Setting up Free Memberships

We want to allow visitors to signup to a 'trial' membership for free, but with limitations, as follows:

• Free account
• 3 months active access
• Account can be renewed manually for 3 months at a time. 
• User receives notifications and alerts before expiry. 
• If not renewed, accounts expire and become inactive.
• 6-month grace period
• Account eventually deleted, after grace period expires.

Please advise how to implement this.

That's just normal plan workflow except for the account auto deletion, which I high suggested you do not do. A plan with the following should work fine.

Pricing
Is the first amount and period different: Different first period and price for Registration and Upgrade
First payment price of plan: 0
Initial validity duration: 3 months
Regular Price of plan: 50
Regular Validity duration: 3 months
Grace period before real expiration: 6 months

That should give you a 3 month duration plan with a free first 3 months then following that manual renewal for $50 for 3 months. To send a notification before they expire you'll need to use CBSubs Mailer for that. The below mailer should work fine for this.

Automatically send message starting at: 4 days before
Relative to this date: Subscription's Expiry Date
To which plans this date condition applies: SELECT_3_MONTH_PLAN_HERE
Must be in state: Active
But do not send message if it's later than: 1 day after

That should send an email 4 days before they expire. Adjust to whatever date difference you like. Next up is disabling their account if they expire. That requires a global setting change. In CBSubs > Settings > Global set the following.

Allow Free Registered Users (without subscriptions): No
Create Subscriptions also for free lifetime plans: Yes