Robert and Billy Jean Smith of Rockville, both 44 are typical of a number of Washington area couples. He is a senior planner for IBM, and she sells real estate part time. Together they earn $56,040 a year. They have three children, three cars, a $90,000 house and about $17,00 in savings and securities. The Smiths' net worth is $128,200.

Besides their $26,300 mortgage, they also owe $12,500 on loans for home improvements, cars' bill consolidation and credit cards. On the surface, the Smiths seem to be making out all right, even if their monthly budget shows a deficit of $65 on paper.

But college will be coming up soon for the two older children, David, 17, and Donna, 15. If David doesn't get an athlete scholarship, Bob isn't sure how they can afford $16,000 to pay for David's four years of college. He wonders if that uncertainty will prevent him from buying the boat he wants.Will he have enough money to maintain his present standard of living when he retires. Jeff, 11, is emotionally disturbed, a condition that already costs them $800 a month in school and therapy for him, and the prognosis for this future independence is uncertain.

Bob gives $340 a month support to his widowed mother who lives in a $55.00 paid for house in Florida. She would like to stay but is having difficulty affording the upkeep. Meanwhile B.J. is about to inherit $210,000.

In excellent health working because she was "bored" around the house. B.J. has never had any interest in money and leaves everything to her husband. But she recently become concerned about how much they now have to pay in taxes (the Smith are in the 19 percent bracket.)

Somehow, between his job and their extracurricular activities. Both has had no time to manage his personal finances. He admits there are many things he should have done better. He is beginning to wonder if he will be able to live comfortably when her retires in 13 years.

Although the names [WORDS ILLEGIBLE] Bob and B.J. Smith are actual people. So are Jeff, the disturbed child, and the widowed Mrs. Smith living in Florida, even if they are not related in real life. They and their financial problems, based on three different situations, were melded into a composite family as a case study for financial planners.

It was presented recently at a daylong seminar held by the D.C. Metro Chapter of the International Association of Financial Planners. The object of the [WORD ILLEGIBLE] exercise was to allow the stock brokers [WORD ILLEGIBLE] and insurance agents, accountants, bankers, tax experts, real estate brokers and others who try to fashion comprehensive financial prgrams for individuals, and sometimes for their businesses, to demonstrate in a very short time their collective skills or weaknesses in matters involving income taxes, investments and estate planning.

After the introduction of the case, the planners were assigned to 10 teams of about six persons each and given about one hour to come up with their recommendations. These then were matched against those of a panel of experts who had worked on the problems in advance.

If the Smith family was not altogether typical, neither was the planning. Although large firms do assemble teams to work on a given case, the financial planner just as often works alone, consulting experts only when necessary. As such, the bias of the planner, be he or she a stock broker or an insurance agent, is frequently apt to show up in the proposed program, especially when the planner receives payment through commissions on investment products recommended in the plan.

However, if one accepts that in this situation the difficulty of the case and the lack of time tend to offset the use of the collective wisdom of interdisciplinary teamwork, the results were fairly representatives of the financial planning field. After the hour was up, several team were still talking in vague terms of investment goals while others came up with half a dozen concrete recommendations.

Among the latter teams there seemed to be a general consensus on what the Smiths should do. There was the least agreement on whether to refinance the couple's house to reduce their debts or help pay college expenses and on the proper degree of liquidity and risk for their investments. For example, although many planners spoke of conservatively investing part of B.J.'s inheritance in money market mutual funds, one wild card talked about options and stradles, highly speculatively investments.

The team of experts consisted of David S. Dondero, CFP, of American Financial Consultants, Inc., Jesse L. Sternberger III of the National Bank of Washington, Larry D. Bailey of Peat, Marwick & Mitchell and Gail Winslow, CFP, of Ferris & Co. Wayne O. Hauck of TFI Ltd. presented the results for Sternberger.

Among the recommendations in the long analyses they did were the following:

The Smiths should take their money out of savings and credit union accounts plus Series E bonds and put it into money market mutual funds or no-load municipal bond funds where they will get a considerably higher yield with little risk.

An irrevocable trust should be set up for Jeff in such a way that, should he ever become institutionalized, the State of Maryland will not take all his assets. It is not worth it to set up trusts for the older children at this point.

Bob should not buy his boat now but, when they replace their 1968 Buick, B.J. should buy the new car because she can charge off some of the expense to her real estate business.

Bob should continue to buy IBM stock through his employe stock option plan, which allows him to buy it at 85 percent of current market price. However, if he continues to be dissatisfied with its performance, he should either give it to his children at the rate of up to $3,000 each a year and allow them to sell it because they are in a lower tax bracket or roll it over into other investments. He should not buy raw farmland as an investment because of the risk.

The Smiths should liquidate their credit card debt of $950 on which they are paying 18 percent a year. Contrary to Bob's argument that he is paying for purchases with cheaper dollars by delaying, the planners said that unless Bob, who is in a 49 percent tax bracket, were able to invest the dollars not paid on the credit account at more than 9 percent by paying the minimum amount monthly.

They should increase their auto and property insurance. B.J., who has no insurance on her life, should have about $75,000 in disability insurance, and Bob's should be increased beyond the amount his company would pay. Bob should sell his whole or ordinary life insurance and buy term insurance on his life.

B.J.'s inheritance should be invested so she can have easy access to her money if necessary. The recommendations included putting $20,000 into municipal bonds, with the remainder split between a conservative real estate tax shelter and a conservative portfolio of common stocks.

B.J., who currently gets no benefits from her employer, should set up a defined-benefit Keogh retirement plan which would allow her to put aside up to 23 percent of her earnings annually instead of 15 percent under the ordinary Keogh plan. This way, she could defer $1,690 in taxes each year instead of $1,100 on $15,000 income.As protection in case of divorce, all her assets should be in her name.

Bob's mother should sell him her house and lease it back from him. At enage 67, her proceeds from the house would be tax free, so this would cut the need for Bob's monthly support. If she paid him a fair-market yearly rental of $5400, Bob would realize a $1,370 tax savings on the deal due to depreciation. His annual operating loss would amount to $715, but if he kept the house for at least five years before selling it, he could expect to realize a 7 percent annual return on investment for all those years.

Upon retirement in 1997, the Smiths will need $6,000 a month income. Bob's pension, Social Security and their current savings will provide only $4,400. Yet if they count B.J.'s inheritance and the money form Bob's mother's house, they will be in exceilent shape and can even save a little less than they do now.

The Smiths should draft new wills that could save up to $40,000 in estate taxes, as well as providing care for Jeff and Bob's mother and guardians for the children if no parent survives, Bob's will should leave all to his wife. Hers would leave nothing to him if she died before him but would place all her assets in a trust for her husband's benefit during his lifetime, then passing to Donna and David.

There were some differences even among the experts, such as the question of converting Bob's whole life insurance or assigning it to an irrevocable trust for Jeff's care. some felt the Smiths should invest in common stock rather than in money market funds. In ther tax bracket, the funds are tantamount to a guaranteed loss, explained Vernon D. Gwynne. With a 10 percent yield, the Smiths would net 5 percent, a guaranteed loss of 7 percent when inflation is running at 12 percent annually. Gwynne counseled stocks because of the 60 percent exclusion on capital gains.

This is a brief summary of a detailed financial plan that would cost about $1.600, according to Barry R. Goodman of Goodman & Associates, one of the 10 percent of financial planners who charge a straight fee, no commission. The other 90 percent charge either commission alone or a fee plus commission. (Most of the fee, incidentally, is tax deductible). As the member of persons calling themselves financial planners has increased - the IAPP has 5,800 members [WORD ILLEGIBLE] so have charges of conflict of [WORD ILLEGIBLE] [PARAGRAPH ILLEGIBLE]

The experts approved only the plan done by Merrill Lynch, which cost $1,400. It found those done by an accountant, a life insurance agent and a securities salesman "worse than useless." They told the magazine the $300 plan was "a lengthy canned dissertation of economic generahzations with no really specific plan of action." The $1,650 plan, done by a securities broker, was faulted for its failure to memtion disability, heatlh and property insurance and for recommending too-riskly investments. Several subjects complained of being pressured to buy products.

Alexandra Armstrong of Julia M. Walsh & Sons claimed the test was unfair because the magazine chose two judges who work for fee only: To be fair, one working on commissions also should have been selected, she said.

Bothered by such bad publicity, the IAFP stresses professioalism among its members to oppose those who are dishonest or incompetent. Financial planners as a profession are not regulated in their own right as lawyers, insurance agents or investment advisors. The Securities and Exchange Commission has looked into the possinility of regulating financial planners but has made no decision.

The IAFP is counting on the Certified Financial Planner to create the aura of professionalism that the Certified Public Accountant now enjoys. The CFP is one who has passed a series of tests on subjects that include trusts and wills, insurance investments, tax shelters and pinning. There are about 800 of them in the country now. The courses and exams are administered by a college in Denver. [PARAGRAPH ILLEGIBLE]