review. When discussing this report with you, I will do so in such a way so that you are able to understand: advantages, disadvantages, costs and risks of the various alternatives, the time sensitivity of the recommendations, the consequences of taking no action and the impact of a change in the assumptions on the projected results. This financial plan is meant to give you a better understanding of what you may expect from the financial planning process, and what our respective obligations are within that process. Since we offer both mutual funds and insurance products, I work in an agent-principal relationship with different companies. If, subsequent to our initial engagement, there are any changes to my business affiliations or agency relationships that may have an affect on our relationship, I will inform you. We required to declare any interest that may prevent us from offering objective advice. We are unaware of any current conflicts of interest and, should any conflicts appear in the future, you may rest assured that we will bring them to your attention immediately. We are bound by professional secrecy and may not disclose any of your confidential information without your written consent unless required to do so by law. It is agreed that the advisor will conduct a review with you in person every 12 months. In the event of changes that may affect the your personal circumstances, the advisor will contact you by telephone or e-mail. Should your financial circumstances change (ie. as a result of marriage, birth of a child, or inheritance), contact your advisor as soon as possible. The services outlined previous are in accordance with my requirements. The terms set out are acceptable to me, and are hereby agreed to: Date:________________________________ Jim Carter____________________________ Jane Carter___________________________

I) Executive summary Purpose of IPS a) Purpose of this Invest Policy Statement is to help clearly identify, evaluate, and monitor the Carter Family retirement plan. The clients retirement plan is defined by the following sections: i) Clearly reiterates the clients personal values and preferences to investments ii) Establishes investment structure, defines asset classes and allocations iii) Encourages communication between all invested parties and defines individual responsibilities Explains investment framework, including: iv) Asset classes (1) Investment selection criteria v) Rebalancing and reinvestment policy, annual assessment of strategy, client touch points throughout, duration of services vi) Expected ranges of loss/return (1) Narrative of diversification vii) Clients evaluation of money manager (1) Monitoring investments with proper market index and Family Overview b) The Carter Family, a taxable entity. We will monitor $1,623,750 (73%) of assets. The client s total assets are worth $2,224,250. Jim 401k Jane 401k Joint brokerage Jim IRA Jane IRA Savings Checking COD s Ebay Total $783,900 $438,000 $250,300 $33,900 $100,400 $5,000 $5,250 $7,000 $6,000 $1,623,750

Retirement Goals i) Retire at 62 ii) Pay for daughter s education as much as possible iii) Retain purchasing power through retirement iv) Travel after retirement v) Florida cottage Timeline vi) The nature of the investments is long term, beyond five years, and will be guided by historical data on returns. Capital value will fluctuate with short term market trends, but setting a long term investment strategy will decrease the chances of chasing small gains. Risk assessment optimal allocation c) Jim High 10% Medium 40% Low 50%

Jane High Medium Low 30% 40% 30%

FinaMetrica Risk Questionnaire and Analysisy Jim s attitudes, values and preferences o risk assessment places him in the bottom 24% risk group o Associate risk with danger ( narrative needs to rationalize our definition of calculated risk vs. financial risk) o More concerned with possible losses than possible gains o Risk=Danger o Little confidence in financial decision making o Based on risk analysis: high risk defined as stocks and real estate  Asset Allocation return/risk  High risk (10%), Medium (40%),Low (50%) o Buyer s remorse after major financial decisions ( reaffirm confidence in decision making through narrative) o With regards to investments, retaining purchasing power is of comparable importance to it not falling o Over 10 years, Expected average earnings equivalent to three times the rate of CD s y Jane s attitudes, values and preferences o Risk associated with opportunity with lingering uncertainty o Reasonable amount of confidence in financial decision making o Feel somewhat optimistic about major financial decisions o More concerned with gains than losses o Would begin to feel uncomfortable with a 20% drop in value o Based on risk analysis  Asset allocation return/risk  High (30%), Medium (40%), Low (30%) o Would choose to have 25% of loans at variable interest o Over 10 years, Expected average earnings equivalent to three times the rate of CD s

Monitoring and Reviews Due to short term market fluctuations that maybe effect annual evaluations, we will assess the success of the investment strategy from a long term perspective. Different asset classes will be measured against appropriate benchmarks. Quarterly: Assets under management will be reviewed on a quarterly basis to assess investment strategy. Any retirement goal changes or updates will be adjusted accordingly with our strategy. Annually: Performance reporting. All management fees will be assessed prior to performance review. Your Duties and Obligations As the steward of the assets under your control, it is your responsibility to provide your advisor with all relevant information on your financial condition. Any changes in your finances must be communicated promptly. I acknowledge and concur with this Investment Policy Statement (IPS): X ________________________________________ _________ Jim Carter Date X ________________________________________ _________ Jane Carter Date X ________________________________________ _________ Wealth Managers,LLP Date

Plan Summary
Net Worth Assets Liabilities Your Net Worth Cash Flow Family Income (after taxes) Total Expenses Your Net Cash Flow

$2,224,250 $444,900 $1,779,350

$130,900 $129,696 $1,204

Retirement Plan You have enough capital to sustain you through retirement: Capital required to fund your retirement Annual investment required to make up the above capital shortage $202,982 $0

Life Insurance Needs Total capital required Less current capital Life insurance need

Jim $512,313 $1,137,800 $-625,487

Jane $924,811 $808,400 $116,411

Disability Insurance Needs Total annual income sources Less annual expenses Annual income surplus/shortage

Jim Disabled $152,028 $129,696 $22,332

Jane Disabled $148,964 $129,696 $20,268

Estate Planning Do you have: A signed will? A signed power of attorney for financial affairs? A signed power of attorney for personal care?

Jim Yes No No

Jane Yes No No

Education Planning Lydia

Monthly Investment $

Amount to be Funded $-35,000

Goals and Objectives

   

Maintain your standard of living during retirement. Maintain your familys standard of living in the event of your death or disability. Provide for your childs education even if retirement has to be put off. Stay ahead of inflation. Buy a cottage for retirement. Retire at age 62. Travel extensively during early retirement.

 

Cash Flow Summary

income Family Income (Before-Tax) Income Taxes Family Income (After-Tax) expenses Housing Auto Food/Clothing Health Care Investments Loans Other Total Expenses NET INCOME
* Net income as a percentage of Family Income (Before-Tax)

annual amount $170,000 $39,860 $130,140 annual amount $41,064 $1,440 $8,160 $1,200 $19,620 $17,592 $40,620 $129,696 $444

percent amount 100% 23% 77% percent amount 32% 1% 6% 1% 15% 14% 31% 100% .34%*

Cash Flow Detail

income Jim Employment Before-tax income Income taxes After-tax income expenses Housing Rent/Mortgage Property Taxes Utilities Household Items Totals Monthly $2,317 $570 $435 $100 $3,322 Annually $27,804 $6,840 $5,220 $1,200 $39,864 Food/Clothing Food Clothing Monthly $600 $80 Annually $7,200 $960 Monthly $6,667 $6,667 $1,661 $5,006 Annually $80,000 $80,000 $19,932 $60,072 Jane Employment Before-tax income Income taxes After-tax income Monthly $7,500 $7,500 $1,661 $5,839 Annually $90,000 $72,000 $19,932 $70,068

Totals

$680

$8,160

Automobile Fuel Loan payments Totals

Monthly $120 $700 $820

Annually $1,440 $8,400 $9,840

Health Care Medical Expenses

Monthly $100

Annually $1,200

Totals

$100

$1,200

Cash Flow Detail continued ...

investments Jims 401 K Jims IRA Janes 401K Janes IRA Totals monthly $654 $131 $708 $142 $1,635 annually $7,848 $1,572 $8,496 $1,704 $19,620

loans Credit cards Student Loans Home Equity Totals other expense Child care Charitable Contributions Entertainment Vacations/Travel Dining Insurance Premiums Maintenance Exp. Other Exp. Totals

monthly $250 $141 $625 $1,016 monthly $1,100 $1,100 $60 $200 $60 $215 $200 $200 $3,135

annually $3,000 $1,692 $7,500 $12,192 annually $13,200 $13,200 $720 $2,400 $720 $2,580 $2,400 $2,400 $37,620

Lydia 4 Year Public College Funding Plan

Lydia's College Plan

Public four-year colleges charge, on average, $7,020 per year in tuition and fees for students who live in their state.

Today Average Annual College Inflation Rate Room and Board Annual Books and Supplies Transportation Personal Expenses Average Annual Public 4 Year College Cost of Attendance 2010 Year 1 2014 Year 2 2015 Year 3 2016 Year 4 2017 4 Year TOTAL 8% $6,000.00 $1,100.00 $1,000.00 $2,000.00 $17,120

September 1, 2014

$23,292.00 $23,292.00 $25,154.00 $27,167.00 $29,340.00 $104,953.00

Assumptions: 4 Year TOTAL COST OF ATTENDANCE Starting 2014 Current age Start school at age Years in school Public/Private College Tuition Inflation Rate Fund education using 1/3 Rule: One Third College Savings One Third Current Income One Third Financial Aid 4 Year TOTAL COST OF ATTENDANCE Starting 2014

$104,953.00 14 18 4 Years Public 8%

$34,984.00 $34,984.00 $34,984.00 $104,953.00

As the Carter's have the goal of putting Lydia through college via the maximum financial assistance possible, optionally 1/3 in financial aid assistance can be foregone to be replaced with 2/3 coming from College Savings.

Lydia 4 Year Public College Funding Plan

Life Insurance

Life insurance is one of the most important investments you can make to protect your familys financial security. It is used to guarantee that your family will have a lump sum to pay off large financial obligations, a source of income to meet daily living expenses and be able to meet future expenses such as your childrens education.

Life insurance benefits payable to a designated beneficiary are non-taxable and are not subject to probate fees. summary of life insurance needs Cash Needs Income Needs Jim $296,761 $609,216 $215,552 $924,811 Total Capital Required Less Current Capital $512,313 $808,400 $1,137,800 Jane $315,595

Life Insurance Need*

$-625,487

$116,411

* A positive amount indicates an insurance need, a negative amount indicates an insurance surplus.

Lydia 4 Year Public College Funding Plan

Life Insurance
Cash Needs Jim Funeral expenses Bills, accounts payable, loans Probate, legal, executor fees Education fund Total Amount $10,000 $204,654 $66,007 $16,100 $296,761 Jane Funeral expenses Bills, accounts payable, loans Probate, legal, executor fees Education fund Total Amount $10,000 $240,246 $46,449 $18,900 $315,595

Income Needs Jim Annual income need Less Surviving spouses income Pension survivor benefits Social Security Survivor Benefits Equals annual income need Capital to last for (years) Capital to generate income Amount $170,000 $90,000 $40,000 $13,056 $26,944 8 $215,552 Jane Annual income need Less Surviving spouses income Social Security Survivor Benefits Equals annual income need Capital to last for (years) Capital to generate income Amount $170,000 $80,000 $13,848 $76,152 8 $609,216

Jim Existing life insurance 401K IRA Total

Current Capital Amount $320,000 $783,900 $33,900 $1,137,800

Jane Existing life insurance 401K IRA Total

Amount $270,000 $438,000 $100,400 $808,400

Lydia 4 Year Public College Funding Plan

Disability Insurance

Disability insurance offers you protection against the possibility that you may not be able to meet your financial obligations - both family and business- due to accident or illness. Almost a third of all people now aged 35 will be disabled for at least six months before they reach 65. The chances that you will be disabled rather than die before you retire are almost three to one.

summary of your income needs in the case of disability

Annual Amounts Jim Disabled Jane Disabled

Total income sources Less: Expenses Income surplus/shortage*

$152,028 $129,696 $22,332

$148,964 $128,696 $20,268

* A negative amount indicates a disability insurance shortage, a positive amount indicates a surplus.

Lydia 4 Year Public College Funding Plan

Disability Insurance
Jim Income Source Spouses Income Government sources Current disability coverage Annual Amount $90,000 $16,428 $45,600 Jane Income Source Spouses Income Government sources Current disability coverage Annual Amount $80,000 $17,364 $51,600

Total Sources Less: expenses Equals: Surplus/Shortage

$152,028 $129,696 $22,332

Total Sources Less: expenses Equals: Surplus/Shortage

$148,964 $129,696 $19,268

Expenses Categories Housing Automobile Food/Clothing Investments Loans Other Total Expenses Annual Amount $41,064 $1,440 $8,160 $19,620 $17,592 $41,820 $129,696

Lydia 4 Year Public College Funding Plan

Recommendations
>Retirement funds- Stop making contributions to both your retirement accounts (Traditional IRA and 401k) which will free up annual positive cashflow of $27,000.

>Fund Lydias College With the extra cash that will be coming in you will be able to save $8,900 a year for 4 years until Lydia attends college. This will amount to $35,600 for Lydias college tuition in those 4 years paying for 1/3 of the costs while the other 2/3 will be paid by current income and financial aid.

>Congratulations, you will be able to travel extensively based on our analysis By saving up $4,000 a year for the next 9 years until retirement you will have $32,000 to be able to travel. This amount should be sufficient enough to travel during early retirement.

>Cottage You will be able to fund the purchase of a cottage by using your joint brokerage account. That account should be liquidated and you will be able to afford a down payment on a $300,000 cottage in Florida, brining monthly mortgage payments in line with you annual budget. It will be best to purchase a 15 year mortgage leaving the option to refinance into a longer term as your future budget may require.

>Investment All current retirement investments should be liquidated when retirement is near and placed in inflation protected securities such as Treasury Inflation Protected Securities (TIPS) or the Vanguard Inflation-Protected Securities Fund so that when you retire you will be able to live accordingly with inflation and retain your purchasing power. You will be able to withdraw an annual amount of $48,000 where as the rest of your annual income will come from social security benefits and Janes pension fund.

>Insurance - Jane requires an additional $116,411 in life insurance coverage. You should review your insurance needs annually to ensure that you have adequate coverage.

>Summary of estate documents: This is a summary of Jims essential estate planning documents: will (already prepared), power of attorney for your financial affairs (to be prepared), power of attorney for personal care (to be prepared). This is a summary of Janes essential estate planning documents: will (already prepared), power of attorney for your financial affairs (to be prepared), power of attorney for personal care (to be prepared). These documents should be reviewed annually to ensure that changes in your personal or financial circumstances are accounted for.

Lydia 4 Year Public College Funding Plan