1. Team Blue
July 25, 2013
Mr. & Mrs. Smith
Retirement Report
Prepared By:
Retirement Specialist
Taelor Mason Caleb Dyson
Wealth Manager Portfolio Manager
Kara Everhart Brian Fernander
Retirement Specialist Investment Strategist

2. 1
Table of Contents
Page Description Page
About TIAA-CREF & Executive Summary 2
TIAA-CREF and our specialties as well as an overview of our experience that best suits your needs and plans for the best
future possible
Steps Toward Achieving Your Retirement 3
Chronological steps that will help us help you navigate through retirement planning as well as tips for understanding
Mr. & Mrs. Smith’s Current Position 4
An overview of your current financial position with your current assets, current liabilities, cash flow etc.
Current Market Analysis 5
A market update based on things that are relevant to your future plans
Mr. & Mrs. Smith’s Current Position Report 9
Retirement Recommendations 10
An overview of everything we recommend that you do in order to prepare for retirement
Appendices 12
Support and clarification for everything that you will be encountering as you embark on your retirement planning
journey.
A1. Popular Tax Deferred Investment Vehicles 12
A2. Mr. & Mrs. Smith’s Cash Flow Statement 13
A3. Mr. & Mrs. Smith’s Statement of Net Worth 13
A4. Assumptions 14
References 15

3. 2
About TIAA-CREF & Executive Summary
TIAA-CREF: FINANCIAL SERVICES FOR THE GREATER GOOD
Since our founding in 1918, we have been helping millions of people plan for retirement. Our clear and long-term
commitment to serve those who dedicate themselves to the benefit and enlightenment of others remains
unchanged.
Specializing in the distinctive needs of those who work in the academic, research, medical, and cultural fields;
TIAA-CREF has subscribed to a different set of guiding principles, directly influenced by the people we serve. We
focus on the best interest of our participants. For nearly 100 years, we have continued to stay true to our
purpose—a commitment to serve those who serve others. TIAA-CREF can help you reach your financial goals—for
retirement, saving for college or providing protection for your family. We harmonize your personal needs with the
products and services we offer.
Executive Summary
MR & MRS. SMITH
We take this wonderful opportunity to congratulate you for reaching this period in your life and commend taking
the steps to prepare for retirement.
We understand that life rarely goes as planned and the transition into retirement requires larger than normal
sacrifices and changes from a life that you may have been accustomed; thus our team makes it our goal to
effectively prepare individuals and couples like yourself for these (golden years) that you have looked forward to
all of your life. We are aware that many people view retirement as a period of freedom of time, some the ability to
do the things that have been put off for one reason or the other and for others the ability to spend time with loved
ones.
For whatever your reason, our team believes in skilled preparation. Understanding that preparing for retirement
can be challenging and time consuming, we immerse ourselves in understanding the industry and applying the
appropriate recommendations that we feel will best suit our clients.
Specifically to meet your needs, you will see in this report an outline of the clear steps you should take towards
retirement and plans to make your transition a smooth one. Our recommendations includes the proper asset
allocation of investments, developing annuity portfolios and accounts, offloading unnecessary debt and proper
downsizing of expenses from large assets such as your house and smart spending on necessities on an annual
basis. While we want to ensure the accuracy and relevance of our information, we took the liberty to analyze your
current financial position against the current market and as a prudent financial advisor should, we took into
consideration your goals so that your retirement would be comfortable.
This plan was created for maximum results through ensuring lasting income throughout your retirement, while
mitigating as much risks as possible to help you live a longer, healthier, stress-free life with the ability to meet your
goals and do those things you enjoy.

4. 3
Steps Toward Achieving Your Retirement
Step 1: Define Your Cost of Retirement
The first step as you begin to plan for retirement is to define your cost of
retirement. Your cost of retirement can be affected by many factors,
including:
 Your retirement age
This is the age at which you plan to stop working
full time and start accessing your retirement
portfolio assets.
 Your life expectancy
Life expectancy will outline how many years to
plan for in retirement.
 Your monthly retirement living expenses
Are normally between 70% and 100% of your
annual earned income prior to retirement, but can
vary with individual goals.
Step 2: Apply Your Income Sources
Once you have determined your cost of retirement we will look at the income sources that will be available to you
in retirement to help meet these costs. Income sources include but are not limited to:
 Social Security
 Pensions
 Immediate annuity payments
Step 3: Determine Portfolio Withdrawal Requirements
Once your existing income sources have been applied to your costs of retirement, you can take withdrawals against
your portfolio assets to make up the difference. Portfolio assets include:
 Brokerage accounts
 Money Market Accounts
 401(k)s, 403(b)s, and other employer-sponsored retirement accounts
 IRAs (Traditional & Roth)
 After-tax Annuities
Step 4: Identify Planning Gaps & Making Changes
If it is determined that you are not on path to achieve your retirement objectives, changes will be needed. These
changes may include:
 Portfolio re-balancing and investment recommendations
 Save more
 Redefine retirement age
 Consider part time employment during retirement
 Reduce retirement spending

5. 4
Mr. & Mrs. Smith’s Current Position
Your annual financial current position is shown below: (to see report in their entirety refer to the Appendices A2).
Income
Salaries $170,000
Annuity $22,000
Total Annual Income $192,000
Expenses ($62,364)
Taxes ($47,600)
Surplus $82,036
Savings $54,000
Total Surplus $136,036
*Expenses include your home, food, transportation, and other miscellaneous expenditures.
**Salaries exclude taxes
*Assets include bank accounts, equity, automotive, and real estate.
*Liabilities include real estate and credit debt.
Currently, your available income sources for retirement are:
Sources Liquidity Favorable Tips
Social Security
$74,000
Look into File &
Suspend on SS website
Mr. Smith’s 401(k)
$200,000
Use as residual monthly
income
Mrs. Smith’s
Annual Annuity $22,000
Kick-start IRA with this
annual amount
Pensions - Every day income
Our team is delighted that you have come to us for financial assistance. We hope that you both will trust that our team
is here to make your future more affordable and financially longer lasting. Our team has shown you what your
retirement looks like today; however, you want to retire at age 65 and it will be our pleasure to show you throughout
the remainder of the report that the longer you wait to retire the better. We will provide you with recommendations
that will best fit your personal needs and set you up for the rest of your lives.
Assets
$926,571
Liabilities
$197,500
Net Worth $729,071
You are in a great place, you have
$82,000 surplus each year and the
key to this plan will be to use these
dollars to plan for a secure
retirement.
Combined Needed Income:
$112,073
Combined Needed Income
(including S.S.):
$38,018
Savings Needed:
$664,621
You have more assets than liabilities! In
total your net worth is in good shape, at
$729,000! However it is our job to help
make it great.

6. 5
Current Market Analysis
Mr. and Mrs. Smith, you are going to enter into retirement soon. A number of risks will affect how your life will be
funded for the next 25-30 years. This section focuses on your personal state of the union, providing insight into what
the market, and your decisions thus far have prepared for your future in retirement.
Social Security and You
The future of social security is unknown; however, it would be in your best
interest to be prepared for all ends of the spectrum. The best way to
understand the current state of your social security is to start getting interactive:
Visit & start exploring tools to help calculate benefits
and other helpful interactions to be able to begin planning on behalf of your
benefits!
A few quick things to note about the changes that can ensue during your Social
Security journey:
 Your earnings may increase or decrease in the future
 After you start receiving benefits, they will be adjusted for cost-of-living increases & the benefits are
structured to take on inflation
 Your estimated benefits are based on current law. The law governing benefit amounts may change because,
by 2033, the payroll taxes collected will be enough to pay only about 77 cents for each dollar of scheduled
benefits
Let’s take a look at your current position within social security:
Social Security Annual Income
- Mr.
The graph to the left shows estimates both of your overall
benefits if you retire at age 65 and then age 70 with a life
expectancy of 95 years old by retiring at 65 you would be
decreasing your lifetime benefits 17%
Source: CNN Money Retirement Calculator - We recommend that you take the
time to visit the Social Security website and try other calculators.
Mr. Smith Mrs. Smith
Total SS
age 95
~ $27,234 ~ $25,512 ~ $1, 582,380
~ $35,538 ~ $35,538 ~ $1,850,000
Retirement
65
70
Mrs. Smith,
765,360
Mrs. Smith,
888,450
Mr.Smith,
817,020
Mr.Smith,
962,925
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
65 retirement 70 retirement
$Accumalation
Retirement Accumalation at age 95
17%

7. 6
Investments, Investments, and More Investments
The Good News is your Above Average:
 90% of working-age households in the U.S. are not saving enough for retirement
 45% have nothing saved
 $12,000 is the median retirement savings of households nearing retirement
Investments are going to make your lifestyle sustainable, and that is why it is important
to understand the basics of the current state of the bond market as well as the stock
market.
It is a typical rule of investment thumb that when stocks are up, bonds are down and in
terms of asset allocation it is the simplest answer to say at this age your portfolio should
roughly be a mix of bonds with 60% and stocks 40%. However we believe in the situation
of the current market that your assets should be invested in a ROTH IRA, and
RETIREMENT INCOME VARIABLE ANNUIT Y FUNDS! Our goal is to make sure you are
taking enough portfolio risk to make substantial income but safe enough to sustain in harder market times.
Currently bond yields are LOW while stock market return is HIGH.
Putting the Current Market in Perspective:
Bond Market as of 07/19/2013 Stock Market as of 07/19/2013
Mutual Funds Reflect Current Market
Source: CNN Money, real-time data reflected
The bond market represented is U.S. Treasury and
Corporate Bonds respectively while fund categories & stock
markets are offered by industry. Bottom line: Bond yields
are declining while the stock market returns are inclining
Diversifying is a safe way
to be more risky – By
investing in FUNDS
rather than individual
stock you are providing a
safety net…
optimistically everything
won’t decline.
Bottom Line: TIAA-CREF offers
a variety of funds that will make
it possible to provide more
monthly income but also have
the longevity you need to
sustain your lifestyle

8. 7
• Get this: A portfolio that is 80% invested in stocks and 20% in bonds in this market with a 4% withdrawal
rate has only a 14% probability of running out of money. This is because the higher expected returns for
stocks. If they only have a 3% withdrawal rate the probability goes down to 4%
• Get this: A typical 65-year-old couple with $1 million in tax-free municipal BONDS want to retire. They
plan to withdraw 4% of their savings a year. But in this market if they spend that $40,000 a year, adjusted
for inflation, there is a 72% probability they will run out of that money before they die
Living in Dallas, Texas for Retirement
“This is definitely a seller’s market,”- Jeff Duffey, of Jeff Duffey & Associates, in Dallas, TX.
Currently in Dallas Texas it is a perfect time to SELL and it just may be the place to BUY. During the huge
residential housing boom between 2000 & 2006, places like L.A. saw triple-digit gains in home prices while Dallas
home prices only rose a measly 24% in total. But now the single family home inventory is just 2.8 months,
meaning every available house would be sold in theory in 2.8 months when just 20 years ago it was 10.3 months
and 10 years ago in the middle of the “boom” it was 6.7 months.
Healthcare Costs Will Include Out-of-Pocket Costs
As healthy individuals the expectations for healthcare costs are increasing. Out of pocket costs are of the greatest
concern because this directly affects your income. The chart below shows both of your out-of- pocket healthcare
costs for the both of you if you were to retire now, at the age of 65 and then 70. This is shown given the current
market for life expectancies of 75, 80, 85, 90, and 95.
Source: Society of Actuaries, Healthcare Costs from Birth to Death, June 2013
246,800
101,800
46,000
353,000
182,400
107,400
498,600
292,800
191,000
694,400
441,200
303,600
953,600
637,600
452,400
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
60 65 70
HealthCareCosts
Retirement Age
Healthcare Costs for 2 by Retirement Age and Life Expectancy
75 80 85 90 95
Life Expectancy
Note: This graph
shows that if you
were to retire at
age 65 out-of
pocket costs until
age 90 would be
$637,600 versus
$452,400 retiring
at age 70

9. 8
Bottom Line: Medicare can couple with your
employer benefits to provide you with a
strong healthcare plan. APPLY at 65 regardless
of your working status to make sure you will
have the benefits you need when you do plan
to retire.
Medicare?
Medicare is our country's health insurance program for
people age 65 or older. The program helps with the cost of health
care, but it does not cover all medical expenses or the cost of most
long-term care, the types offered:
Hospital insurance (Part A) helps pay for inpatient care in a
hospital or skilled nursing facility (following a hospital stay), some home health care and hospice care.
Note: Most people age 65 or older are eligible for free Medicare Hospital Insurance (Part A) if they have worked
and paid Medicare taxes long enough. You should sign up for Medicare Hospital Insurance (Part A) 3 months before
your 65th birthday, whether or not you want to begin receiving retirement benefits.
Medical insurance (Part B) helps pay for doctors’ services and many other medical services and supplies that are
not covered by hospital insurance.
Note: Anyone who is eligible for free Medicare hospital insurance (Part A) can enroll in Medicare medical
insurance (Part B) by paying a monthly premium. Some beneficiaries with higher incomes will pay a higher
monthly Part B premium.
Anticipating Risk is the Back-bone of Retirement
Inflation
It is inevitable that your $dollars today will not be worth the same as your $dollars in 20+
years. Luckily, a lot of your income will somewhat adjust to inflation; the best way to fight
that risk is to make sure that your money is consistently growing to offset any losses
Longevity
Making sure your money withstands your lifetime is not an easy task especially coupled
with the various expenditures that come throughout retirement. The best way to soften this
risk is to stick to our plans, if you invest, save, and live as we suggest you will not have
the short-comings of outliving your money
Health
You will never be able to completely plan your health risks but there are ways to be
prepared. Planning for the unknown may seem difficult but we are here to help. Above you
noticed, health is not cheap therefore a combination of insurance and a nice cushion for
out-of-pocket costs are needed. Our first step is making sure you have the proper finances
for that cushion.
Variable Costs
It is possible that everything could drastically change in the near future or beyond, but
making sure that you are equipped with the proper insurance, and providing a net of
savings and diversified investments to catch cumbersome expenses will keep you from
feeling the ding of the out of pocket costs.

10. 9
Mr. & Mrs. Smith’s Current Position Report
Our team has developed a monthly cash flow and a statement of net worth for the current year based on the
information given to us by Mrs. Jones. Currently, your salaries combined are a total of $170,000 annually
excluding taxes. When considering taxes and Mrs. Smith’s annuity ($22,000 annually), your current cash available
is $144,400 annually. Next calculating your expenses, which include home, food, transportation, and
miscellaneous your total cash paid out is $62,364.41. After subtracting your cash paid put from your cash
available, your cash flow is $82,035.59.
When looking at your statement of net worth, your total assets amount to $926,570.90 which includes bank
accounts, equity, automotive, and real estate. Your total liabilities amount to $197,500 which includes real estate
and credit debt. After subtracting your liabilities from your assets, your current total net worth combined for 2013
is $729,070.90.
Currently, your income for retirement consist of Social Security for both Mr. & Mrs. Smith (benefits depend on how
long you wait to claim), Mr. Smith’s 401(k) plan, Mrs. Smith’s $22,000 annual annuity, Mr. Smith’s $400,000 term
life coverage, Mrs. Smith’s $400,000 term life coverage, equity, and fixed income. Hypothetically, your fixed cost
income combined, totals $1, 460,000. This amount does not include your income for Social Security, Mr. Smith’s
401(k) plan, or your taxable investments since they are variable costs.
Based on your current age (60), desired retirement age (70), life expectancy (95), and your current income
($90,000/$80,000), your expected Social Security benefits are $38,517 for Mr. Smith and $35,538 for Mrs. Smith.
In retirement, Mr. & Mrs. Smith will need $112,073 a year in income. (Because of inflation, in 2023, that will be
equivalent to $150,617). Part of that income will come from your Social Security and pensions. To produce the rest
($38,018), you and your spouse should build your nest egg (including 403(b), IRA and other investment/saving
vehicles) to $664,621 by the time you retire. (In 2023, that will be equivalent to $893,165).
To save $664,621, your investments need to gain an average of 16.14% from now until retirement. If you and your
spouse do not invest in any other vehicles you have a 0% chance of saving $664,621 by the time you retire, a 10%
chance of saving $335,961, a 50% chance of saving $279,353, and a 90% chance of saving $231,478.
Mr. Smith Mrs. Smith
Pre-retirement Income $90,000 $80,000
Social Security Income $38,517 $35,538
Combined Needed Income $112,073
Combined Needed Income (including S.S.) $38,018
Savings Needed come Retirement $664,621
*Figures are based annually
**Mrs. Smith’s annual annuity is not factored into this retirement plan
Source: CNNMoney.com

11. 10
Retirement Recommendations
Retirement is just another phase of your life and we want you to be able to enjoy every part of it. We believe in
effective planning to assist you in meeting your retirement goals in a stress-free atmosphere removing any
possible challenges and setbacks.
Based on our analysis of your current financial position from the information that we have received, we have
prepared a Statement of Monthly Cash Flow and Statement of Net Worth. From analyzing these reports, we have
developed a plan that would assist you in your preparation for retirement, transition into retirement and cover
post retirement challenges. We have also taken into consideration your goals of maintain your lifestyles of annual
vacations and replacement of new vehicles in 10 year intervals.
Our plan consists of various steps that you should take to prepare for retirement. We ask that you review each step
the plan of recommendations below in its entirety and consider these for a smooth transition into retirement and
for longevity of the assets for your enjoyment.
Step 1: Initial Retirement Plans
Engage Financial Advisor
 Using professionals to manage your assets for effective
planning, growth & sustainability and most importantly asset
protection is easier than you would imagine. It is our job to
ensure that you reach all of your goals, mitigate risks from
the market and manage your personal finances for the best
results, and to even provide effective succession planning for
the safe passing of assets to a surviving family including but
not limited to spouse, children and grandchildren.
Set Your Retirement Age
 We recommend that you both retire at or closest to age 70.
We believe that there is still more preparation that can be
done to increase your annual retirement income. The amount of your income depends on when you retire,
the social security benefits and tax laws which affect distributions from annuities.
Define Retirement Cost
 Outlining accurately your monthly expenses allows effective planning for retirement. Being that you are in
good health, we anticipate that your retirement will last anywhere from 25 – 30 years.
Step 2: Reduction of Expenses and Asset Adjustments
From our analysis, we have found that your largest expense is your home. It is our recommendation that you
should, within the next 3 years SELL your home in an effort to ELIMINATE the mortgage and DECREASE taxes and
home-owners insurance.
 As it is currently assessed, having a value of $550,000, it is our view that
selling the house will allow room for you to be able to pay-off the existing
mortgage, purchase a new smaller and more manageable home DEBT-FREE
and allow the freeing of approximately $30,000 per annum (Additional cash
flow that can be invested into a Money Market Fund holding conservative
mutual funds).
 Pay off and eliminate any credit cards debt, personal loans or any other credit
facility charging interest fees.
 Consider smart spending options through fulfilling your goals by
I. When purchasing your car in 10 year intervals, consider two late-
modeled used cars or as this will be your retirement you can
consolidate costs by purchasing one new car for use.
II. When considering travel, as you would be in retirement, you would have additional free time on your hands.
Consider traveling by rental car, bus or train to avoid high airplane prices when the option is available. Larger
more extravagant trips to exotic countries and historical cities can be done every other year.

12. 11
Step 3: Effective Saving for Maximizing Retirement Income Sources
We have found that when a couple worlds together towards one common goal, the individual efforts pay off.
Based on your current financial status, there is a present surplus of $82,065. Below we will outline our
recommendations on how that can be effectively saved and maximize your retirement income through Power
Saving of the excess $82,065 surplus:
Mr. Smith Mrs. Smith Joint Annuity
Having an existing 401(k) account with
a current balance of $200,000 is a good
position but when monthly payments
are amortized, it is simply not enough.
We recommend that you engage in
“Cashing-Up” by injecting $23,000 per
annum until retirement takes effect.
Over a 10 year period this will yield a
total of $230,000 and increase the
monthly cash payout from this
retirement annuity.
Having no retirement accounts places
you in a precarious position. We
strongly suggest that you engage in an
individual 403(b) and fund it with the
maximum of $23,000 per annum. This
will be your “Cashing-Up” and will
result in $230,000 over a 10 year
period.
Having additional funds, we suggest you
open a 403(b) account injecting an
annual $23,000 per annum to be
additional savings for retirement and
for the proper “socking-away” of
enough cash for use during retirement.
 We recommend that you place your stocks into a Variable Annuity Fund for safe keeping and tax
benefits. We anticipate that in your field of work and level of positions, sizable
bonuses would be received on an annual basis and would further recommend
that additional stocks be purchased and inject into the Variable Annuity Fund.
 We also recommend you invest in some of our products:
o TIAA-CREF Portfolio Advisor Program & Private Asset Management
o TIAA-CREF IRA
o TIAA-CREF After Tax Annuity
o TIAA-CREF Brokerage Services
 Maintaining a basic savings & checking account with a balance of
$50,000 is recommended to cover daily and monthly trivial to emergency
expenses, opportunities and protection. Any additional funds should be
“socked-away” into the Variable Annuity Fund for additional and
expanded investing opportunities.
Retirement Employment
 Choosing to work throughout your retirement is another excellent way to
make extra money or to assist in maintaining your preretirement lifestyles. Being in good health, this can
also help you to remain active and engage your talents and skills that you have used for years. We believe
and recommend that you do engage in post-retirement employment.
Post-Retirement Employment Options
Mr. Smith
-Asset Manager
-Financial Consultant
-Banking Policy & Procedure Consultant
-Board of Director or Trustee
Mrs. Smith
-Tutor
-Substitute Teacher
-School Office Secretary
-Walmart Greeter
-Librarian
Social Security
 Social Security is primarily based on how long you have worked and your salary history. The longer you
have worked for an employer who pays Social Security, the larger your salary over the years and the more
benefits you’ll receive. We want you to get the best benefit from Social Security by not filing for it before the
appropriate time (at 70). We note that you both are in good health which places you in the best position to
file for Social Security later and get the best benefit.

13. 12
Appendices
Popular Tax Deferred Investment Vehicles
Do you want to pay taxes now if you don’t have to? The answer to this question is, no. Tax deferred vehicles allow
you to make investments today and defer paying taxes on investment growth until the funds are withdrawn. This
allows for many years of potential investment growth because it will be years before you need to tap into these
funds. Contributions made on either a pre-tax or tax deferred, your balance will increase more quickly than if you
had placed your money in a taxable vehicle. The following table and chart is an example of how tax-deferred
growth pans out versus taxable growth for a person saving $9,000 per year over 30 years*:
10 Years 20 Years 30 Years
Taxable Balance $128,434 $366,708 $808,758
Tax Deferred Balance $144,865 $472,402 $1,212,957
Difference $16,431 $105,694 $404,198
Tax Deferred Balance
After Taxes
$131,149 $399,301 $977,218
*Assumes 8.5% Rate of Return, 25% federal tax rate on the growth
of the asset. The tax-deferred values exclude the 10% penalty that would
potentially be assessed if the values were withdrawn prior to age 59 ½.
There are many tax-deferred investment vehicles available for
you both. The table below lists some of the popular investments:
401(k) Accounts
&
403(b) Accounts
401(k): A defined contribution plan offered by a corporation to its employees affording three
main advantages. First, contributions come out of your pocket before taxes, lowering your taxable
income. Second, tax deferred growth and third, the potential for an employer match on your
contribution. All withdrawals are subject to ordinary income taxes and may be subject to a 10%
federal tax penalty if taken prior to 59 ½.
403(b): Also a defined contribution plan but made available to employees of educational
institutions and certain non-profit organizations. Contributions and investment earnings in a
403(b) grow tax deferred until withdrawal, at which time they are taxed as ordinary income. All
withdrawals are subject to ordinary income taxes and may be subject to a 10% federal tax penalty
if taken prior to 59 ½. Both a 401(k) and 403(b) have a maximum annual contribution in 2013 of
$17,500, and individuals over age 50 can contribute an additional ‘catch-up’ contribution of
$5,500.
Traditional Individual
Retirement Account
(IRA)
A Traditional IRAs is a retirement investing tool for employed individuals and their non-working
spouses that allow annual contributions up to a specified maximum amount. Tax deductions may
be allowed on the contribution amount depending upon the individual’s income and whether or
not they participate in an employer-sponsored retirement plan. A 10% federal tax penalty if taken
before age 59 ½.
Roth IRA
Similar to a Traditional IRA, a Roth IRA allows individuals to contribute up to a specified maximum
amount. Unlike a Traditional IRA, a Roth IRA cannot accept contributions if the owner has
adjusted gross income over a certain amount. All contributions made to a Roth IRA are done on an
after tax basis. However, if plan requirements are met, withdrawals of earnings are tax-free.
After-tax Annuities
An annuity is a contract, offered by an insurance company, between an investor the holder and an
insurance company, designed to provide payments to the holder at specific intervals, usually after
retirement. Annuities are tax-deferred, meaning that the earnings grow tax-deferred until
withdrawal. Money distributed for the annuity will be taxed as ordinary income in the year the
money is received. Money withdrawn prior to 59 ½ may be subject to a 10% federal tax penalty.
Annuities provide no additional tax advantages when used to fund a qualified plan.
$0
$500,000
$1,000,000
$1,500,000
10 20 30
Taxable Tax-Deferred

14. 13
Current Position
Salaries Jan Feb March April May June July Aug Sep Oct Nov Dec TOTAL
Mr. Smith $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $90,000
Mrs. Smith $6,667 $6,667 $6,667 $6,667 $6,667 $6,667 $6,667 $6,667 $6,667 $6,667 $6,667 $6,667 $80,000
Net Salaries $14,167 $14,167 $14,167 $14,167 $14,167 $14,167 $14,167 $14,167 $14,167 $14,167 $14,167 $14,167 $170,000
After Tax Income $10,200 $10,200 $10,200 $10,200 $10,200 $10,200 $10,200 $10,200 $10,200 $10,200 $10,200 $10,200 $122,400
Mrs. Smith's Annuity $1,833 $1,833 $1,833 $1,833 $1,833 $1,833 $1,833 $1,833 $1,833 $1,833 $1,833 $1,833 $22,000
Total Cash Available $12,033 $12,033 $12,033 $12,033 $12,033 $12,033 $12,033 $12,033 $12,033 $12,033 $12,033 $12,033 $144,400
Cash Paid Out
Home
Mortage (interest 3.75%) $1,352 $1,352 $1,352 $1,352 $1,352 $1,352 $1,352 $1,352 $1,352 $1,352 $1,352 $1,352 $16,220
Property Taxes/Insurance $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $18,000
Utilities $205 $205 $205 $205 $205 $250 $250 $250 $250 $205 $205 $205 $2,640
TV, Internet, & Voice $63 $63 $63 $63 $63 $63 $63 $63 $63 $63 $63 $63 $756
Food
Groceries $450 $450 $450 $450 $450 $450 $450 $450 $450 $450 $450 $450 $5,400
Dining Out $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $2,400
Transportation
Car Payment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Gas (combined) $312 $312 $312 $312 $312 $312 $312 $312 $312 $312 $312 $312 $3,749
Car Insurance (combined) $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $4,200
Misc.
Entertainment $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $3,000
Shopping $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $6,000
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cash Paid Out $5,182 $5,182 $5,182 $5,182 $5,182 $5,227 $5,227 $5,227 $5,227 $5,182 $5,182 $5,182 $62,364
Cash Flow (Avail.-Paid) $6,851 $6,851 $6,851 $6,851 $6,851 $6,806 $6,806 $6,806 $6,806 $6,851 $6,851 $6,851 $82,036
Mr. & Mrs. Smith's 2013 Household Cash Flows
Bank Accounts 54,000.00$
Stocks
IBM 20,790.00$
AT&T 5,040.00
Marriott 3,968.75
Microsoft 4,815.00
Marathon Oil * 2,957.15 37,570.90
401 (K) Plan 200,000.00
Cars
Mr. Smith (Lexus GS) 45,000.00$
Mrs. Smith (Lexus ES) 40,000.00 85,000.00
Real Estate
Home 550,000.00
Smith's Total Assets 926,570.90$
Real Estate
Mortgage 190,000.00$
Credit Cards
Mr. Smith AmEx 4,000.00$
Mrs. Smith AmEx 3,500.00 7,500.00
Smith's Total Liabilities 197,500.00$
Smith's Net Worth 729,070.90$
ASSETS
LIABILITIES
Statement of Net Worth
Mr. & Mrs. Smith
Statement of Net Worth/Balance Sheet
For the year ended December 31, 2012

15. 14
Assumptions
Item/Category Assumption Reason
Retire at 70
Because there are in good health
and reasonable strength, retiring
at 70 would be a piece of cake.
In an effort to ensure their comfort throughout their
retirement years, retiring at 70 would take them to the
max. in social security payments that would be
received. This would assist in their ability to maintain
the lifestyle that they were accustomed to having.
Financial Advisor
Mr. & Mrs. Smith are not in a bad
financial position at all. Engaging
a financial advisor would assist in
the protection of their assets for
longevity and for succession to
surviving family.
Our retirees seemed to be very successful and well
rounded; their children wouldn't be far from the mark
either. Having families of their own, the succession
plan of our retirees can extend to their children and
even grandchildren in years to come.
Mrs. Smith Annuity
Her annuity of $22,000.00 p/a
will continue through until death.
Understanding that it was a "life" benefit, we can
assume this would carry on and be to her benefit and
use.
Health Insurance
Mr. and Mrs. Smith
Retired with full Health
Insurance coverage.
Industry standard in the Banking profession affords
staff full coverage medical, health, vision, and dental
insurance and it is extended to the spouse and
dependents. Industry standard also dictates that once
an employee retires from the institution, these benefits
go with them to death. We safely assumed that this is
the case for our retirees.
Home-Owners
Insurance
The smaller the house, the least
expensive home-owners
insurance will be.
From the value of the home in the state of Texas we can
assume that this is a large estate. Downsizing will not
only decrease or eliminate the mortgage but it will put
the retirees in a more manageable position during their
retirement.
Vehicles
Mr. Smith has a Lexus GS350 and
Mrs. Smith has a Lexus ES350.
Being at this stage in their lives, our retirees need
comfort, reliability, and a touch of luxury. We assume
that being the level headed conservative consumers
that they are, these vehicles matched their lifestyles.
Credit-Card
Mr. and Mrs. Smith both had
independent American Express
credit card accounts.
Industry standard and in keeping up with the time and
technology, or retirees would have credit cards.
Looking at their conservative lifestyle, we safely
assumed that they would have normal balances from
normal usage.
House-Hold
Expenses
Using industry standard and
looking closely at their lifestyle,
we assumed that they would
enjoy what the average American
enjoys in their home.
As individuals reach their golden ages comfort and
stability becomes a necessity. Our retirees are of no
exception to this law and we wanted to
comprehensively paint a snap-shot of our clients in an
effort to better meet their retirement needs.
Marathon Oil Stock
Value
Used stock price of $34.79. At the time the financials were prepared (June 21,
2013), the NYSE trading value was $34.79. We saw it
fitting to give present market value for an accurate
calculation of their Net Worth.
Taxes
As Dallas, TX residents we
calculated after-tax income is a
product of net salaries les income
taxes which only calculate federal
taxes.
Mr. & Mrs. Smith are Dallas, TX residents and Texas
does not have state income tax.

16. 15
For More Reference
Reports
FSD Financial Services Inc, Immediate Annuity Experts Examples
<http://www.immediateannuityexperts.com/Immediate_Annuity_percentage.htm>
Society of Actuaries, Health Care Costs – From Birth to Death June 2013
<http://www.soa.org/Research/Research-Projects/Health/research-health-care-birth-death.aspx>
TIAA CREF Life Goals Series: Achieving Your Financial Goals
<http://www1.tiaa-cref.org/ucm/groups/content/@ap_ucm_p_tcp/documents/document/tiaa04016242.pdf>
Texas A&M University Real Estate Center 2012 Market Report Dallas-Fort Worth- Arlington
<http://recenter.tamu.edu/mreports/2012/DallasFWArl.pdf>
Articles
Guinto, Joseph “The Hottest Dallas Housing Market Ever” June 25, 2013; The D Magazine
<http://www.dmagazine.com/Home/D_Magazine/2013/July/The_Hottest_Dallas_Housing_Market_Ever_01.aspx>
Klein, Matthew “Are Americans Saving Too Much or Too Little?”, June 11, 2013; Bloomberg
<http://www.bloomberg.com/news/2013-06-11/are-americans-saving-too-much-or-too-little-.html>
State Taxes - Texas
<http://www.bankrate.com/finance/taxes/state-taxes-texas.aspx>
Tools
CNN Money Market Overview
<http://money.cnn.com/data/markets/>
CNN Money, Retirement Planner
<http://cgi.money.cnn.com/tools/retirementplanner/retirementplanner.jsp>
Social Security Administration, Retirement
<http://www.ssa.gov/pgm/retirement.htm>
TIAA CREF Financial Services
<www.tiaa-cref.org>