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Spouses have disparate ages

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This is an easier alternative to the 'hubby dies early' procedure.

Let's say one spouse (hubby say) was reasonably predicted to die 10-15 years prior to his wife.

Let us make the year 2041 for argument. The wife is expected to live to (best case/runout age) 2051.

Procedure.....

Run husband with his runout age set to 2041 (his age at 2041) Amortize.

It is important that there be no death benefit (house, insurance) nor DCG elements which don't capitalize prior to hubby's death. In other words, when hubby is amortized, the net income in the final year has no spike.

If there are death benefits, then they should be in the wife's plan. (also, no outstanding LOC either)

After the amortize, we get wife and answer 'no' to the carry-over prompt.

Amortize wife.

Examine the combined ATI after the point of hubby's death. It will probably be low if she is the lesser-asseted spouse. Say her ATI comes in at $21,223 after 2041, whereas the combined ATI before (when her hubby was still in the picture) was 38,123 say. She determines that she would rather have $30,000 instead instead of the 21,223.

Solution.... enter 30,000 in her first column (target) from 2042 -the year after his death- down for the rest of the plan.

Amortize again. Now you will have a plan where husband dies early with his capital running out at his death and wife continues on with a prescribed lifestyle post retirement of $30,000. The lifestyle (combined) pre 2041 will be whatever solves (hopefully greater than the $30K.

IMPORTANT... In order for this to work, the wife should have some investment assets and any death benefits, house, life insurance etc should be in the wife's plan. In other words, when the 1st (the husband's) plan is amortized, there should be no residual slug of extra income in his final year.

A change to this process is the following. Say you didn't want her (the younger spouse) to die broke (amortize).

After you ran (amortized) the first (older) spouse, making sure there was no net income spike in his final year, get the younger spouse, but answer 'yes' to the carry over prompt.

As before, enter an amount in her first column from the year after his death down the rest of the column.

Amortize her. Now you have a plan in which both die broke but with the older spouse dying at an earlier age.

One last scenario would be if the combined die broke ATI in the years prior to his death were inordinately large. In this case they would like to pass on an estate.

Say the combined 'both die broke' plan solved at 65,778 prior to his death and the $30K we forced after his death. If they said.... "65K is too much, we only want a $45K lifestyle prior to hubby's death" The solution is to simply smooth the 2nd spouse at $45K. The result will be $45K pre hubby's death and $30K after hubby's death and an estate which will pass on after her death.

Again, remember that all death benefits (home, life insurance) must reside with her (the younger 2nd spouse to be calculated) and that there be no uncapitalized dcg in his plan at death. His plan, when amortized should show his 'net to estate' (the yellow squares in the capital graph) smoothly disappearing at his runout age.

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