What is Wealth Management? INVESTMENT AND INSURANCE PRODUCTS: NOT FDIC INSURED. NOT A BANK DEPOSIT. NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY. NOT BANK GUARANTEED. MAY LOSE VALUE
The Wealth Management Difference Expectations Asset allocation Investment recommendations Stocks Bonds Mutual funds Performance reporting Reality What you may have to spend now and in retirement Ways to fit a ski, lake or beach house into your financial plan How your restricted stock can help you pay college expenses Ways to protect your family if something happens to you Identifying appropriate investments for your portfolio How much you can give to your alma mater and still retire early How to sell your business at an appropriate time for a good price How you can divide assets fairly when planning your estate
As Your Financial Advisor, I Will: Ask questions that help me find out about you, the kind of lifestyle you enjoy, what you want to accomplish for yourself and your family, what worries you and what you re passionate about Prepare a comprehensive plan for you that addresses your income and cash flow needs, borrowing, asset protection, philanthropy and other areas beyond investment management Implement your plan with an objective approach, paying special attention to how the various parts of your plan affect, enhance and integrate with each other
Four Pillars of Wealth Management Your Life Lifestyle Risk Assets Strategic Borrowing
The Big Picture: It s All Connected Income/Cash Flow Risk Assets Liabilities
Comprehensive Process for Life Planning Discovery: Identifying Your Values and Goals Monitoring: Ongoing Evaluation and Reporting YOU Analysis and Recommendations: Building an Action Plan Implementation: Choosing Services and Providers
Discovery Who Are You? Who are your family members and what are they like? What do you like to do? How is work/school/retirement? Goals and Objectives When do you want to retire from your current job? What do you want to do after retirement? Do you plan on paying for your children s education? Do you expect to help an elderly parent with expenses? Do you want to stay in your home or downsize? Values What do you want for your children? What worries you? What are you most passionate about? How would you like to be remembered by your friends and family? Your current financial picture Assets, loans or debts, income, expenses, investments, asset allocation, planning structures, other advisors Risk tolerance Time horizon Attitude toward volatility What s acceptable vs. what s ideal
Analysis and Recommendations Analyze personal and financial information Analyze liabilities (loan rates, fees, terms, repayment requirements, etc.) Assess risks and identify potential threats Coordinate with your attorney, accountant and other advisors as you see fit Propose an action plan aimed at growing, managing, preserving and transferring wealth
Implementation Lifestyle: The life you lead, and what you leave to others. IRAs, 401(k)s, equity compensation and other retirement savings accounts 529 College Savings Plans, Coverdell Education Savings Plans, custodial accounts Trusts and other estate planning structures Strategic Borrowing: Managing your liabilities as strategically as your assets. Home loans and home equity lines of credit Securities-based loans and lines of credit Tailored loans Business capital and commercial loans Charitable trusts, private family foundations, donor-advised fund
Implementation Risk: Anticipating and managing financial threats. Portfolio diversification Hedging strategies for concentrated positions in employer stock Life, disability and long-term care insurance Diversification and liquidity for business owners Tax reduction strategies Citi Identity Theft Solutions Assets: Translating personal goals into financial objectives. Risk analysis and asset allocation Investment Policy Statement Stocks, bonds, mutual funds, annuities, listed options, equity derivatives, CDs Fee-based managed accounts Mutual fund, investment manager and global equity research Guidance on family dynamics Diversification does not ensure against loss.
Monitoring Track progress toward specific goals Group various accounts into portfolios pegged to objectives Sample Retirement Portfolio Cash 8.5% Fixed Income 33.5% Set guidelines for liquidity and asset allocation Limit or exclude holdings in specific sectors or companies Equities 58% Notification when portfolio strays outside pre-set guidelines or limits Performance reporting Online account access For illustrative purposes only.
What the Relationship Means for You Service Stability Scope Dedicated Financial Advisor able to harness global resources High Net Worth Platform of the Year, for 2002, 2003 and 2005, according to Private Asset Management (2) Client advocates Highly diversified earnings base that can help provide stability during difficult market conditions. Moody s Aa1 credit rating (1) $112.5 billion in total equity (1) $1 trillion in total assets (1) In more than 100 countries (1) Integrated custody and reporting services in 30 countries and 20 different currencies (1) Diversity and breadth of products and services (1) Source: Citigroup 2005 Annual Report. (2) Private Asset Management is a subsidiary of Institutional Investor Inc. High-Net-Worth Industry Awards are chosen by their editors, but feedback from the industry is a contributing factor in the selection. The selection of Citigroup Global Wealth Management was based on our innovation, creativity and comprehensive excellence.
Who You Have Behind You Lifestyle Management Risk Management Asset Management Liabilities Management Planning Services Wealth Planning Citigroup Trust Smith Barney Insurance Group Citigroup Hedging and Monetization Smith Barney Consulting Group Citigroup Alternative Investments Citigroup Private Bank Smith Barney Private Client Lending Citigroup Philanthropic Services Citigroup Family Wealth Advisory Services Citigroup Special Equities Group Citigroup Capital Strategies Citigroup Trust Citigroup Family Wealth Advisory Services Portfolio Management Group Citigroup Global Investment Research Executive Financial Services Executive Financial Services
Wealth Management: Next Steps Make an appointment with your Financial Advisor Initial Meeting Discovery of goals and values Financial inventory
Important to Note When used wisely, borrowing can be beneficial to total wealth management. A Smith Barney relationship does not have to be established or maintained to obtain the products or pricing offered as part of the Smith Barney Home loan program at Citibank. Home equity programs not available in AK. A default (stopping monthly payments) on a mortgage could result in the loss of pledged real estate, securities or both. Smith Barney policy does not permit clients to use the proceeds of a home loan to invest in the securities or related markets. Your Financial Advisor may receive compensation in connection with this lending program. Affiliates of Smith Barney may earn fees in connection with the funding, origination, and sale of a loan. All loans/lines are made by Citibank, N.A. or CitiMortgage, Inc., equal housing lenders, and are subject to Citibank s and CitiMortgage s mortgage qualifications. CitiMortgage does business as CitiMortgage in NM. In CT and NJ, Citigroup Global Markets Inc. is the BROKER ONLY, NOT THE LENDER. Citigroup Global Markets Inc. is a registered mortgage broker, NYS Banking department. In AZ, Citigroup Global Markets Inc. is a licensed Mortgage Broker (lic. No. 0903067). Citigroup Global Markets Inc., Citibank, N.A. and CitiMortgage, Inc. are subsidiaries of Citigroup Inc. Borrowing against securities may not be suitable for everyone. If the securities used as collateral decline in market value below maintenance levels, the client may be required to pay down the loan or deposit additional securities as collateral. If the client cannot do so, all or a portion of the collateral may be liquidated and a potentially taxable event may occur. A payment default may result in the loss of the pledged securities. The Citigroup Private Bank is a business of Citigroup Inc., which provides clients with access to a broad array of products and services available through bank and non-bank affiliates. For U.S. clients, trust services are provided by one of the following entities: Citibank, N.A.; Citicorp Trust, N.A. (California); Citicorp Trust, N.A. (Florida); Citicorp Trust South Dakota; Citicorp Trust Bank, fsb; or Citigroup Institutional Trust Company. The service providers are collectively referred to as Citigroup Trust and the entities as the affiliated trust companies. Neither Smith Barney nor its affiliates, including the entities referred to as Citigroup Trust, provide tax or legal advice. Please consult your tax or legal advisors for such guidance. Bonds are subject to interest rate risk. When interest rates rise bond prices fall; generally the longer a bond s maturity, the more sensitive it is to this risk. Bonds may also be subject to call risk, which allows the issuer to retain the right to redeem the debt, fully or partially, before the scheduled maturity date. Proceeds from sales prior to maturity may be more or less than originally invested due to changes in market conditions or changes in eth credit quality of the issuer. Municipal bonds may be subject to state and local taxes, and/or the alternative minimum tax. Past performance is not a guarantee of future results.
Important to Note Life insurance and long-term care insurance are medically underwritten. As such, your actual premiums are not guaranteed and may vary from any initial quotation you receive. You should not cancel your current coverage until your new coverage is approved and in force. A change in policy may be subject to additional insurance and investment-related fees as well as increased risks, and may also require a medical exam. New surrender charges may be imposed with a new contract or may increase the period of time for which the surrender charges apply. Surrenders may be taxable. You should consult your own tax advisors regarding tax liability on surrenders. The Citigroup Global Impact Funding Trust, Inc. (Citigroup GIFT, Inc.) is a 501(c)(3) charitable organization under the Internal Revenue Code of 1986, as amended, and the Citigroup Global Impact Funding Trust (Citigroup GIFT) is a donor-advised fund. Various divisions of Citigroup Inc. and Smith Barney Inc. provide investment management and administrative services to the Smith Barney Charitable Investment Fund (the Fund ). While we believe the Fund represents a valuable philanthropic opportunity, the Fund may not be appropriate for everyone. Please see the Donor Circular & Disclosure Statement for more complete information on the Fund, including a description of the risks, fees and expenses associated with a contribution to the Fund. Read it carefully before contributing. Contributions to the Fund are not insured by the Federal Deposit Insurance Corporation or any other governmental agency, are not a deposit or other obligation of Citigroup Inc. or any depository institution, are not guaranteed by Citigroup or any depositary institution, or Citigroup Global Markets Inc., and are subject to investment risks, including the possible loss of the principal amount contributed. Securities are offered through Smith Barney, a division of Citigroup Global Markets Inc., member SIPC. Citigroup Global Markets Inc. And Citibank are affiliated companies under the common control of Citigroup Inc. Citigroup Inc., its affiliates, and its employees are not in the business of providing tax or legal advice. These materials and any tax-related statements are not intended or written to be used, and can t be used or relied upon, by any such taxpayer for the purpose of avoiding tax penalties. Tax-related statements, if any, may have been written in connection with the promotion or marketing of the transaction(s) or matter(s) addressed by these materials, to the extent allowed by applicable law. Any such taxpayer should seek advice based on the taxpayer s particular circumstances from an independent tax advisor. 2007 Citigroup Global Markets Inc. Smith Barney, Smith Barney Consulting Group, Citigroup Global Investment Research and Citigroup Capital Strategies are divisions and service marks of Citigroup Global Markets Inc. and its affiliates and are used and registered throughout the world. Citi with the arc design is a trademark and service mark of Citigroup or its affiliates is used and registered throughout the world. Citi Identity Theft Solutions is a registered service mark of Citigroup Inc.