Retirement- 9 steps to comfort and security

Retirement 9 steps to financial comfort & security

9 Steps to Financial Comfort & Security “How can I be sure I won’t outlive my money?”

Over the last decade, I’ve had the privilege of meeting with thousands of hardworking people who were seeking help with their financial matters. I noticed an interesting trend. Regardless of the size of a client’s bank account, they share a common fear: “How can I be sure that I DON’T outlive my money.” Nobody wants to run out of money during retirement and be forced to be a burden on their family or friends.

These 9 steps will give you budgeting tools and useful financial planning ideas to help prepare you for your golden years. If you feel you could use additional help planning for your golden years, please contact my office. I would be happy to sit down with you, discuss your situation, and put together a plan to help you enjoy a comfortable retirement Sincerely,

#1 Know where you are .................................................... 1 #2 Reduce Debt and Expenses ...................................... 3 #3 Increase Income ............................................................ 3 #4 Diversify-Diversify-Diversify ...................................... 4 #5 Understand and Maximize Social Security .......... 5 #6 Insure for the unexpected ......................................... 6 #7 Consolidate your Accounts .....................................15 #8 Plan for Emergencies ................................................18

Mike Nielson, CFP

#9 Create an Estate Plan .................................................20

Step #1: Know where you are.

Imagine you’re driving over to visit a friend who just moved into a new house. No matter how hard you try, you can’t find the house. You finally decide to call and inform them that you are lost and need help. The first question they will probably ask is: “Where are you?”

That’s the same question you need to answer regarding your own finances before you can properly plan for retirement. Where does your monthly income come from? How is it spent? Where are you investments held? How much debt do you really owe?

This exercise will help you better understand your current income/spending habits and your overall financial situation. Please take 30 minutes to complete the following worksheets.

Income

Net Monthly Income:

Include all sources: wages, salary, commissions, pension, social security, and other income. Enter your net monthly income; the amount you take home after taxes are deducted.

$________

Clothing & Dry Cleaning Entertainment (movies/vacations) Pet Supplies & Services Personal Products

$________ $________ $________ $________

Credit Card Payments Credit Card Monthly Payment #1 Credit Card Monthly Payment #2 Credit Card Monthly Payment #3

$________ $________ $________

Charitable Contributions

Gifts $________

Donations $________

Other Expenses Other__________________ Other__________________ Other__________________ Other__________________ Other__________________ Other__________________

Expenses

Household Expenses

Mortgage/Rent Payments $________

Taxes $________

Medical/Health $________

Insurance Premiums (life, LTC. other) $________

Tuition & Childcare $________

Homeowner’s Insurance $________

Telephone Services $________

Cable Internet $________

Gas/Water/Electric $________

Transportation (car/commuting) $________

Services (house cleaning/lawn) $________

Groceries $________

Restaurants $________

Total Monthly Expenses: $________

Add all your monthly expenses and enter the answer here.

(B) Total Annual Expenses: ( x 12) $________ Multiply your Monthly Expenses by 12 and enter the answer here.

(A) Total Annual Income: ( x 12) $________

Multiply your Net Monthly Income by 12 and enter the answer here.

$________ $________ $________ $________ $________ $________

Dollars Available to Invest, Save or Spend

Total Annual Income (A) Total Annual Expenses (B)

$________ - $________

Total Dollars Available

= $________

Were you surprised by any item?

Pleased? Frightened?

Do you need to change any spending habits?

Assets & Income

Step #2: Reduce debt & expenses.

Current Value

Primary Residence $________

Vacation Home/Rental Property $________

Automobiles - blue book value $________

Trucks, Boats, other transportation $________

Savings Accounts $________

Checking Accounts $________

College Savings Accounts $________

Individual Stocks $________

Individual Bonds $________

Variable Annuities $________

401k/403b $________

IRAs $________

Fixed/Immediate Annuities $________

Mutual Funds $________

Money Market Accounts $________

Certificates of Deposit $________

Pension $________

Veteran’s Benefits $________ Other Assets__________________ Other Assets__________________ $________

If you want to feel more comfortable about your retirement years, you’ll need to exercise discipline over your spending habits. Reflect on the assets and liabilities worksheet in Step #1. Are you where you thought you would be or want to be? If not, you need to make changes to your spending habits and reduce your debt.

Reducing expenses Were you surprised by the dollar amount and number of monthly expenses in Step #1? You work hard for your money, so make sure you know where it’s going and that you’re getting something of value from those expenses.

Ask yourself, “can I live without something that’s costing me $100/month? Can I find a similar item or service at a lower cost? Look for at least two items to cut out or reduce from your monthly expenses.

Taking control of your money will give you a feeling of empowerment and will help you on the path towards retirement, or help you remain retired. Saving $50 here and $100 there adds up over time. Saving an extra $300/ month for 10 years equals $36,000, which isn’t chump change.

Reducing debt There is good debt and there is bad debt. Good debt is usually debt that allows you to purchase an asset that will appreciate in value over time, like student loans for college or a home mortgage. Bad debt is usually debt you accumulate by purchasing something that will depreciate in value.

(A) Total Assets: $________

Add your assets. Enter the answer here.

Liabilities

Current Debt

Balance on Home Mortgage Tuition Loans Credit Card Balances Home Equity Loans Medical Expenses Car Loans Other Debt ________________ Other Debt ________________ Other Debt ________________ Other Debt ________________

$________ $________ $________ $________ $________ $________ $________ $________ $________ $________

(B) Total Liabilities:

$________

Add your debts. Enter the answer here.

Total Net Worth

Total Assets (A) Total Liabilities (B)

$________ - $________

Total Net Worth

= $________

“If you think nobody cares if you’re alive, try missing a couple of car payments.” Earl Wilson

Credit card debt

The average interest rate on personal credit cards is over 13.75%.1 That’s a lot of interest to pay when money at the bank is only earning 1– 2%. Consider these statistics: • The average credit card holder carries a balance of around $5,437. 1

Are you happy with these numbers?

If you think there’s room for improvement, set an appointment to talk with me about reducing debt or making your investments work harder for you.

303.290.8600

*Additional copies of these worksheets are available online: www.nielsonwealth.com

• Nearly ¾ of American families report having a general-purpose credit card.1 If you are in the habit of paying off your credit card bills each month, keep up the good work. If not, I would advise you to make the spending changes necessary for you to pay down/off your credit card debt.

Home Mortgages

For most people, owning their home is a good decision. You can benefit from ownership and build up equity over time. When possible, work to pay off your mortgage before you retire. If you currently have a home mortgage, consider doing one of the following: 1. Refinancing to a lower interest 15 year mortgage. Your monthly payments will be higher versus the popular 30 year mortgage, but this may help you pay off your home quicker.

2. Keep your current mortgage as-is and add a couple extra hundred dollars to your monthly payment.

(See chart on next page) 3. Combine 1 & 2 together to pay off your mortgage even quicker.

1

US Census Bureau, Statistical Abstract of the United States, 2012

Step #3: Increase income.

Check out the difference between a 15 and 30 year mortgage

Mortgage Payoff Summary

Loan Amount

Loan Term

Interest Rate 30 yr monthly payment (blue line)

Interest paid

Loan Term

Interest Rate 15 yr monthly payment (red line)

Interest paid

$250,000 30 years 4.5% $1266.71 $206,016 15 years 4.0% $1849.22 $82,859

Look for ways to increase and maximize your income.

A safe and sustainable withdrawal rate during retirement varies based on age but is usually between 5%-8%.

If you are still working: Evaluate your financial situation from Step #1. One of the best things you can do to prepare for retirement is to plan ahead. How much do you already have saved in retirement accounts? Will you have a work pension?

When do you plan to start Social Security?

If you took a 5% income withdrawal from your retirement accounts, is that enough to live on combined with Social Security, work pension + other income? If not, how much are you contributing to your retirement accounts each year? Consider increasing it.

How are your retirement accounts invested and how have they performed? If you don’t know, set an appointment with my office and we can review them with you. You need to make sure that your hard earned retirement savings are working hard for you.

While you’re still working, pay down or payoff your home mortgage and other debts. Make sure you maximize your Social Security benefits, discussed more in Step #5. You may want to consider delaying your retirement date by a couple of years.

Let’s do the math: A 15 year mortgage will save you $123,157 ($206,016 - $82,859) in interest.

Consider these hypothetical examples: What if you added $250 more to your monthly 30 year mortgage payment?

Mortgage Payoff Summary

Loan Amount

Retirement age 62 Retirement Accounts of $1,000,0000. Withdrawal income of 5% = $50,000 a year.

Social Security income = $18,000 a year. (25% Reduction under age 66) Work pension = $12,000 a year.

Total annual income = $80,000

$250,000

Loan Term 30 years Interest Rate 4.5% 30 yr monthly payment $1266.71 Normal Interest paid $206,016 Extra Amount $250/mo e xtra $250/mo shortens mortage 8 years

Interest Saved $65,944

What if you waited 4 years and retired at age 66?

Retirement age 66 Retirement Accounts grew 5% for 4 years =$1,215,000. Withdrawal income of 5%= $60,750 a year Social Security income increased = $24,000 a year.

Work pension increased = $16,325 a year.

Total annual income of = $101,075

What if you waited 8 years and retired at age 70?

Retirement age 70 Retirement Accounts grew 5% for 8 years =$1,477,000. Withdrawal income of 6%= $88,620 a year Social Security income increased = $31,680 a year. (32% increase over age 66) Work pension stayed the same = $16,325 a year.

Total annual income = $136,625

The Rule of 72 How many years will it take to double your money?

Divide 72 by the rate of return.

72/1% = 72 yrs 72/3% = 24 yrs 72/6% = 12 yrs 72/8% = 9 yrs

If you are currently retired: Review all of your retirement income sources: Social Security, pension, annuities, and investment accounts.

Make sure your money is invested properly and generating income. In the case of Social Security, maximized as discussed in Step #5. Look into a reverse mortgage and decide if that is an option for you.

One of the biggest enemies during retirement is INFLATION. Make sure your investments are properly allocated and invested so your income can keep up with rising living costs. A postage stamp was .29 cents in 1993 versus .46 cents in 2013.

Consider this retirement income plan called the Income Bucket Step:

With this step, you’ll allocate your money into three income buckets. Customize the income numbers in the following steps to fit your individual income situation.

Step #4: Diversify, diversify, diversify.

Diversification—a fancy investment term for “Don’t put all your eggs in one basket.”

Diversification is important. Spreading your investment risk over many different investments should help minimize the ups and downs of investing. Your retirement accounts can be spread out among Cash, Bonds, Certificates of Deposit (CD’s), Stocks, Real Estate, Mutual Funds, Gold/Silver, and Annuities, to name a few.

People have different comfort levels with risk and react to market fluctuations in a variety of ways. How you invest and allocate your retirement assets is one of the most important decisions you will make in your retirement planning. In fact, research indicates that 92% of a portfolio’s return can come from asset allocation. 2

• Step 1 Calculate how much investment income you need from your retirement accounts. Start by reviewing your monthly living expense needs from Step #1. Let’s say your monthly living expenses are $5,000. How much do you receive in Social Security? How much is your work pension? If you receive $3,500 a month between Social Security and your work pension, you’d need to generate $1,500 a month in investment income from your retirement accounts. ($3,500 + $1,500 = $5,000) • Step 2 Bucket A will hold 12 months of investment income in either a checking or savings account ($1,500 x 12 = $18,000). Or whatever your individual investment income amount is X 12 months. Use this money to help pay your monthly living expenses.

• Step 3 Bucket B will hold 48 months of investment income in bonds, CD’s, or fixed annuities. Hold $72,000 ($1,500 x 48) in this bucket, or whatever your individual investment income amount is X 48 months. Each month, transfer $1,500 into Bucket A to replenish the $1,500 which was spent on living expenses.

• Step 4 Bucket C will hold the remainder of your retirement assets. Invest them in stocks, stock mutual funds, and real estate to provide potential growth and to outpace inflation. Every 3 months, transfer $4,500 ($1,500 x 3), or whatever your individual investment income amount is X 3 months to Bucket B. This will replenish Bucket B. This step will allow the retirement assets in Bucket C to stay invested much longer and potentially earn higher returns.

Move $$ every 3 months

Move $$ every month

Bucket C Growth Assets

Bucket B

Fixed Income Assets

Move $$ every month

Which investments and allocation mix is right for you?

There are many factors to consider when choosing your investments. Together we can create a plan to suit your unique situation.

Bucket A Savings/Checking

This income bucket step can be made automatic so the “bucket replenishing” will happen automatically. That way, you won’t be thinking about transferring money each month; instead, you will be enjoying your hard earned retirement.

2 Brinson, Singer and Breebower, “Determinants of Portfolio Performance II, “Financial Analyst Journal, May/June 1991.

Step #5: Understand and maximize Social Security.

What it takes to qualify for Retirement Benefits: When you work and pay Federal Insurance Contributions Act (FICA) taxes, you earn “credits” toward Social Security (SS) retirement benefits. These credits are based on your annual earnings. You can earn up to four credits per year. Once you have acquired 40 credits (about 10 years of employment), you are fully insured and eligible to receive retirement benefits. All benefits are derived from your Primary Insurance Amount (PIA). Your PIA is calculated using your best 35 years of employment. Your PIA is the monthly benefits for which you are eligible at your Full Retirement Age (FRA).

Full Retirement Age: Year Born Full Retirement Age (FRA) 1937 or earlier 65 1938-1942

65 + 2 months for every year after 1937

1943-1954 66 1955-1959

66 + 2 months for every year after 1954

1960 +

67

Collecting Benefits Early: Your Primary Insurance Amount (PIA) is payable at your Full Retirement Age (FRA). You can collect a benefit as early as age 62. However, if you choose to do so, you will permanently reduce your benefit. Your benefit will not be adjusted or increased to FRA benefit levels when you attain your FRA. The amount of your reduction will depend on two things: your FRA and the number of months until you attain it. If you start receiving benefits at age 62, you will receive the maximum reduction.

FRA Monthly Benefits Reduction 65 20% 66 25% 67 30%

Waiting to Collect Benefits: If you choose to delay collecting benefits beyond your Full Retirement Age, Social Security will give you a delayed retirement credit increase of 8% annually until age 70.

Working while collecting benefits: If you collect benefits prior to Full Retirement Age (FRA), you will be subject to an earnings test every year until you reach FRA. If your earnings are over a certain limit, Social Security will withhold part or all of your benefits.

Note: the earnings test only looks at salary or wages of the person collecting benefits, not the wages of a spouse or any other type of income.

2013 Retirement Earnings Limits: Under FRA $1 of benefits withheld for every $2 in earnings over $15,120/yr Year Individual Reached FRA $1 of benefits withheld for every $3 in earnings over $40,080/yr for the months prior to attaining FRA Month Individual Reached FRA & Beyond Reduction no longer applies.

Collecting Benefits as a Spouse If you are married to an individual who files for Social Security (SS) retirement benefits and you are at least age 62, you may be entitled to collect spousal benefits. Spousal benefits will be equal to 50% of your spouse’s Primary Insurance Amount (PIA). If you are entitled to your own benefits, your benefits will always be paid first. If your benefits are less than 50% of your spouse’s PIA, spousal benefits will be paid in addition to your own. These combined benefits will equal 50% of your spouse’s PIA, assuming you start collecting at Full Retirement Age (FRA) or later. For example, a husband has a PIA of $2,600. The wife is entitled to 50% of her husband’s PIA or $1,300, as spousal benefits. However, because she is entitled to her own PIA benefits of $600, the spousal benefits will be reduced by that amount. The wife, starting to collect at FRA, will receive a combination of benefits: $600 (own) and an additional $700 (spousal) to equal $1,300. Together, the husband and wife would collect a total of $3,900 ($2,600 + $1,300).

What if you wait to collect spousal benefits?

Unlike your own benefits, spousal benefits will not receive delayed retirement credits if you defer collecting them beyond Full Retirement Age (FRA). Spousal benefits are at their maximum when you reach FRA, so there is no advantage to defer collecting them.

What if you are divorced?

If you are not currently married, but had previously been married to the same individual for at least 10 years, you would be entitled to collect spousal and/or survivor benefits. You may be entitled to spousal benefits once both you and your ex-spouse reach age 62. You are not required to wait until your ex-spouse files for benefits.

Collecting Survivor (Widower) Benefits If you have been married for at least nine months and your spouse passes away, you may be entitled to survivor benefits. The amount of your survivor benefits is dependent on when your spouse commenced benefits. If the death occurs prior to your spouse collecting benefits, your survivor benefits will be equal to 100% of your spouse’s Primary Insurance Amount (PIA) when you reach Full Retirement Age (FRA). If your spouse had begun collecting benefits, your survivor benefits will equal his or her actual benefits, assuming you have reached FRA. The survivor benefits will replace your other Social Security benefits if higher.

Filing and Suspending If you are at least Full Retirement Age (FRA), you can elect to file for benefits but suspend collecting them until a later date. This would enable your current spouse to collect spousal benefits while your own benefits earn deferred credits. Filing and suspending also enables you to retroactively start collecting as of your filing date if you change your mind about suspending.

Choosing Between Benefits

Step #6: Insure for the unexpected.

Nobody likes to think about death, but we all need to plan for it. One of the most important things you can do to protect your family is to have adequate insurance. What is adequate? We can run a personalized evaluation to determine if your current insurance amount is adequate for your needs.

If you are married, have children, own a home, are subject to estate taxes, or are responsible for other family members, you should probably have life insurance. The general rule of thumb is own enough life insurance to pay off your debts and current income needs for 5-7 years.

Life Insurance There are several types of life insurance available to suit various needs and budgets.

TERM LIFE INSURANCE

If you are entitled to both individual and survivor benefits, you can choose to begin collecting one and then switch to the other at a later date. Similarly, if you are at least Full Retirement Age (FRA) and married, you can claim spousal benefits only and then switch to your own benefits at a later date.

Windfall Elimination Provision (WEP) If you work for an employer who does not withhold FICA taxes from your salary, such as a government agency or school district, the pension you receive based on that work may reduce your Social Security (SS) retirement benefits. WEP primarily affects individuals who earned a pension in any job where FICA taxes were not paid and who worked in other jobs long enough to qualify for SS retirement benefits.

Government Pension Offset Individuals who receive a pension from a federal, state, or local government based on work where FICA taxes were not withheld may have their SPOUSAL/SURVIVOR benefits reduced. Social Security (SS) benefits will be reduced by 2/3 of the government pension.

For example, if an individual receives $1,500 from a government pension, 2/3 of that pension is $1,000. The individual’s spouse passes away and is eligible for a spousal benefit of $1,800. Under the Government Pension Offset, this individual would be entitled to survivor benefits of $800 ($1,800 - $1,000).

For Additional Information Most of you have been paying into FICA or Social Security for most of your working years. Before starting benefits, take some time to understand and know your benefit options. We can run a personalized Social Security report for you in the office. You can also visit ssa.gov for more information.

Sources: ssa.gov and Blackrock

Term life insurance is like renting. You rent a policy for a specified amount of time, for a specified premium, for a specified death benefit. For example, you may be able to get a 20 year $100,000 policy for $100/month (depending on age and health). At the end of the 20 year term, the policy will expire unless you decide to renew at a higher premium. This type of policy is cheaper compared to a permanent policy which is often used to “I witnessed first-hand cover specific needs that will disappear in time, like a the effects of proper mortgage.

PERMANENT LIFE INSURANCE

Permanent life insurance is like owning. You own your policy and it provides lifelong protection. You may hear it referred to as whole life, universal life, variable life, and indexed universal life insurance. As long as you pay premiums, the death benefit will be there.

Disability Insurance: If you are the primary breadwinner, or you run your own business, you may want to consider disability insurance.

Disability income will help replace your salary or wages by providing monthly benefits in the event of a temporary or permanent disability.

Long-term care insurance: Long-term care (LTC) insurance is an insurance policy that offers benefits to pay for care or treatment for an injury, illness, or loss of functional capability. LTC insurance offers many benefits, including a way for a family to protect itself against the high cost of nursing homes.

planning when my father-in-law passed away after a long battle with cancer.

Fortunately he had planned ahead and owned sufficient life insurance. It gave my mother-in-law, and all of us involved, peace of mind to know she would be comfortable financially, and she could continue to live in the same house where they had raised their 4 children and lived for the past 26 years.”

Step #7: Consolidate your accounts.

Step #8: Plan for emergencies.

If you are like most people, you have more than one retirement account. Maybe you have a 401k with your current and old employer(s) or an IRA with multiple advisors and one at the bank. While there are no rules regarding how many IRA’s and 401k accounts a person can have, trying to manage multiple accounts can be a headache and lead to unnecessary complications and unwanted potential mistakes. Consider consolidating your multiple IRA’s and 401k’s into a Single IRA. This will help in at least 3 ways:

Prepare yourself and your family for the event of an unforeseen situation. When you’re in a crisis, it’s very difficult to think clearly and calmly about the best course of action. That’s why I strongly encourage you to prepare now, when you have time to think about your options and plan ahead. Take 30 minutes and complete the emergency preparedness worksheet, so you will have it at your fingertips if/when the need ever arises.

1. Dramatically simplify your record keeping.

Financial Emergencies:

2. Help you avoid overlooking important IRS deadlines like Required Minimum Distributions (RMD’s).

RMD’s are generally minimum amounts a retirement plan account owner must withdraw annually starting with the year that he or she reaches 70 ½ years of age or, if later, the year in which he or she retires.

However, if the retirement plan account is an IRA, or the account owner is a 5% owner of the business sponsoring the retirement plan, the RMDs must begin once the account holder is age 70 ½, regardless of whether he or she is retired. Retirement plan participants and IRA owners are responsible for taking the correct amount of RMDs on time every year from their accounts, and they face stiff penalties for failure to take RMDs. Failing to take an RMD can result in a penalty of 50% of the distribution amount required.

Financial experts agree that an emergency fund is a necessary foundation and vital building block of every financial plan. How big should your emergency fund be? That depends on your monthly living expenses and your occupation. Living expenses should include mortgage, utilities, food, gas, etc. The worksheet under Step #1 will be helpful when calculating your monthly living expense total. Depending on your occupation, you should have between 3 and 6 months worth of living expenses in your emergency fund. If your monthly income is stable, 3 months is sufficient. If your monthly income varies, have 6 months worth of expenses saved. Keep your emergency fund in a liquid, safe, interest bearing account, like a savings or money market account. Keep this money separate from your other accounts. An emergency fund is just that, money you have saved for a rainy day; not the “I can’t live without a new 60 inch flat screen TV emergency” account. As an extra precaution, keep a portion of your emergency fund in cash, secured in a very safe place in your home.

3. Reduce asset allocation mistakes and inconsistent or contradictory beneficiary designations.

Rule of Thumb: If you are no longer at your old job, your money shouldn’t be there either.

* Advice: To simplify the process, find a Financial Professional (preferably a Certified Financial Planner, CFP®) whom you personally LIKE and TRUST. Consolidate your accounts with that person.

Medical Emergencies Plan ahead. Write down and keep in a safe convenient place all your vital medical information for you and your family. Include physician name and numbers, blood types, allergies, medications, insurance ID numbers and coverage terms.

The worksheets on the following pages are a great tool and guideline to get this done.

“Be Prepared…. the meaning of this motto is that a scout must prepare themselves by previously thinking out and practicing how to act on any accident or emergency so that he/she is never taken by surprise.”

Robert Baden-Powell

Natural Disasters and other Emergencies • Keep a 72 hour kit ready and stored in a convenient, easily accessible location around your home.

• If you are delayed in traffic, is there someone who can pick your kids up from school or day care?

• For more information about 72 hr kits and other emergency preparedness resources visit www.ready.gov.

...Complete the worksheets on the following pages to begin your emergency planning.

Personal Information Sheet Completion Date:

Emergency Contacts Name_________________________________________________relationship _______________________

Self

home phone ( Full Legal Name _________________________________________________________________________ Social Security # __________ – _____ – __________

Date of Birth _______ / _______ / ______

Driver’s License # _______________________________

Passport # _____________________________

Primary Care Physician: ________________________________________ phone (

) _____ – _________

) _____ – ______________

cell phone (

) _____ – _______________

Name_________________________________________________relationship _______________________ home phone (

) _____ – ______________

cell phone (

) _____ – _______________

Children

Medical Plan Name and ID# ________________________________________________________________

Pediatrician: _________________________________________________ phone (

) _____ – _________

Blood Type ____________________________ Allergies ________________________________________

Other Physician:______________________________________________ phone (

) _____ – _________

Day-care Provider:_____________________________________________ phone (

) _____ – _________

Medications ____________________________________________________________________________ Current Employer: _____________________________________________ phone (

) _____ – ________

(Child 1) Full Name _________________________________ Social Security # _______ – ____ – _______

address __________________________________________________________________________

Date of Birth _______ / _______ / ______

supervisor name ________________________________________ email _____________________

Spouse/Domestic Partner

cell phone (

) _____ – _________________

School ___________________________________ address _______________________________ (Child 2) Full Name _________________________________ Social Security # _______ – ____ – _______ Date of Birth _______ / _______ / ______

Full Legal Name _________________________________________________________________________ Social Security # __________ – _____ – __________

Date of Birth _______ / _______ / ______

Driver’s License # _______________________________

Passport # _____________________________

(Child 3) Full Name _________________________________ Social Security # _______ – ____ – _______

) _____ – _________

Medical Plan Name and ID# ________________________________________________________________

) _____ – _________________

School ___________________________________ address _______________________________

Date of Birth _______ / _______ / ______ Primary Care Physician: ________________________________________ phone (

cell phone (

cell phone (

) _____ – _________________

School ___________________________________ address _______________________________ (Child 4) Full Name _________________________________ Social Security # _______ – ____ – _______

Blood Type ____________________________ Allergies ________________________________________

Date of Birth _______ / _______ / ______ School ______________________________________

Medications ____________________________________________________________________________

School ___________________________________ address _______________________________

Current Employer: _____________________________________________ phone (

) _____ – ________

Pets

address __________________________________________________________________________

Pet 1_________________________________________ Pet 2_____________________________________

Veterinarian:________________________________________________ phone (

supervisor name ________________________________________ email _____________________

) _____ – __________

Financial professional

Bank

Financial Professional: _________________________________________ firm _______________________

Bank: _______________________________________________________ phone (

email ______________________________________________ phone (

) _____ – _________

address ________________________________________________________________________

Checking/Savings/CD Account # ________________________________________________________ Bank: _______________________________________________________ phone (

Account 1__________________ Account 2_________________ Account 3__________________ Financial Professional: _________________________________________ firm _______________________ email ______________________________________________ phone (

Bank: _______________________________________________________ phone (

Bank: _______________________________________________________ phone (

Debt

Attorney: ____________________________________________________ firm _______________________

Mortgage ___________________________________________________ phone (

Tax Professional: ______________________________________________ firm _______________________ email ______________________________________________ phone (

) _____ – _________

Insurance Agent: _____________________________________________ agency _____________________ email _______________________________________________________ phone (

) _____ – _________

Life Ins Policy 1 ____________________________________________ Death Benefit _________________ Life Ins Policy 2 ____________________________________________ Death Benefit _________________ Life Ins Policy 3 ____________________________________________ Death Benefit _________________ Life Ins Policy 4 ____________________________________________ Death Benefit _________________ Homeowner’s ________________________________ Auto _____________________________________

) _____ – _________

account # ________________________________________ monthly payment _________________ 2nd Mortgage/HELOC __________________________________________ phone (

) _____ – _________

account # ________________________________________ monthly payment _________________ 2nd Mortgage/HELOC __________________________________________ phone (

Insurance

) _____ – _________

Checking/Savings/CD Account # ________________________________________________________

Attorney and Tax Professional

) _____ – _________

) _____ – _________

Checking/Savings/CD Account # ________________________________________________________

Account 1__________________ Account 2_________________ Account 3_________________

email ______________________________________________ phone (

) _____ – _________

Checking/Savings/CD Account # ________________________________________________________

) _____ – _________

address ________________________________________________________________________

) _____ – _________

) _____ – _________

account # ____________________________________________________ monthly payment ____________ Car Loan: ____________________________________________________ phone (

) _____ – _________

account # ____________________________________________________ monthly payment ____________ Credit Card: __________________________________________________ phone (

) _____ – _________

account # ____________________________________________________ monthly payment ____________ Other Loan: __________________________________________________ phone (

) _____ – _________

account # ____________________________________________________ monthly payment ____________

Umbrella ____________________________________ Disability __________________________________ Long Term Care_______________________________ Other _____________________________________ www.n ie ls o n we alt h .c o m • 303.290.8600

Step #9: Have an estate plan.

The importance of a Will • John Denver went out for a routine plane ride when the unexpected happened. He crashed into the bay and died. What was he thinking? Probably not about the fact that he had left three children and no will, with no directive about the disposition of his $20 million estate.

• Jackie Onassis Kennedy, on the other hand, left an explicit will detailing the handling of her $200 million estate, including specific bequests to her children, gifts for her friends, and 36 pages of directives on the distribution of her property including her Fifth Avenue apartment in New York City and an autographed copy (signed by Robert Frost) of JFK’s inaugural address.

While you may not have $200 million (yet!), it is important that you take control of your legacy and write a will.

Seven out of 10 Americans die intestate, meaning without a will. In fact, each state has its own rules regarding the distribution of property as well as laws that dictate what constitutes the elements of a valid will. Just like any other area of financial planning, knowing the basics can go a long way. Unfortunately, most of us don’t like to think about writing a will, but the best way to provide for your heirs is to do proper planning in life while you can!1 While I strongly urge you to seek professional advice, there are some websites with great information on the subject of wills. Try www.legalzoom.com, www.nolo.com, or do a Google search for “wills and estate planning.”

Congratulations.

You have taken the first steps toward a comfortable and secure retirement.

Estate Planning can help you

• Minimize death expenses.

For more information, or for individualized help and recommendations, contact our office:

• Avoid death taxes.

• Deliver assets to the proper people.

Nielson Wealth Management 303.290.8600.

• Ease the burden on your heirs.

www.nielsonwealth.com

• Name a guardian for young children should you become incapacitated or pass away

Funny Story: Anthony Scott, in his last will and testament, wrote: To my 1st wife Sue, whom I always promised to mention in my will. Hi Sue!

Each person’s situation is unique and estate planning is an area where professional advice is crucial. Some common estate planning tools include life insurance, 529 plans, wills and trusts, long-term care insurance, and gifting. Good legal and financial advice can help relieve stress on your family and help your estate pay as little in taxes as possible.

As with any legal document, keep your will and estate plan current. Any time you have a major life change (death, job change, birth, divorce, marriage, receive an inheritance) you should review your estate plan and make any necessary updates.

1 Bankrate.com

Mike Nielson is a Certified Financial Planner and President of Nielson Wealth Management.

Mike grew up in Idaho, where he was taught to work hard, save his money, and stay out of trouble. His interest in the finance world began early, when he skipped the comic books and spent his pennies on business magazines.

Mike graduated from Utah State University in Business & Finance with an emphasis in financial and retirement planning.

He has been helping people navigate the world of finance, plan for their futures, and attain their financial goals for over a decade, and loves it.

Mike resides in Colorado with his wife and their two children.

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