Cobbs, Allan and Hall RiskWISE Academy Presentation

Cobbs, Allen and Halls RiskWISE Academy 11/08/2011

Disposable IncomeDI = Gross Income – Personal Taxesie. Consumption + Saving= Disposable Income

Discretionary IncomeGross income - Taxes - Necessities=Discretionary Incomeie. AGI – Lifestyle – Dependents=Discretionary Income

Capital v Cash

Season of Margin (Ages 47-67)

The Lost Generation

Discretionary Income Dilemma1996 - First Baby Boomer turns 472011 - First Baby Boomer retires at age 652026 - Last Baby Boomer retires at age 65

Summary of SSA’s 2011 Annual ReportChart D—OASI, DI, and HI Trust Fund Ratios(Assets as a percentage of annual cost)http://www.ssa.gov/OACT/TRSUM/index.html

Societal Shiftgainfully employed v. greedfully entitled

Pew Research CenterMonday, November 7, 2011

So What’s the Solution?

Transfer of a LifetimeTable 1: Boston College FWP Wealth Transfer (Lower Level Estimates) Neg or Zero $1 to $.9M $1M to $4.9M $5M to $9.9M $10M to $19.9M $20M or more TotalNumber of Estates 4,981,7825.67% 76,593,32287.20% 5,325,0556.06% 495,0670.56% 240,7500.27% 203,3360.23% 87,839,311 100.00%Value of Estates ($50,856) - $13,933,317 34.27% $11,361,859 27.95% $3,338,664 8.21% $3,334,276 8.20% $8,687,63521.37% $40,604,894 100.00% - 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 32.90% 29.15% 9.28% 9.65% 18.98%Estate Fees $784 0.05% $523,820 $464,098 $147,692 $153,640 $302,147 $1,592,182100.00% - 3.76% 4.08% 4.42% 4.61% 3.48% 3.92% 3.19% 29.73% 15.20% 17.04% 34.85%Estate Taxes $0 0.00% $270,524 $2,521,800 $1,289,458 $1,445,628 $2,956,108 $8,483,517 100.00% - 1.94% 22.20% 38.62% 43.36% 34.03% 20.89%Bequest to Charity $0 0.00% $717,54211.91% $924,96015.36% $463,6267.70% $526,158 8.74% $3,389,89756.29% $6,022,182100.00% - 5.15% 8.14% 13.89% 15.78$ 39.02% 14.83% 50.58% 30.34% 5.85% 4.92% 8.30%Bequest to Heirs $0 0.00% $12,421,430 $7,451,001 $1,437,888 $1,208,851 $2,039,483 $24,558,653100.00% - 89.15% 65.58% 43.07% 36.26% 23.48% 60.48%Table 2: Boston College FWP Wealth Transfer (Upper Level Estimates) Neg or Zero $1 to $.9M $1M to $4.9M $5M to $9.9M $10M to $19.9M $20M or more TotalNumber of Estates 3,746,158 4.26% 58,915,72567.07% 20,448,961 23.28% 2,794,0773.18% 1,191,398 1.36% 742,991 0.85% 87,839,311 100%Value of Estates ($19,348)- $17,558,323 12.89% $46,863,759 34.41% $19,142,272 14.06% $16,237,734 11.92% $36,374,157 26.71% $136,156,897 100% - 100% 100.00% 100.00% 100.00% 100.00% 100.00%Estate Fees $428 0.01% $664,087 12.02% $2,000,27536.22% $848,144 15.36% $747,373 13.53% $1,262,818 22.86% $5,523,125100% - 3.78% 4.27% 4.43% 4.60% 3.47% 4.06% 2.51% 31.24% 18.49% 17.33% 30.43%Estate Taxes $0 0.00% $1,018,428 $12,687,522 $7,510,733 $7,040,021 12,358,105 $40,614,810100% - 5.80% 27.07% 39.24% 43.36% 33.97% 29.83% 4.01% 17.03% 10.98% 10.48% 57.50%Bequest to Charity $0 0.00% $994,180 $4,216,581 $2,719,327 $2,594,719 $14,238,520 $24,763,327 100% - 5.66% 9.00% 14.21% 15.98% 39.14% 18.19%Bequest to Heirs $0 0.00% 14,881,628 22.80% $27,959,381 42.83% $8,064,06712.35% $5,855,621 8.97% $8,514,71313.04% $65,275,411 100% - 84.76% 59.66% 42.13% 36.06% 23.41% 47.94%Reference: http://www.bc.edu/content/dam/files/research_sites/cwp/pdf/m_m.pdfSource: Boston College The Center on Wealth and Philanthropy (CWP)

Capital Allocation Millionaires Five Largest Asset Classes 30 25 20 15 10 5 0 Public Private Cash Real Estate Bonds Securities Stock Equivalent$1M : $2M 16.8 8.5 18.1 8.8 7.5$5M : $10M 23.6 15.8 15.1 12.4 4.1$10M+ 26.4 28.3 11 12.4 2.3

Cash v. Capital Cultivation

Edifying Short-term Support… Insuring Long-term Sustainability…SHORT-TERM DILEMMA: LONG-TERM SOLUTION:CULTIVATION OF HUMAN ENDOWMENT CAPITALIZATION OF HUMAN ENDOWMENT2 Responsibilities of Advancement: 2 Opportunities for Advancement:1,000 Donors  10%/yr Gifts of Capital=1,100 Donor Households Mission and/or and/or1,000 Donors @$1,100/yr=$1,100,000 Support Gifts of Estates CapacityAttrition Rate @20%/yr $10,000,000 Capital @10% =$1,000,0001,000 Donors  20%/yr=800 Donors Human Financial and/or$1,000,000 Support=$800,000 Institution Individual

AttitudeApproachAudience Access Ask

Conversation for All Seasons

“Where the ‘odds’ are with you.”

Perceived Needs Providence Posterity Property ProblemsProtection

Strategic Alliances

Birmingham, AL EndorsementsRobert Dewhurst, EdD, CSP, CFREExecutive Vice President of Development, Alabama Baptist Children’s Homes & Family MinistriesJack is a highly personable, focused consultant primarily serving charitable organizations. He is highly energeticand possesses a valuable skill set that has had a positively impacts on our organization. His integrity is abovereproach. If you are seeking help in improving your effectiveness it would be worth the investment of time to learnhow he can serve you.Kay Sanford, Director of Development, Care NetJack is one of the most personable gift and estate specialists I have ever met. He is extremely professional andhis passion for planned giving goes beyond just the knowledge of the subject. Jack emphasizes relationshipbuilding, and walks his clients step by step through each process. Above all, Jack is nevercondescending, although his knowledge far surpasses that of most in his position. I have and will continue torecommend Jack to any company seeking help in the planned giving department.Sandor Cheka, III, Development Officer, The Foundry Rescue Mission and Recovery CenterJack is a wonderful professional who is constantly seeks the best for his clients. He contacted me to develop apartnership with one of his clients that would mutually benefit both organizations. The partnership returned greatrewards for both. Jack is diligent in his efforts and is extremely focused on the importance of long term strategicgoals. Jack is a principled businessmen who was easy to work along side.Reference Source: http://www.linkedin.com/in/jackeyer

Jack Eyer, Gift & Estate Design Specialistjack@givingventures.org(205) 202-0205 office(205) 222-5270 mobilehttp://www.linkedin.com/in/jackeyer

Cobbs, Allan and Hall RiskWISE Academy Presentation

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