1. Getting the Most from Social Security Social Security Workshop Stephanie Farrar, Regional Director for Principal Funds Distributors Quantum Financial Planning Services, Inc. April 24, 2014 1

2. Agenda Know Your Benefit Understand Your Options Maximize Your Benefit Getting Started 2

3. Know Your Benefit 3 Sources for retirement income for average income earners to sustain 80% – 100% of pre-retirement income Employer-Sponsored Retirement Plan and Personal Savings Social Security Source: Social Security Administration, Office of Policy. Office of Research, Evaluation Statistics, Fast Facts and Figures About Social Security, 2010.

4. Know Your Benefit 4

5. 5 Social Security Full Retirement Age Birth YearFull Retirement Age 1943-195466 195566 + 2 months 195666 + 4 months 195766 + 6 months 195866 + 8 months 195966 + 10 months 1960 and later67 Source: 2011 Social Security Administration, ssa.gov/retire2/. Know Your Benefit Full Retirement Age

6. 6 Receive benefits earlier Higher monthly check No penalty for employment Highest monthly paycheck No penalty for employment Smallest monthly check Potential reduction penalty for employment No interim benefits Receive benefits later 6270 AGE PROS CONS Full Retirement Age Know Your Benefit Your Age and Your Benefit

7. Electing your benefit — early vs. late Working while collecting your benefit Examining your tax situation Considering your spouse’s benefit 7 Understand Your Options

8. Early vs. Late 8 130% 120% 110% 90% 80% 70% Early vs. Late Benefit Election Assuming Full Retirement Age at 66. Source: Social Security Administration. 100% 62636465 67686970 Take Benefits Earlier Take Benefits Later Retire at age 66 with full monthly benefit

9. Working While Collecting 9 Understand Your Options AgeEmployment Income 2013 Limits Considerations Under Full Retirement Age $15,120 For every $2 over the limit, $1 is withheld from benefits In the year Full Retirement Age is reached $40,080 For every $3 over the limit, $1 is withheld from benefits until the month in which full retirement age is reached At Full Retirement Age or older* No limits on earnings None * At FRA your benefit amount is adjusted to accommodate for the earlier reduction.

10. Examining Your Tax Situation 10 Understand Your Options Filing Single Provisional Income Benefits Subject to Tax Under $25,0000% $25,000 - $34,000Up to 50% Over $34,000Up to 85% Note: State and local taxes may differ. Married Filing Jointly Provisional Income Benefits Subject to Tax Under $32,0000% $32,000 - $44,000Up to 50% Over $44,000Up to 85% Source: September 2012 Social Security Administration, http://www.ssa.gov/pubs/10035.html.http://www.ssa.gov/pubs/10035.html

11. Consider Spousal Benefits 11 Understand Your Options Option 1 Individual Benefit Option 2 Spousal Benefit Option 3 Survivor Benefit Lower-earning spouse collects his or her own individual benefit Lower-earning spouse may collect a higher spousal benefit (up to 50% of their spouse’s full benefit) if the spouse has filed A widowed spouse may collect survivor benefits (up to 100% of their deceased spouse’s benefit)

12. Consider Spousal Benefits 12 Understand Your Options Social Security Benefits NameAge 62Age 66Age 70 Ann$675$900$1,180 Sam$1,562$2,071$2,733 Spousal Benefit$724$1,035 Sam and Ann, both age 62 Full Retirement Age: 66

13. Maximize Your Benefit 13 Social Security Strategy DefinitionBenefit Claim and Suspend Individuals at FRA or later who have claimed benefits then suspend the benefits. When benefits are reinstated down the road, they will receive a higher benefit amount. Allows spouse to claim spousal benefit, while the higher wage earner can continue to accrue benefits. Can increase the overall lifetime benefits. Claim Now, Claim More Later A FRA individual may claim one- half of their spouse’s benefit, delay taking their own benefit. Earn delayed credits and then claim their higher personal benefit at a later age or may help spouse to receive greater survivor benefit. Do-Over Individuals are allowed to change their earlier claiming decision. Provides flexibility to cease taking benefits if life situation changes.

14. Evaluate what you expect to receive from Social Security Determine when to start taking benefits Apply for retirement benefits 14 Getting Started Maximize Your Benefit

15. 15 An estimate of your Social Security benefits Most recent tax return Most recent pay statement from employer Latest statements from all retirement plans Latest statement from mutual funds Life and disability insurance policies Annuity contracts Wills and trust document(s) Bring Getting Started Maximize Your Benefit

16. Quantum Financial Planning Services, Inc. 509-328-6653 www.QuantumPlanning.com 16 Questions?

17. Principal Funds Disclaimers: The content of this presentation is based upon reliable source material and is believed to be correct as of the time of creation; however it is subject to change at any time without warning. Investors should consider consulting with their tax professionals prior to making decisions due to their unique circumstances. While this communication may be used to promote or market a transaction or an idea that is discussed in the publication, it is intended to provide general information about the subject matter covered and is provided with the understanding that none of the member companies of The Principal ® are not rendering legal, accounting, or tax advice. It is not a marketed opinion and may not be used to avoid penalties under the Internal Revenue Code. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements. Insurance products and plan administrative services are provided by Principal Life Insurance Company a member of the Principal Financial Group® (The Principal®), Des Moines, IA 50392. Principal Funds, Inc. is distributed by Principal Funds Distributor, Inc. Quantum Financial Planning Services, Inc. Disclaimers: Securities offered through Securities Service Network, Inc. Member FINRA/SIPC. Advisory services offered through Quantum Financial Planning Services, Inc., a Registered Investment Advisor. MM4787Q-05 | 11/201 3 | t13112502c3 ©2013 Principal Financial Services, Inc. 17 WE’LL GIVE YOU AN EDGE ® Disclaimers