Alliance Financial Group, IncRegistered Investment Advisory

Securities offered exclusively through

SunAmerica Securities, Inc.A registered broker-dealer not affiliated with Alliance Financial Group, Inc.

Member NASD/SIPC

What will inflation and taxation do to my 401(k)?

Do I have enough insurance?

Will my family be taken care of if something happens to me?

Can I retire??What is Estate Planning?

Are my investments too risky?

Can I afford a vacation home?

Will Social Security Be Enough?

What is Financial Planning?

PurposeFinancial planning is the process evaluating where you are currently, determining where you want to go, and laying out a plan for you to achieve your destination. A plan can show potential weaknesses or pitfalls of your current financial scenario and allow you to make changes (today!) to eliminate or reduce those weaknesses. Planning allows you to make INFORMED decisions about your future.

To create a personalized financial plan we will need a lot of information. You will be presented with a list requesting documents and statements.

From this information three basic statements are created: Net Worth, Cash Flow, and Objectives.

Net Worth

In order to make informed decisions on the future, you need to recognize where you are today. The net worth statement summarizes your assets and liabilities into one document.

Cash Flow

LoansMortgage

Living Expenses

Savings

Taxes

Insurance

How do you use your money?

Humans are creatures of habit. How we spend money today is a good indication of how we will spend it in the future. The cash flow statement analyzes how you use your money. The results can be surprising.

ObjectivesWhat do YOU want to do?

VacationsEstate Planning Future Purchases

If you fail to plan, you plan to fail. The main reason people don’t realize their dreams is because the dream never makes the transition into becoming a tangible goal. A financial plan creates a forum for you to prioritize your goals and gives you direction in achieving them.

Reduce Taxes

IRS

Projections

The Net Worth, Cash Flow, and Objectives statements are then combined to create projections.

Retirement based projections are the most common, but projections are also created for Life Insurance, Estate Taxes, Disability Needs, and many more.

The next slide shows the effect of annual expenses, various goals and objectives on the invested assets. The key is to have enough assets to cover any cash flow shortages.

Retirement Age

Expected Expenses During Retirement

Adjusted for Inflation

¼ of Education Expenses

(Child will pay other ¾ )

Car Purchases

Summer Classes

Option Income

Shortages are Drawn from accounts

Surpluses are added to accounts

Projected balance of all accounts

Airplane Purchase

Projected Pension and Social Security

Retirement GraphThis is a graphical representation of the previous worksheet. It indicates whether you will have sufficient funds throughout your lifetime or if you have a shortage of funds.

Projected Rate of Return

Asset ProjectionThis worksheet compiles all of the invested assets together. It shows the potential rate of return along with deposits and withdrawals.

Annual Net Deposits

Withdrawals

Life InsuranceThis graph shows the amount of life insurance needed

When there is a space between the Capital Needed Line and the Available Assets there is a life insurance need.

When the Available Assets is above the Capital Needed Line there is no need for life insurance.

Life InsuranceThis graph shows the amount of life insurance needed

Adjustments Needed?Some plans show that major adjustments are needed in order to achieve the stated goals and objectives.

In this example, recommendations were made to consolidate debt. The monthly savings were then reinvested. No change in lifestyle was experienced.

Analysis

After the projections are created, a team of professionals with over 50 years of cumulative experience will analyze the projections to determine the strengths and weaknesses of your plan.

A Plan of Action will be written that details recommendations to reduce weaknesses and build upon strengths.

You will have a roadmap, with instructions, directing you on how to achieve your stated goals. Annual updates will ensure that you stay on course.

The end result . . . Confidence of Mind . . . Knowing you are taking steps to put your financial life in order.

The Result