Financial Pyramid
Financial Pyramid Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
Peopl edon' tpl an t of ai l … t heyf ai lt oplan!
Taking control of your finances and your financial future can help you reach your desired destinations in life. You want to control your finances, not let them control you. You can do this by creating a strong financial foundation upon which you then build in order to achieve your long-term goals.
Wealth Distribution Retirement Income Planning Estate Planning Gift Planning Business Succession Planning
Wealth Preservation Review Investment Results Long-Term Care Insurance Umbrella Liability Insurance
Wealth Accumulation Savings Plan | Personal Investment Strategy Tax-Advantaged Retirement Plans | Business Ownership
Your Financial Foundation Budget and Emergency Fund | Will | Auto/Home Insurance Life Insurance | Health Insurance | Disability Income Insurance
VSA 2A1.36 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
How Much Will You Earn in a Lifetime? Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
Earning Power:
Your earning power –your ability to earn an income –is your most valuable asset.
Your Income
Few people realize that a 30-year-old couple will earn 3.5 million dollars by age 65 if their total family income averages $100,000 for their entire careers, without any raises.
Other Income
Investment Income
Spouse’ sIncome
How Much Will You Earn in a Lifetime?
Years to Age 65
Your Future Earning Power If Your Family Income Averages: $50,000
$100,000
$250,000
$500,000
40
$2,000,000
$4,000,000
$10,000,000
$20,000,000
35
1,750,000
3,500,000
8,750,000
17,500,000
30
1,500,000
3,000,000
7,500,000
15,000,000
25
1,250,000
2,500,000
6,250,000
12,500,000
20
1,000,000
2,000,000
5,000,000
10,000,000
15
750,000
1,500,000
3,750,000
7,500,000
10
500,000
1,000,000
2,500,000
5,000,000
5
250,000
500,000
1,250,000
2,500,000
What steps have you taken to protect your earning power in the event of death or disability? How much of this money will be available to achieve future financial objectives, such as pr ovi di ng f orachi l d’ seducat i on oryourr et i r ement ? How much of your earning power will you save and keep saved?
VSA 2A1.01 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
Capital Needed to Replace Earning Power Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
Of all the assets we own, our earning power is the most valuable!
How much capital would it take to replace your earning power?
For each year that you need this much monthly retirement income:
This is the amount of capital required to provide that monthly income, assuming your capital earns an annual interest rate of: 4%
6%
8%
10%
$ 500
$150,000
$100,000
$75,000
$60,000
1,000
300,000
200,000
150,000
120,000
1,500
450,000
300,000
225,000
180,000
2,000
600,000
400,000
300,000
240,000
3,000
900,000
600,000
450,000
360,000
4,000
1,200,000
800,000
600,000
480,000
5,000
1,500,000
1,000,000
750,000
600,000
10,000
3,000,000
2,000,000
1,500,000
1,200,000
This example is based on the capital retention method, which uses interest return only to provide income. Principal is not liquidated and remains available. This is a hypothetical illustration only and is not indicative of any particular investment or investment performance. It does not reflect the fees and expenses associated with any particular investment, which would reduce the performance shown in this hypothetical illustration if they were included. In addition, rates of return will vary over time, particularly for long-term investments.
VSA 2A1.02 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
Personal Financial Security Needs Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
What Are the Personal Financial Security Needs? In order to provide for themselves and their families, as well as protect the way they live, most people want to provide for one or more of these personal financial security needs...
Pr ot ect i ng YourFami l y’ sFut ur e
How will your family replace your earning power in the event you die prematurely?
Preparing for Your Retirement
What will happen to your standard of living when your earning power ceases at retirement?
Pr ovi di ng f orYourChi l d’ s Education
Preparing for Disability
How much of your earning power will be available to help pay for yourchi l d’ seducat i on?
If you are sick or hurt and unable to work, how will you replace your earning power?
Making Your Home Debt-Free
How much of your earning power will be spent on unnecessary mortgage interest?
Planning Your Estate
Have you made plans to have funds available to pay estate settlement costs at your death?
Which of these needs would be your top priority?
VSA 2A1.03 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
Financial Life Stages Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
Our Changing Financial Focus: While not entirely predictable, our financial needs and objectives do tend to change over time. As they age, most individuals pass through three financial life stages:
First Financial Life Stage:
Life Events
Financial Focus
New to the workforce
In this earliest stage of our adult lives, financial needs tend to focus on:
Newly married Starting a family
Laying a sound financial foundation by establishing a budget, starting a savings plan, making proper use of credit and taking full advantage of employee benefits. Purchasing a home. Building an emergency fund. Implementing an insurance program. Drawing up or updating a will.
Second Financial Life Stage:
Growing family Increasing income
This second stage of our adult lives tends to represent our prime earning years, a time when financial plans should focus on:
Possible inheritance
Saving for college. Taking full advantage of all retirement savings opportunities. Implementing a wealth accumulation program. Protecting wealth through an adequate insurance program. Developing an estate plan.
Third Financial Life Stage:
Nearing retirement Retired Grandchildren Death of a spouse
This last stage of our adult lives can be a rewarding and fulfilling time, assuming important financial issues are addressed: Implementing a retirement income plan, including a distribution strategy and asset allocation suitable for retirement. Having adequate health and long-term care insurance. Updating an estate plan to reflect changing family situations.
VSA 2A1.04 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
Peopl edon' tpl an t of ai l … t heyf ai lt oplan!
Taking control of your finances and your financial future can help you reach your desired destinations in life. You want to control your finances, not let them control you. You can do this by creating a strong financial foundation upon which you then build in order to achieve your long-term goals.
Wealth Distribution Retirement Income Planning Estate Planning Gift Planning Business Succession Planning
Wealth Preservation Review Investment Results Long-Term Care Insurance Umbrella Liability Insurance
Wealth Accumulation Savings Plan | Personal Investment Strategy Tax-Advantaged Retirement Plans | Business Ownership
Your Financial Foundation Budget and Emergency Fund | Will | Auto/Home Insurance Life Insurance | Health Insurance | Disability Income Insurance
VSA 2A1.36 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
How Much Will You Earn in a Lifetime? Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
Earning Power:
Your earning power –your ability to earn an income –is your most valuable asset.
Your Income
Few people realize that a 30-year-old couple will earn 3.5 million dollars by age 65 if their total family income averages $100,000 for their entire careers, without any raises.
Other Income
Investment Income
Spouse’ sIncome
How Much Will You Earn in a Lifetime?
Years to Age 65
Your Future Earning Power If Your Family Income Averages: $50,000
$100,000
$250,000
$500,000
40
$2,000,000
$4,000,000
$10,000,000
$20,000,000
35
1,750,000
3,500,000
8,750,000
17,500,000
30
1,500,000
3,000,000
7,500,000
15,000,000
25
1,250,000
2,500,000
6,250,000
12,500,000
20
1,000,000
2,000,000
5,000,000
10,000,000
15
750,000
1,500,000
3,750,000
7,500,000
10
500,000
1,000,000
2,500,000
5,000,000
5
250,000
500,000
1,250,000
2,500,000
What steps have you taken to protect your earning power in the event of death or disability? How much of this money will be available to achieve future financial objectives, such as pr ovi di ng f orachi l d’ seducat i on oryourr et i r ement ? How much of your earning power will you save and keep saved?
VSA 2A1.01 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
Capital Needed to Replace Earning Power Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
Of all the assets we own, our earning power is the most valuable!
How much capital would it take to replace your earning power?
For each year that you need this much monthly retirement income:
This is the amount of capital required to provide that monthly income, assuming your capital earns an annual interest rate of: 4%
6%
8%
10%
$ 500
$150,000
$100,000
$75,000
$60,000
1,000
300,000
200,000
150,000
120,000
1,500
450,000
300,000
225,000
180,000
2,000
600,000
400,000
300,000
240,000
3,000
900,000
600,000
450,000
360,000
4,000
1,200,000
800,000
600,000
480,000
5,000
1,500,000
1,000,000
750,000
600,000
10,000
3,000,000
2,000,000
1,500,000
1,200,000
This example is based on the capital retention method, which uses interest return only to provide income. Principal is not liquidated and remains available. This is a hypothetical illustration only and is not indicative of any particular investment or investment performance. It does not reflect the fees and expenses associated with any particular investment, which would reduce the performance shown in this hypothetical illustration if they were included. In addition, rates of return will vary over time, particularly for long-term investments.
VSA 2A1.02 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
Personal Financial Security Needs Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
What Are the Personal Financial Security Needs? In order to provide for themselves and their families, as well as protect the way they live, most people want to provide for one or more of these personal financial security needs...
Pr ot ect i ng YourFami l y’ sFut ur e
How will your family replace your earning power in the event you die prematurely?
Preparing for Your Retirement
What will happen to your standard of living when your earning power ceases at retirement?
Pr ovi di ng f orYourChi l d’ s Education
Preparing for Disability
How much of your earning power will be available to help pay for yourchi l d’ seducat i on?
If you are sick or hurt and unable to work, how will you replace your earning power?
Making Your Home Debt-Free
How much of your earning power will be spent on unnecessary mortgage interest?
Planning Your Estate
Have you made plans to have funds available to pay estate settlement costs at your death?
Which of these needs would be your top priority?
VSA 2A1.03 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
Financial Life Stages Presented by:
Kenny Johnson, CCPS, CEAPP JKJ Financial & Insurance Services Prepared for:
Our Changing Financial Focus: While not entirely predictable, our financial needs and objectives do tend to change over time. As they age, most individuals pass through three financial life stages:
First Financial Life Stage:
Life Events
Financial Focus
New to the workforce
In this earliest stage of our adult lives, financial needs tend to focus on:
Newly married Starting a family
Laying a sound financial foundation by establishing a budget, starting a savings plan, making proper use of credit and taking full advantage of employee benefits. Purchasing a home. Building an emergency fund. Implementing an insurance program. Drawing up or updating a will.
Second Financial Life Stage:
Growing family Increasing income
This second stage of our adult lives tends to represent our prime earning years, a time when financial plans should focus on:
Possible inheritance
Saving for college. Taking full advantage of all retirement savings opportunities. Implementing a wealth accumulation program. Protecting wealth through an adequate insurance program. Developing an estate plan.
Third Financial Life Stage:
Nearing retirement Retired Grandchildren Death of a spouse
This last stage of our adult lives can be a rewarding and fulfilling time, assuming important financial issues are addressed: Implementing a retirement income plan, including a distribution strategy and asset allocation suitable for retirement. Having adequate health and long-term care insurance. Updating an estate plan to reflect changing family situations.
VSA 2A1.04 ed. 09-12 Page 1 of 1
VSA, LP The information, general principles and conclusions presented in this report are subject to local, state and federal laws and regulations, court cases and any revisions of same. While every care has been taken in the preparation of this report, neither VSA, L.P. nor The National Underwriter Company is engaged in providing legal, accounting, financial or other professional services. This report should not be used as a substitute for the professional advice of an attorney, accountant, or other qualified professional.
