Creating a

Lasting Legacy

LIFETIME INCOME CASE STUDY

Presented by Puplava Financial Services, Inc.
Registered Investment Advisor Diane Kruze
 Important Notice:
This is a hypothetical illustration based on real life
examples. Names and circumstances have been
changed. The opinions voiced in this material are
for general information only and are not intended
to provide specific advice or recommendations for
any individual. To determine which investments or
strategies may be appropriate for you, consult
with a financial advisor prior to investing.

Puplava Financial Services, Inc.

Registered Investment Advisor
 ESSENTIAL INFORMATION

Client: Diane Kruze.

Age: 68

Retirement: She is semi-retired.

Life expectancy: Age 95.

Risk tolerance: Conservative.

Investment objective: Income & Preservation of Capital.

 WHO IS DIANE?

Name: Diane
Age: 68
Job: Professor
Diane came to us looking for guidance shortly after the passing of her husband. Her husband retired a few years ago
and left Diane their large nest egg from the recent sale of the family business. Diane is a semi-retired professor,
teaching one class a semester because she says she is not ready to give up her shtick. Education was always very
important to her and her husband and she wants to make sure that her grandkids carry the same high value for
higher education learning. She is not too concerned about retirement given her pension and her overall net worth,
however she is anxious about managing any potential estate taxes. Diane would like to use the family business
proceeds to create a lasting and meaningful legacy for her children and grandchildren, but to also maintain flexibility
and control of the assets while still alive.
 DIANES CURRENT RISK STRATEGY

Most Conservative 1 - 2 - 3 - 4 - 5 - 6 - 7 - 8 - 9 - 10 Most Aggressive

Current Risk Score Portfolio Risk Score

4 5
 WHAT IS IMPORTANT TO DIANE?

Estate Planning

Creating a Legacy

Mitigating taxes

Accomplishing
retirement goals
DIANES RETIREMENT BUDGET

Essentials: $66,000
Discretionary: $32,000
TOTAL: $98,000

Dianes Pension: $57,000

Social Security $31,000
Shortfall: -$10,000
 DIANES ASSETS
Non-Investment Assets
Primary Residence: $355,000

Investment Assets
Husbands Retirement: $401,000
Dianes Retirement: $223,000
Proceeds from sale of business: $1,460,000
Checking & Savings: $120,000

Total Investment Assets $2,204,000

Total Assets: $2,559,000
Liabilities: -$25,000
Net Worth: $2,534,000
DIANES FINANCIAL PLAN CHALLENGES

1. Developing an estate plan that

leaves behind a legacy.

2. Managing the cost of taxes though

retirement.

3. Limiting the impact of WA State

estate taxes.

4. Maintaining flexibility and control of

the nest egg.
DIANES RETIREMENT INCOME STRATEGY

Dianes Pension $57,000/Year

Combined Social Security $31,000/Year
Investment Income
Hubs Retire. $401K Fixed Income & Dividend Payers @ 2.8%1 $16,828
Dianes Retire. $223K Fixed Income & Dividend Payers @ 2.8%2 $14,644
Proceeds $1.46M Fixed Income & Dividend Payers @ 2.8%3 $40,880
Cash $120K N/A

Total Investment Income $72,352

Grand Total Income $160,352
Less Budget $98,000
Surplus $62,352

1, 2, & 3: Yields are for current portfolio yields as of 4/31/17. Please see disclosures at the end of this presentation for security risks.
 GOAL BASED RECOMMENDATIONS
FOR DIANE

Goal Strategy
Since Diane lives in Washington, she would be subject to Washington State estate
taxes which have a threshold of about $2 million. We recommended that she meet
Creating an estate plan with an estate planning attorney to draft a proper trust in preparation for when she
passes. We also offered to work with her to develop gifting strategies to lower her
estate taxes and help create her a legacy that she can leave behind.

We recommended that Diane open a 529 for each of her 6 grandkids and front
loaded 5 years of gifting into each account. Doing this would allow Diane to place
Creating a legacy $70,000 into each of the grandkids 529, coming out to $420,000 in total. While
being able to maintain complete ownership of the assets, Diane would also be able
to mitigate some of the costs of estate taxes.

When RMDs start for Diane in a few years, we recommended that Diane gift her
payments to a charity of choice instead. In doing this, this strategy would help achieve
Managing taxes her philanthropic goals of leaving a lasting legacy as well as lowering her taxes since
she will not have to pay income taxes on the amounts gifted away. In addition, the 529s
would also help with gifting and reduce the potential impact of estate taxes.

Maintaining control and This strategy would be carried about by opening the 529s and drafting a proper
trust which would allow Diane to retain control of the assets while living and then
flexibility fulfill her wishes upon her death.
 Disclosures:
1. Bonds are subject to market and interest rate risk if sold prior to maturity.
Bond values will decline as interest rates rise and bonds are subject to
availability and change in price.

2. The payment of dividend is not guaranteed. Companies may reduce or

eliminate the payment of dividends at any given time.

3. Fixed annuities are long-term investment vehicles for retirement purposes.

Gains from tax-deferred investments are taxable as ordinary income upon
withdrawal. Guarantees are based on the claims paying ability of the issuing
company. Withdrawals made prior to age 59 1/2 are subject to a 10% IRS
penalty tax and surrender charges may apply.

Puplava Financial Services, Inc.

Registered Investment Advisor
Puplava Financial Services, Inc.
Registered Investment Advisor

If you have any specific questions or comments, please give us a call at

(858) 487-3939
Were happy to speak with you.

Post Office Box 503147 - San Diego, CA 92150-3147

10809 Thornmint Road 2nd Floor - San Diego, CA 92127-2403
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