About Us

2. About Us www.tristaradvisor.com 5718 Westheimer Rd. Ste 950a Houston, TX 77057 Tri-Star Advisors is a Houston-based fixed income focused wealth manager dedicated to providing customized financial guidance.  • By contacting us you may be offered information regarding the purchase of various financial products or advisory services.

3. Disclosures • William Payne & Jon Swanburg offer securities through Tri-Star Financial (TSF), a registered Broker Dealer, member FINRA & SIPC, and advisory services through Tri-Star Advisors, Inc. (TSA), an SEC registered investment advisor.. • Neither TSA or TSF provide accounting, legal, or tax advice. Seek competent accounting, tax, and legal counsel for your specific needs, including guidance on which Social Security option makes sense for your situation. Not affiliated with the U.S. government or governmental agency. • This program is for informational purposes only and does not consider your particular investment objectives or financial situation. • All investments carry risk and may be subject to specific restrictions and limitations such as minimum holding periods and additional costs. Any underlying guarantees, principal protection, and rates are subject to the claims paying ability of the issuer. Any strategies contained in this presentation do not assure a profit. • Please review the product specific disclosure, prospectus, Product Placement Memorandum (PPM), or Statement of Understanding (SOI) prior to purchase. • By contacting us you may be offered information regarding the purchase of various financial products or advisory services.

4. Inflation Health Care LTC Market Risk Taxes ` Your Plan IRA/401(k) Roth Investments Lifestyle Legacy Social Security Social Security Rate of Return Pension

5. Total Value of Your Social Security Benefits Social Security Hypothetical illustrations are for informational purposes and are not indicative of your specific situation. Assumes $2,000 monthly Social Security benefit at full retirement age and average life expectancy of 82.5 for a man and 85.1 for a woman.

6. Advice on Social Security Social Security Source: Social Security Administration http://www.ssa.gov/open/webinar-questions-and-answers.html • Social Security representatives can’t give guidance on your particular situation. • Social Security main number: 1-800-772-1213

8. Can You Repeat That?

9. Social Security Reality Social Security • 74% of those collecting Social Security retirement benefits are receiving reduced amounts • They begin taking their benefits early (age 62) • 76% of all women • 71% of all men Source: Social Security Administration’s Annual Statistical Supplement, 2011. http://www.ssa.gov/policy/docs/statcomps/supplement/2011/supplement11.pdf

10. Social Security – Life Expectancy Social Security Source: Social Security Actuarial Life Table. http://www.ssa.gov/oact/STATS/table4c6.html • SSA assumes the following longevity for a 66 year old: • Male: 82 • Female: 85

11. We’re Living Longer Social Security 50% Chance of Living Beyond 25% Chance of Living Beyond Male Healthy At Age 65 85 92 50% Chance of Living Beyond 25% Chance of Living Beyond 94 Female Healthy At Age 65 88 50% Chance of Living Beyond 25% Chance of Living Beyond 97 Couple Both Healthy At Age 65 92 Wharton Financial Institution Center, August 14, 2007

12. Social SecurityCalculators Social Security Source: Social Security Administration http://www.socialsecurity.gov/retire2/AnypiaApplet.html

13. Inflation Health Care LTC Market Risk Taxes ` Your Plan IRA/401(k) Roth Investments Lifestyle Legacy Social Security Rate of Return Pension

14. Social Security Basics Social Security Primary Insurance Amount (PIA) Full Retirement Age (FRA) Eligibility Entitlement Spousal Benefits (and ex-spouse) Survivor Benefits

15. Primary Insurance Amount Social Security www.ssa.gov/mystatement Primary Insurance Amount (PIA) is the basis of most Social Security Benefits PIA is derived from a worker’s lifetime earnings record It is the benefit a person would receive if he/she begins to elect receiving benefits at full retirement age Source: Social Security Administrationhttp://www.ssa.gov/oact/cola/piaformula.html

16. Full Retirement Age Social Security Source: Social Security Administration: Full Retirement Age www.ssa.gov/retire2/retirechart.htm (last modified or reviewed 10/18/2012)

17. Eligible and Entitled Social Security • To be eligible for benefits a worker must… • Have worked long enough (10 years) to earn the required credits • Be age 62 or over • To be entitled to benefits a worker must… • Have met the eligibility requirements above • Have filed a claim (established an account) or have filed and suspended the claim • Note: think of “entitled” as the account being “opened” Source: Social Security Administration: http://www.ssa.gov/OP_Home/cfr20/404/404-0303.htm

18. Social Security Statement www.socialsecurity.gov/mystatement

19. This hypothetical example is for illustrative purposes only and is not a representation of your specific situation.

20. $321,382

21. Spousal Benefits Social Security • The spousal benefit is based on50% of the other spouse’s PIA (Primary Insurance Amount) • As the spouse (or ex-spouse) of an insured worker, you are entitled to a spouse's benefits if you meet the conditions below: • Your spouse is entitled to retirement or disability benefits. • You are not entitled to a benefit based on your own wage history/PIA which equals or exceeds one-half your spouse’s PIA. • You have filed an application for spousal benefits. • You are age 62 or over Source: Social Security Administration http://www.ssa.gov/retire2/yourspouse.htm#a0=0

22. Spousal Benefits –Divorced Social Security • If you are divorced, you can receive benefits based on your ex-spouse’s wage history (even if he/she has remarried) • If collecting as an ex-spouse of an insured worker, you must meet the conditions below: • The marriage must have lasted 10 years; and • You must not currently be married. • You are age 62 or older. • You do not have to wait for your ex-spouse to file for benefits. Source: Social Security Administration http://www.ssa.gov/retire2/divspouse.htm

23. Survivor Benefits Social Security • When you die, members of your family could be eligible for benefits based on your earnings. • Your unmarried children who are under 18 can be eligible to receive Social Security benefits • Your Widow or Widower can receive your benefits: • If you have young children under 16 your spouse can receive a benefit. • If neither of you have started social security, your spouse can receive reduced survivor benefits as early as age 60 and switch to their benefit at full retirement age or delay up to age 70. • If you are both receiving benefits the surviving spouse will receive the larger benefit and forfeit the smaller. Source: Social Security Administration http://www.ssa.gov/survivorplan/index.htm

24. Survivor Benefits Social Security Women Collecting Benefits Source: Social Security Administration’s Annual Statistical Supplement, 2011. http://www.ssa.gov/policy/docs/statcomps/supplement/2011/supplement11.pdf

25. Early Retirement (Age 62) Reduction Amounts Maximize Your Benefit Social Security Source: Social Security Administrationhttp://www.ssa.gov/oact/quickcalc/earlyretire.html

26. Total Value of Your Social Security Benefits Social Security Hypothetical illustrations are for informational purposes and are not indicative of your specific situation. Assumes $2,000 monthly Social Security benefit at full retirement age and average life expectancy of 82.5 for a man and 85.1 for a woman.

27. Total Value of Your Social Security Benefits Social Security Hypothetical illustrations are for informational purposes and are not indicative of your specific situation. Assumes $2,000 monthly Social Security benefit at full retirement age and average life expectancy of 82.5 for a man and 85.1 for a woman.

28. Increase For Delayed Retirement Social Security Source: Social Security Administration http://www.socialsecurity.gov/retire2/delayret.htm

29. Early vs. Late Early vs. Late Social Security Early vs. Late Benefit Election $2,640 +32% 130% Retire at age 66 withfull monthly benefit 120% $2,000 110% 67 68 69 70 100% 62 63 64 65 90% Take Benefits Earlier Take Benefits Later 80% 70% -25% $1,500 Assuming Full Retirement Age at 66. Source: Social Security Administration. http://www.socialsecurity.gov/OACT/quickcalc/early_late.html

30. Working While Collecting Working While Collecting Social Security * Income from work, W-2, and self-employment income. ** At FRA your benefit amount is adjusted to accommodate for the earlier reduction. Source: Social Security Administrationhttp://www.socialsecurity.gov/retire2/whileworking.htm

31. Examining Your Tax Situation Examining Your Tax Situation Social Security * Provisional Income is Adjusted Gross Income including any tax-exempt interest plus 50% of Social Security benefits. Note: Converting a traditional IRA to a Roth IRA is a taxable event and could result in additional impacts to your personal tax situation, including the taxation of current Social Security benefit payments. Consult with a qualified tax advisor before making any decisions regarding your IRA. State and local taxes may differ. Source: Social Security Administrationhttp://www.ssa.gov/planners/taxes.htm

32. Social Security Strategies Social Security 1 Benefit will be reduced if not at Full Retirement Age. Both individuals must have filed for Social Security benefits. 2 Effective December 2010, the Social Security Administration published new rules that recipients may only cancel once and can do so only within the fist 12 months of receiving benefits. Visit ssa.gov for the most current information. Source: Social Security Administrationhttp://www.ssa.gov/retire2/suspend.htm; http://www.ssa.gov/pubs/10035.html

33. Understanding Your Options Understanding Your Options Social Security Sam and Ann, both age 62 Full Retirement Age: 66 $2,286 $3,251 $3,913 $3,106 Survivor = $2,733 Hypothetical illustrations are for informational purposes. Assumes full retirement age of 66; average life expectancy of 82.5 for a man and 85.1 for a woman; early/late benefit calculations found at: http://www.socialsecurity.gov/OACT/quickcalc/early_late.html

34. Comparing Benefits at Different Ages • Sam 66 Ann 70 • $2,071 • $1,180 • $1,035 • $3,251 • $39,012 • $2,071 • $701,353 • Ann 66 Sam 70 • $2,733 • $1,180 • $1,035 • $3,913 • $46,956 • $2,733 • $721,900 • Ann 66 Sam 70 • $2,733 • $900 • $1,035 • $3,633 • $43,596 • $2,733 • $695,020 • Age • Sam • Ann • Spousal Benefit • Total Monthly • Total Annually • Survivor Monthly • Lifetime (to 82.5 & 85.1) • Both 62 • $1,562 • $675 • $724 • $2,286 • $27,432 • $1,562 • $611,090 • Both 66 • $2,071 • $900 • $1,035 • $3,106 • $37,272 • $2,071 • $679,603 Hypothetical example is for illustrative purposes only. Assumes full retirement age of 66; average life expectancy of 82.5 for a man and 85.1 for a woman; early/late benefit calculations found at: http://www.socialsecurity.gov/OACT/quickcalc/early_late.html

35. Comparing Benefits at Different Ages • Age 63 66 70 • Scott Earned benefit $1,550 $2,214 $2,922 • Spousal benefit $613 $1,252 $1,252 • Joanne Earned benefit $1,752 $2,503 $3,304 • Spousal benefit $542 $1,107 $1,107 Hypothetical example is for illustrative purposes only and is not representative of your specific situation. Assumes full retirement age of 66; average life expectancy of 82.5 for a man and 85.1 for a woman; early/late benefit calculations found at: http://www.socialsecurity.gov/OACT/quickcalc/early_late.html

36. Comparing Benefits at Different Ages • Age 63 66 70 • Scott Earned benefit -- $2,922 • Spousal benefit -- $1,252 • Joanne Earned benefit -- $3,304 • Spousal benefit -- • Total $1,252 $6,226 • Survivor benefit $3,304 Hypothetical example is for illustrative purposes only and is not representative of your specific situation. Assumes full retirement age of 66; average life expectancy of 82.5 for a man and 85.1 for a woman; early/late benefit calculations found at: http://www.socialsecurity.gov/OACT/quickcalc/early_late.html

37. Comparing Benefits at Different Ages • Age 66-70 70-79 80-84 Total • Scott $60, 072 $350,698 -- $410,770 • Joanne -- $396,475 $198,238 $594,713 • Total $60,072 $747,173 $198,238 $1,005,482 Hypothetical example is for illustrative purposes only and is not representative of your specific situation. Assumes full retirement age of 66; average life expectancy of 82.5 for a man and 85.1 for a woman; early/late benefit calculations found at: http://www.socialsecurity.gov/OACT/quickcalc/early_late.html

38. Comparing Benefits at Different Ages • Age 63 66 70 • Scott Earned benefit $2,214 $2,214 • Spousal benefit • Joanne Earned benefit $3,304 • Spousal benefit $1,107 • Total $3,321 $5,518 • Survivor benefit $3,304 Hypothetical example is for illustrative purposes only and is not representative of your specific situation. Assumes full retirement age of 66; average life expectancy of 82.5 for a man and 85.1 for a woman; early/late benefit calculations found at: http://www.socialsecurity.gov/OACT/quickcalc/early_late.html

39. Comparing Benefits at Different Ages • Age 66-70 70-79 80-84 Total • Scott $106,272 $350,698 -- $410,770 • Joanne 53,136 $396,475 $198,238 $594,713 • Total $159,408 $662,155 $198,238 $1,019,801 Hypothetical example is for illustrative purposes only and is not representative of your specific situation. Assumes full retirement age of 66; average life expectancy of 82.5 for a man and 85.1 for a woman; early/late benefit calculations found at: http://www.socialsecurity.gov/OACT/quickcalc/early_late.html

40. Inflation Health Care LTC Market Risk Taxes ` IRA/401(k) Roth Investments Lifestyle Legacy Social Security Rate of Return Pension

41. Thank You! www.tristaradvisor.com 5718 Westheimer Rd. Ste 950a Houston, TX 77057