Mr. Bob Smith Age 40 and Mrs. Helen Smith Age 32 live in Calgary with their 2 Children Anna age 8 and Hanna age 11.

Bob has worked as an engineer for 15 years in the Energy Sector for Canadian Natural Resources (CNRL). His income is $150,000 CAD Per year with a 1% Stock option bonus appx 1,500.00 shares issued per year.

He also has a (DCP) pension plan (Conservative portfolio 4-5 % return expectation) he matches his employer contribution of 6% of his income per year into the program that is managed at Sunlife. He sees himself as a conservative risk averse investor preferring safety of capital over growth. He is concerned he has to concentrated a position in oil and gas stocks related to his CNRN stock. He would like recommendations on reducing that risk.

He has a will, POA, and PD and Helen is the sole beneficiary. Bob has a 3 X annual salary term Life insurance policy with his employer. He also has disability insurance, Critical Illness $50,000 and a comprehensive family health benefits program including prescriptions, eye car, dental for the entire family.

Bob wants to retire at 55 with $200,000 per year family income. Assume a 90-year life expectancy. Bob and Helen would also like to sell his (inherited ) condo and buy a new recreation property at Sylvan lake for approximately 1,300,000 in the next 5 years.

Helen is a stay at home mom, she is also a 33% shareholder in a family owned private business that is operated by her brother (KYC Enterprises and Property) she receives annual dividends of $45,000 per year and expects those to remain as long as the business remains in the family.

She intends to pass her business interest off to her children as part of her estate, or in the event of an untimely passing her husband is named beneficiary under her current will. She also has a POA and updated PD as part of the estate plan.

She currently holds an individual 500,000 T- 20 Life Insurance policy with Bob as Beneficiary.

She sees herself as a growth-oriented investor, preferring to take on more risk in an effort to achieve a higher return. She would like to invest some of her Cash currently in savings she expects an 20 % Return on any Investment.

Helen wants to retire fully with Bob at age 55 and agrees that $200,000 per year as a family income in retirement is a good goal. Assume a 90-year Life Expectancy for Bob and Helen. They also wish to leave a 3,000,000 estate to the kids split 50/50.

They will consider a variety of tax efficient investment options including individual stocks, bonds, Mutual Funds, ETF's, and insurance related products.

KYC Information

Utilizing the BMO Investor KYC Questionnaire

Bob and Helen wish to retire fully at age 55. Key goals 200,000 income, purchase a new property at Sylvan Lake 1,300,000. In 5 years.

Bob: Identified as a Conservative Investor looking for inflation protection and safety, willing to accept a - 1-6% volatility in YOY returns.

Helen: Identified as a growth investor interested in growthless concerned with near term portfolio volatility. Able to accept - 11-15% YOY volatility in returns.

Constraints: (Liquidity, Time Horizon, Tax, Regulatory, Personal Circumstance)

Recreation Property goal, 15 years to save- 90 year life expectancy, extensive estate goal for children, taxation of small business assets.

The Current Net Worth Statement:

Assets:

Home 900,000

Personal Property 200,000

Recreation Condo- Sylvan lake 400,000

Car 90,000

Truck 120,000

Investment Assets: Cash CHQ Acct and Emergency Fund 75,000

Cash (Savings Acct CIBC) 500,000 KYC Preferred Shares (4,500 X 1000.00) 4,500,000

CNRL Stock 22,500 Shares Current Price ($80.00) 1,800,000

CNRL (DCP) Pension (Sunlife- Balanced Fund) 300,000

Total: $8,885,000

Liabilities: Credit Cards 80,000.00 Personal Loans HELOC (Prime +.50) 250,000.00

Auto 160,000.00

Total 490,000.00

Net Worth A-L = 8,395,000.00

The Current Cash Flow Statement per annum:

Income:

Bob ( Employment Income) salary 150,000

Helen (Dividend Income) 45,000

Total Family Income: 195,000.00

Annual Expenses:

Lease payments on Auto's 6,000

Payment on HELOC Loan, Payment on Credit Cards 52,800

Other Living Expenses, food , fuel , Etc. 60,000

Discretionary spending, vacations, Etc. 40,000

Total Expenses 158,800.00 Cash Flow: Surplus 36,200.00

The IPS Guidelines

• Use the FP Canada Projection Assumption Guidelines for all Investment planning assumptions. You may also use Bank of Canada guidelines for items such as inflation.

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• The Investment Policy statement should be presented in accordance with IPS Guidelines as specified below.
• efaidnbmnnnibpcajpcglclefindmkaj/https://www.cfainstitute.org/-/media/documents/article/position-paper/investment-policy-statement-individual-investors.pdf

USE THIS FORMATE -

https://www.cfainstitute.org/-/media/documents/article/position-paper/investment-policy-statement-individual-investors.pdf

STATEMENT OF YOUR FINANCIAL OBJECTIVES Our goal is to establish a managed portfolio that achieves real growth, after inflation, with a level of risk that is appropriate for your return. Following are the objectives for your portfolio: To earn a reasonable return net of inflation while minimizing exposure to the stock market fluctuations. To generate a significant amount of portfolio income. Based upon our conversations and the information you provided, and given the long- term nature of your objectives, following is an overview of your investment policy. PORTFOLIO DESCRIPTION PORTFOLIO RATE OF RETURN YOUR CASH REQUIREMENTS INVESTMENT PERIOD YOUR RISK TOLERANCE PORTFOLIO TAX STRATEGIES Together, we selected Sample Portfolio B/Balanced Income as the most appropriate investment portfolio for you now. This portfolio recommendation is designed to generate an average, expected rate of return of 2.5-3.5% above inflation, net of fees and costs. Based on current projections, this equates to a current nominal return of 5.5-6.5%. Currently you are not taking a monthly distribution. Your investment period is over 10+ years. Your risk tolerance is a maximum, aggregate loss of 5% over a one-year time frame. Your portfolio is to be managed as a taxable & tax deferred account, and your combined federal and state tax bracket is to be the marginal tax bracket of 32%. SEE PAGE 6 6 2 2 3 3