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PART 1: CASE ANALYSIS AND PRESENTATION

Chapter 1: Introduction to Case Analysis and PresentationIntroduction............................................................................................3PersonalFinancialPlanning.............................................................................3ContentsoftheFinancialPlan .............................................................................. 5EstablishandDefinetheClientRelationship................................................................ 6UnderstandingtheClient’sPersonalandFinancialCircumstances(GatherClientData).....................11IdentifyingandSelectingGoals............................................................................15Analyzing,Developing,Presenting,ImplementingandMonitoring..........................................16Chapter 2: Financial Planning Approaches: Analysis & RecommendationsIntroduction........................................................................................... 21ReasonableAssumptions............................................................................... 21TheAnalysis........................................................................................... 22TheApproachestoFinancialPlanningAnalysisandRecommendations ................................. 23TheLifeCycleApproach................................................................................ 26ThePieChartApproach ................................................................................ 28IncomeStatementPieChart...............................................................................28BalanceSheetPieChart ...................................................................................31SummaryRegardingtheLifeCycleandPieChartApproaches..............................................33TheFinancialStatementandRatioAnalysisApproach .................................................. 34LiquidityRatios...........................................................................................34DebtRatios ...............................................................................................36RatiosforFinancialSecurityGoals .........................................................................38PerformanceRatios .......................................................................................44GuideforCalculatingFinancialRatios......................................................................47HessCaseExampleofApplyingthePieChart,FinancialStatement,andRatioAnalysisApproach ........ 49FinancialStatements:StatementofIncomeandExpenses ..................................................50PieChartAnalysisforHessCase ...........................................................................52FinancialRatiosforHessCase.............................................................................53TheTwo-Step/Three-Panel/MetricsApproach ....................................................... 55Two-StepApproach.......................................................................................55Three-PanelApproach ....................................................................................55MetricsApproach .........................................................................................57RiskToleranceandAssetAllocation.......................................................................59ThePresentValueofAllGoalsApproach ............................................................... 62PresentationofthePresentValueofallGoalsApproach................................................ 66

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TheCashFlowApproach............................................................................... 69RiskManagement ........................................................................................69DebtManagement ........................................................................................71SavingsandInvestingManagement .......................................................................76TheStrategicApproach ................................................................................ 78MissionStatement(AnEnduringLong-TermStatement)..................................................78Goals(BroadlyConceivedGoals)..........................................................................78Objectives(NarrowMeasurableObjectives)...............................................................79InvestmentAnalysis ......................................................................................79Chapter 3: Personal Financial Statements: Preparation & AnalysisIntroduction........................................................................................... 81BalanceSheet(StatementofFinancialPosition)........................................................ 82CashandCashEquivalents................................................................................82InvestmentAssets ........................................................................................83PersonalUseAssets ......................................................................................84Liabilities ................................................................................................85ValuingAssetsandLiabilities .............................................................................87NetWorth ................................................................................................87SourcesofInformation ...................................................................................90AccountOwnership ......................................................................................90FootnotestotheFinancialStatements ....................................................................91StatementofIncomeandExpenses ..................................................................... 92Income ...................................................................................................92SavingsContributions ....................................................................................92Expenses .................................................................................................92NetDiscretionaryCashFlows .............................................................................94SourcesofInformation ...................................................................................96ProjectedIncomeStatements .............................................................................96StatementofNetWorth ................................................................................ 97CashFlowStatement ................................................................................... 97Forecasting ............................................................................................ 98ImportanceofBudgeting .................................................................................99FinancialStatementAnalysis ..........................................................................103ComparativeFinancialStatementTools .................................................................. 103RatioAnalysis ........................................................................................... 108FinancialStatementAnalysis-TheBowdens ..........................................................109BrandonandJillBowden ................................................................................ 109CategoriesofFinancialRatios ............................................................................ 113LiquidityRatios ......................................................................................... 113RatiosforFinancialSecurityGoals....................................................................... 122PerformanceRatios ..................................................................................... 125LimitationsofFinancialStatementAnalysis .............................................................. 130

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PART 2: MINI CASES: EXAMPLES & EXERCISES

Mini Case 1: Risk ManagementWilliamandLucyHayes ...............................................................................135TheFamily ..............................................................................................135FinancialGoals&Concerns ..............................................................................135ExternalInformation ....................................................................................135InsuranceInformation ..................................................................................136SuggestedSolution ....................................................................................138Analysis.................................................................................................138RiskManagementPortfolio ..............................................................................138Mini Case 2: Short-Term Goals and ObligationsRyanandTiffanyPierce ...............................................................................141TheFamily ..............................................................................................141FinancialGoals&Concerns ..............................................................................141ExternalInformation ....................................................................................142InvestmentInformation .................................................................................142SuggestedSolution ....................................................................................146AnalysisTools...........................................................................................146HousingRatio1.........................................................................................147HousingRatio2.........................................................................................147FurtherAnalysis ........................................................................................147LookingattheDebt .....................................................................................147Recommendations ......................................................................................147ImpactofImplementingRecommendations..............................................................148PresentationtothePierceFamily........................................................................148Mini Case 3: Education and Education FundingWilliamandKateWindsor ............................................................................149IntroductoryData .......................................................................................149TheFamily ..............................................................................................149ExternalInformation ....................................................................................151Education ..............................................................................................151Assumption .............................................................................................151SuggestedSolution ....................................................................................152DeterminingtheEducationCostusingtheTraditionalApproach .........................................152UsingtheUnevenCashFlowApproachtoCalculatetheNPVof4YearsofEducationExpense .............153FindingFinancialAid ...................................................................................153Mini Case 4: Retirement Needs and Capital Needs AnalysisUdayGupta ...........................................................................................159IntroductoryData .......................................................................................159FinancialGoal ...........................................................................................159EconomicandInvestmentInformation ..................................................................159

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SuggestedSolution ....................................................................................160AnalyticalTool .......................................................................................... 160AnalyticalConclusion .................................................................................... 161NextStep-TalkwithClient .............................................................................. 161PresentationtoClient ................................................................................... 162Summary................................................................................................ 162Mini Case 5: Present Value ApproachCharlesandCharlotteRangle..........................................................................163IntroductoryData....................................................................................... 163SuggestedSolution ....................................................................................164TheRVGoal............................................................................................. 164TheEducationGoal ...................................................................................... 164TheRetirementGoal..................................................................................... 164SummaryofAllLong-TermGoalsinPresentValueTerms ................................................ 165PresentValueofAllGoalsLessCurrentResources ....................................................... 165TheAlternatives......................................................................................... 165Mini Case 6: Tax AnalysisLarryandKayMullen .................................................................................169IntroductoryData....................................................................................... 169TheFamily.............................................................................................. 169FinancialGoals&Concerns.............................................................................. 170ExternalInformation.................................................................................... 170InvestmentInformation ................................................................................. 170PersonalResidence ...................................................................................... 170Assumptions ............................................................................................ 170StatementofFinancialPosition(BeginningofYear) ...................................................... 171IncomeStatement ....................................................................................... 172SuggestedSolution ....................................................................................173

Mini Case 7: Risk Tolerance & InvestmentsTommyandKristineKraft ............................................................................175IntroductoryData....................................................................................... 175InvestmentInformation ................................................................................. 176SuggestedSolution ....................................................................................177

Mini Case 8: Estate PlanningChaseandJanetFisher................................................................................179IntroductoryData....................................................................................... 179FinancialGoals.......................................................................................... 180Assets ................................................................................................... 180SuggestedSolution ....................................................................................181AnalysisofCurrentSituation ............................................................................ 181Recommendations....................................................................................... 181ToAvoidProbate ........................................................................................ 181ToEducatetheGrandchildren ........................................................................... 181ToReducetheGrossEstateUsingaFamilyLimitedPartnershipfortheBusiness ......................... 182TotalResult ............................................................................................. 183

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Mini Case 9: Mini Case & ExercisesAlanandAngelYoung .................................................................................185TheFamily ..............................................................................................185ExternalInformation..................................................................................186EconomicInformation...................................................................................186BankLendingRates.....................................................................................186InvestmentInformation .................................................................................186InternalInformation ..................................................................................186TheResidence ..........................................................................................186InsuranceInformation ..................................................................................186FinancialStatements....................................................................................187InvestmentInformation .................................................................................189TaxInformation .........................................................................................190EstateInformation......................................................................................190GoalsandConcerns ...................................................................................190MiniExercises ........................................................................................191Exercise1-RiskManagement ...........................................................................191Exercise2-DebtManagementandShort-TermObligations..............................................192Exercise3-EducationandEducationFunding ...........................................................193Exercise4-RetirementAnalysis.........................................................................194Exercise5-PVApproachforAllLong-TermGoals .......................................................195Exercise6-TaxAnalysis ................................................................................196Exercise7-RiskToleranceandInvestmentReturns .....................................................197Exercise8-EstatePlanning .............................................................................198

PART 3: COMPREHENSIVE CASE EXAMPLE

John and Mary Burke Case JohnandMaryBurkeCase ............................................................................201MikeMitchell’sPreliminaryConclusionsRegardingtheBurkes: ..........................................204EngagementLetter ......................................................................................207PersonalBackgroundandInformationCollected......................................................208TheFamily ..............................................................................................208ExternalInformation..................................................................................208EconomicInformation...................................................................................208BankLendingRates.....................................................................................209ExpectedInvestmentReturns ...........................................................................209InternalInformation ..................................................................................210InsuranceInformation ..................................................................................210InvestmentInformation .................................................................................211FinancialStatements....................................................................................213IncomeTaxInformation .................................................................................215RetirementInformation .................................................................................215Gifts,Estates,Trusts,andWillInformation ...............................................................215

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InformationRegardingAssetsandLiabilities ..........................................................215Automobile.............................................................................................. 215FinancialGoals.......................................................................................... 215John and Mary Burke Case AnalysisCaseAnalysis .........................................................................................216MikeMitchell’sPreliminaryConclusionsRegardingtheBurkes: .......................................... 216ApplyingFinancialPlanningApproaches ................................................................. 217PieChartApproach ...................................................................................217Introduction............................................................................................. 217DataforPieChartApproach-BalanceSheet1/1/20X2 ................................................... 218DataforPieChartApproach-IncomeStatement1/1/20X2 .............................................. 219FinancialStatementAnalysis-RatioAnalysisApproach .................................................. 220Burkes’RatioAnalysis ................................................................................... 221TheTwo-Step/Three-Panel/MetricsApproach ......................................................222Introduction............................................................................................. 222HomePurchaseAnalysis-ScheduleA .................................................................... 224SavingsSchedule-ScheduleB ........................................................................... 225PaymentSchedule-ScheduleC.......................................................................... 225AutoInterest-ScheduleD............................................................................... 225CommentsonThree-Panel/MetricsApproachAnalysis.................................................. 225RiskToleranceandAssetAllocation ..................................................................... 227ThePresentValueofallGoalsApproach ................................................................. 229SummaryofthePresentValueofAllGoals ............................................................... 230TheCashFlowApproach..............................................................................231BurkeCashFlowApproachwithRecommendations ...................................................... 231AssetsSoldtoPayOffCreditCards-ScheduleA .......................................................... 232StrategicApproach....................................................................................232Introduction............................................................................................. 232MissionStatement(AnEnduringLong-TermStatement)................................................. 232Goals(BroadlyConceivedGoals)......................................................................... 232Objectives(NarrowMeasurableObjectives).............................................................. 232CommentsonStrategicApproach ........................................................................ 233PresentationtoJohnandMaryBurke .................................................................233ProjectedFinancialStatementsandRatios ............................................................233ScheduleA-AnalysisofJohn’s401(k)Plan .............................................................. 233ScheduleB-AnalysisofMary’s401(k)Plan .............................................................. 234ScheduleC-CombinedSavingsRateAfterRecommendations ............................................ 234ScheduleD-IncomeTaxAnalysis ........................................................................ 234ProjectedStatementofFinancialPosition ................................................................ 236ScheduleE-ReconciliationofYear-EndNetWorth ....................................................... 237ProjectedStatementofIncomeandExpenses............................................................ 238SelectedRatios........................................................................................239ScheduleF-CurrentandProjectedRatios................................................................ 239Summary .............................................................................................239ClosingEngagementLetter .............................................................................. 240

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PART 4: COMPREHENSIVE CASES

Case 1: George and Laura Freeman CaseIntroductoryData .....................................................................................245TheFamily ..............................................................................................245FinancialGoals&Concerns ..............................................................................245ExternalInformation..................................................................................246EconomicInformation...................................................................................246BankLendingRates.....................................................................................246InvestmentReturnExpectations.........................................................................246InternalInformation ..................................................................................247FinancialStatements....................................................................................247InsuranceInformation ..................................................................................249InvestmentInformation .................................................................................250InvestmentPortfolio ....................................................................................252IncomeTaxInformation .................................................................................254RetirementInformation .................................................................................254EstatePlanningInformation .............................................................................254OtherInformationRegardingAssetsandLiabilities......................................................255CaseAssumptions .....................................................................................256

Case 2: Alvin and Fran Jackson CaseIntroductoryData .....................................................................................257TheFamily ..............................................................................................257FinancialGoals&Concerns .............................................................................258ExternalInformation..................................................................................258EconomicInformation...................................................................................258BankLendingRates.....................................................................................258InvestmentReturnExpectations.........................................................................258InternalInformation ..................................................................................259FinancialStatements....................................................................................259InsuranceInformation ..................................................................................261EducationInformation ..................................................................................263InvestmentInformation .................................................................................263RetirementInformation .................................................................................266EstatePlanningInformation .............................................................................266CaseAssumptions .....................................................................................266

Case 3: Sharon Laynee CaseIntroductoryData .....................................................................................267TheFamily ..............................................................................................267FinancialGoals&Concerns ..............................................................................268ExternalInformation..................................................................................269EconomicInformation...................................................................................269BankLendingRates.....................................................................................269InvestmentReturnExpectations.........................................................................269

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InternalInformation ..................................................................................270FinancialStatements .................................................................................... 270InsuranceInformation................................................................................... 272Debt .................................................................................................... 273EducationInformation .................................................................................. 274Divorce ................................................................................................. 274InvestmentInformation ................................................................................. 274EstateDocuments....................................................................................... 276OtherInformationRegardingAssetsandLiabilities ...................................................... 276CaseAssumptions .....................................................................................277

Case 4: Argo and Marie Merritt CaseIntroductoryData .....................................................................................279TheFamily.............................................................................................. 279FinancialGoals&Concerns.............................................................................. 279ExternalInformation..................................................................................280EconomicInformation ................................................................................... 280BankLendingRates ..................................................................................... 280InvestmentReturnExpectations ......................................................................... 280InternalInformation ..................................................................................281FinancialStatements .................................................................................... 281InsuranceInformation................................................................................... 283InvestmentInformation ................................................................................. 285OtherInformationRegardingAssetsandLiabilities ...................................................... 287IncomeTaxInformation ................................................................................. 287RetirementInformation ................................................................................. 287EstatePlanningInformation ............................................................................. 288AdditionalCaseInformation ............................................................................. 288Case 5: The Berry CaseIntroductoryData .....................................................................................289TheFamily.............................................................................................. 289FinancialGoals&Concerns.............................................................................. 290ExternalInformation..................................................................................290EconomicInformation ................................................................................... 290BankLendingRates ..................................................................................... 290InvestmentReturnExpectations ......................................................................... 290InternalInformation ..................................................................................291FinancialStatements .................................................................................... 291InsuranceInformation................................................................................... 293InvestmentInformation ................................................................................. 294OtherInformationRegardingAssetsandLiabilities ...................................................... 294MortgageMarketConditions............................................................................. 296Education............................................................................................... 296RetirementInformation ................................................................................. 296IncomeTaxInformation ................................................................................. 296EstateInformation ...................................................................................... 296

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Case 6: John and Jackie Griffin CaseIntroductoryData .....................................................................................297TheFamily ..............................................................................................297FinancialGoals&Concerns ..............................................................................298ExternalInformation..................................................................................298EconomicInformation...................................................................................298BankLendingRates.....................................................................................298InvestmentReturnsExpected ...........................................................................298InvestmentReturnExpectations.........................................................................298InternalInformation ..................................................................................299FinancialStatements....................................................................................299InsuranceInformation ..................................................................................301InvestmentInformation .................................................................................302EducationInformation ..................................................................................305Home...................................................................................................305OtherAssets ............................................................................................305RetirementInformation .................................................................................305EstatePlanningInformation .............................................................................305Debt ....................................................................................................306CaseAssumptions .....................................................................................306

Case 7: Elvis and Adele Singer CaseIntroductoryData .....................................................................................307TheFamily ..............................................................................................307FinancialGoals&Concerns ..............................................................................308ExternalInformation..................................................................................308EconomicInformation...................................................................................308BankLendingRates.....................................................................................308InvestmentReturnsExpected ...........................................................................308InvestmentReturnExpectations.........................................................................309InternalInformation ..................................................................................310FinancialStatements....................................................................................310EducationInformation ..................................................................................312InsuranceInformation ..................................................................................312LiabilityInsurance ......................................................................................313InvestmentInformation .................................................................................314RetirementInformation .................................................................................315EstatePlanningInformation .............................................................................316Debt ....................................................................................................316OtherInformationRegardingAssetsandLiabilities......................................................317CaseAssumptions .....................................................................................317

Case 8: Grayson and Tally Alexander CaseIntroductoryData .....................................................................................319TheFamily ..............................................................................................319FinancialGoals&Concerns ..............................................................................320ExternalInformation..................................................................................321EconomicInformation...................................................................................321

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BankLendingRates ..................................................................................... 321InvestmentReturnExpectations ......................................................................... 321InternalInformation ..................................................................................322FinancialStatements .................................................................................... 322InsuranceInformation................................................................................... 325InvestmentInformation ................................................................................. 326EducationInformation .................................................................................. 329EstatePlanningInformation ............................................................................. 330OtherInformationRegardingAssetsandLiabilities ...................................................... 330CaseAssumptions .....................................................................................331

Case 9: Trevor and Linda Gates CaseIntroductoryData .....................................................................................333TheFamily.............................................................................................. 333FinancialGoals&Concerns.............................................................................. 335ExternalInformation..................................................................................335EconomicInformation ................................................................................... 335BankLendingRates ..................................................................................... 335InvestmentReturnExpectations ......................................................................... 336InternalInformation ..................................................................................337FinancialStatements .................................................................................... 337EducationInformation .................................................................................. 339InsuranceInformation................................................................................... 339InvestmentInformation ................................................................................. 340OtherInformationRegardingAssetsandLiabilities ...................................................... 343CaseAssumptions .....................................................................................345

Case 10: Bob and Candi Sweet CaseIntroductoryData .....................................................................................347TheFamily.............................................................................................. 347FinancialGoals&Concerns.............................................................................. 348ExternalInformation..................................................................................349EconomicInformation ................................................................................... 349BankLendingRates ..................................................................................... 349InvestmentReturnExpectations ......................................................................... 349InternalInformation ..................................................................................350FinancialStatements .................................................................................... 350InsuranceInformation................................................................................... 353InvestmentInformation ................................................................................. 354EducationInformation .................................................................................. 355TruffleTimes ............................................................................................ 355IncomeTaxInformation ................................................................................. 358RetirementInformation ................................................................................. 358EstatePlanningInformation ............................................................................. 358OtherInformationRegardingAssetsandLiabilities ...................................................... 359CaseAssumptions .....................................................................................359

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PART 5: APPENDICES

Appendix A: FundamentalsStandardsofProfessionalConduct.......................................................................363FinancialPlanningProcess ..............................................................................363CFP®ProfessionalDutiesandResponsibilities ..........................................................364PracticeStandardsSummary ............................................................................365DisclosuresMadeOrallyorinWriting ...................................................................365HowtoUsetheCFP®CertificationMarks................................................................365Appendix B: InsuranceHypotheticalInsurancePremiums .......................................................................367RiskManagement.......................................................................................370TypicalCoveredPerilsforAutoandHome ...............................................................370MethodstoDetermineLifeInsuranceNeeds .............................................................371RenewableTermPremiumandYearlyRenewableTermPremium ........................................371FeatureComparisonofCommonLifeInsurancePolicies .................................................372LikelihoodofDisabilityOverDeath ......................................................................372TypesofDisabilityPolicies..............................................................................373COBRABenefits.........................................................................................373WhoNeedsLong-TermCare .............................................................................373Long-TermCarePremiumFactors .......................................................................374CommonFeaturesofLong-TermCarePolicies...........................................................374ListofCoveredPerils-PropertyInsurance ..............................................................374SummaryofHomeownersInsurancePolicies............................................................376Appendix C: InvestmentsFormulas ...............................................................................................377GlobalPortfolioAllocationScoringSystem(PASS)forIndividualInvestors...............................381PASSScoringSystem.....................................................................................382Appendix D: Income TaxIncomeTaxIssues .....................................................................................383SourcesofTaxLaw ......................................................................................383SummaryofPenalties...................................................................................383CourtSystemSummary .................................................................................384IndividualIncomeTaxFormula..........................................................................384PartialListofExclusions ................................................................................385ItemsIncludedinGrossIncome .........................................................................385PartialListofDeductionsforAdjustedGrossIncome.....................................................385PartialListofItemizedDeductions ....................................................................... 386CommunityPropertyStates .............................................................................386QualifiedDividendTaxRates ............................................................................386SummaryofLimitationsonImputedInterest ............................................................387Inclusion/ExclusionofCompensationforDamagesfromInjuries........................................387UniformPremiumTable(Table79)......................................................................387SocialSecurityBaseAmountsforTaxation ...............................................................388DeductibilityofStudentLoanInterest ....................................................................388

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SummaryofAbove-The-LineDeductionsforIndividuals ................................................. 388SummaryofAbove-The-LineBusinessDeductions....................................................... 388SummaryofDeductibleandNondeductibleMedicalExpenses ............................................ 388SummaryofDeductibleandNondeductibleTaxes ........................................................ 389SummaryofDeductibleandNondeductibleInterestExpenseasItemizedDeduction ...................... 389DeductibleMiscellaneousItemizedDeductions .......................................................... 389ClassificationofRentalRealEstateActivities ............................................................. 390HomeOwnershipClassificationforIncomeTaxPurposes ................................................ 390SummaryofSpecificDeductions ......................................................................... 390SummaryofDisallowedLosses .......................................................................... 391TheAmericanOpportunityTaxCreditandLifetimeLearningCreditCompared........................... 391PropertyIssues.......................................................................................392ItemsIncludedinBasis .................................................................................. 392DoubleBasisRule ....................................................................................... 392AssetCategories ......................................................................................... 392HoldingPeriodSummary ................................................................................ 392SummaryofHoldingPeriodRules ....................................................................... 392Long-TermCapitalGainsTaxRatesSummary ............................................................ 393TypesofIncome ......................................................................................... 393AssetsthatQualifyforLike-KindExchangeTreatment ................................................... 393TaxConsequencesofaSection1031Exchange ........................................................... 394ExchangingInsuranceProducts .......................................................................... 394SummaryofMaterialParticipation....................................................................... 394AlternativeMinimumTaxFormula ...................................................................... 395AMTExemptionAmounts ............................................................................... 395AMTPhaseoutThresholds ............................................................................... 395SummaryofItemizedDeductions ........................................................................ 396DeductionsLostUsingAMT.............................................................................. 396Appendix E: Retirement & Social SecurityRetirement ...........................................................................................397InvestmentAssets/GrossPay%Exhibit................................................................. 397InvestmentAssets/GrossPay%WithoutSocialSecurity ................................................ 398InvestmentAssets/GrossPay%WithSocialSecurity.................................................... 398RequiredSavingsRateforRetirement ................................................................... 399BenchmarkforInvestmentAssetsasaPercentageofGrossPay .......................................... 399RequiredEarningRate .................................................................................. 399SummaryofSelectedFactorsAffectingRetirementPlanning ............................................. 400TheDifferencesBetweenPensionPlansandProfit-SharingPlans ......................................... 400CharacteristicsofDefinedBenefitvs.DefinedContributionPlans ......................................... 401DefinedContributionPlanVestingSchedules ............................................................ 401DefinedBenefitPlanVestingSchedule ................................................................... 402ComparisonofRothIRAandRothAccounts .............................................................. 402QualifiedPlanSummaryofCharacteristics ............................................................... 403401(k)Non-DiscriminationTesting ...................................................................... 404VariousRelationshipsandTransactionsinaLeveragedESOP ............................................ 405SummaryofAllowableRollovers ........................................................................ 406SummaryofExceptionsforQualifiedPlansandIRAs..................................................... 407UniformLifetimeTableUsedbyParticipants ............................................................. 408ExcerptfromtheJointandLastSurvivorTable ........................................................... 409

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SingleLifeExpectancyUsedbyBeneficiaries.............................................................411DeathofParticipantSummary ...........................................................................412SourcesofPlanInformation.............................................................................413NQSOandISOSummary .................................................................................415SocialSecurity ........................................................................................416SocialSecurityRetirementBenefitPercentageBasedonAge.............................................416SummaryofSocialSecurityOASDIBenefits(AsaPercentageofPIA) .....................................417AgeFullRetirementBenefitsBegin(NormalAgeRetirement) ............................................418SocialSecurityFullRetirementandReductions*byAge ..................................................418Appendix F: EstatesPowerofAttorneyvs.PowerofAppointment............................................................419PropertyOwnership ....................................................................................419Documents ..............................................................................................422AssetsPassingThroughandAroundtheProbateProcess ................................................423TaxRates ...............................................................................................424SummaryofTransfersDuringLife(IntraFamilyTransfers) ..............................................425Trusts-SummaryofTaxIssues..........................................................................426Charities................................................................................................426UnlimitedMaritalDeduction ............................................................................429SummaryofAlternativeTaxDeductions .................................................................430AlternateValuationDate(AVD) .........................................................................430ComparisonoftheGift,Estate,andGSTTTaxSystems....................................................431GSTT-UnrelatedPersonsandNonlinealDescendents ...................................................431

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