Project #41821 - Finance

You are a new, but highly educated financial planner and need to prepare some financial statements and answer some questions for your clients, Todd and Sarah Wilkinson.  Since you have been learning from the best financial planning instructor from Amarillo, Texas, you should have no problem providing your clients with the following:

 

Case Requirements

1.     Create a year-end net worth statement and annual cash flow statement for the Wilkinson family given the data on the next page.  

 

2.     Use the financial ratios discussed in the book to identify the Wilkinson’s strengths and weaknesses.

 

3.     Help answer a list of questions that Todd and Sarah have about the industry of financial planning.

 

4.     Identify the Wilkinson’s top spending areas using charts from excel.

 

 

5.     Upload Word and Excel documents (one person for the group needs to submit this). 

 

 

 

 

 

 

 

 

 

 

The Wilkinson Family Profile

The Wilkinson family is your typical suburban family living in Frisco, Texas. Todd and Sarah met at a Journey concert during college and it was love at first sight. They have been married for several years and have two children that currently attend daycare (ages 3 and 8). Todd (age 35) is a sales executive for a large insurance company and Sarah (age 28) is a part time teacher at the local community college.

The Wilkinson’s want to make sure that they are tracking their expenses, meeting or exceeding important financial ratios and understand where they currently are in terms of assets, liabilities and net worth. The Wilkinson’s hope that you can help them with these issues so that they can begin looking at college funding for their children, retirement planning and finally getting out of debt.

 

The Wilkinson’s Financial Information:

Data provided as of 12/31/2013

 
   

Sarah's Monthly Salary

6,000

Jewelry

3,500

401(k) Account (His)

108,657

Dividend/Interest Income

120

401(k) Account (Her)

65,581

Mortgage Payment (PITI)

1,777

Boat

8,000

Infiniti Payment

448

2007 Jeep Patriot

9,000

Jeep Payment

280

Harley Payment

175

Furniture

12,300

BB National Credit Card Payment

195

Infiniti Loan

42,000

Sears Credit Card Payment

200

Brokerage Account

3,700

Cable

105

Alarm System

39

BB National CC

5,237

Life Insurance

100

Internet

100

Gas

300

Cellphone

130

Todd's Monthly Salary

8,000

Harley Davidson

21,000

Water

80

Sears CC

6,200

Entertainment

400

Auto Insurance

268

Child Care

1,200

Home Repairs

200

2010 Infiniti E35

38,500

Groceries

500

Checking (Joint)

2,000

Bank CD (Joint)

3,000

Dining Out

400

Hobbies

300

Savings Account

2,300

Roth IRA (H)

4,295

Club Dues

150

Harley Davidson Loan

18,000

Dry Cleaning

160

Charity

350

Primary Mortgage [i]

178,000

Landscaping

300

Maid

400

Parking and Tolls

45

Dividend/ Interest Reinvestment

120

Student Loan Payment

280

Todd's 401(k) contributions

300

Student Loans H

37,380

Sarah's 401(k) contributions

300

Cash Savings Contribution

600

Jeep Auto Loan

8,500

Todd's Roth Contributions

230

Total Taxes (FICA AND INCOME TAX)

800

Primary Home (VALUE)

271,980

 

 

 

 

 

 

 

Questions

 

1.     Todd and Sarah are very sensitive to commission charges and expenses. Furthermore, they are concerned with the recent horror stories they have heard about in the financial services industry. Assuming that you are a CERTIFIED FINANCIAL PLANNER™ Practitioner, explain to your clients the different types of fee structures a planner can charge and elaborate on the process required to get your designation. Finally, explain fiduciary responsibility and why it is or isn’t important.

 

2.     Todd and Sarah are curious about financial record keeping for their important documents. Please write a summary advising Todd and Sarah on what to do with important and confidential financial records. Pease use three outside references and list the sources for these specific questions.

 

3.     Todd and Sarah feel like they will live in their home forever. They are considering refinancing their home. Todd and Sarah were told by a mortgage broker that they would qualify for a 4.2% rate on a 15 year or 4.6% on a 30 year mortgage. Provide an analysis showing the pros and cons of each decision. Remember to look at financial ratios. Remember that Todd and Sarah are very visual learners. Assume that refinance costs are $5,500 and can be rolled into the new loan if needed.

 

 

4.     Todd and Sarah are concerned if they have adequate insurance for their auto, home and life. They have a split limit policy of $50k/$100k/$50 for liability limits and $500 deductibles, but they don’t understand what this really means. Todd and Sarah also have their home insured 100% of its actual cash value and they have replacement cost coverage on their property. They would like you to explain to them what these numbers mean and provide guidance if needed.

 

5.     Todd’s mom has the following debts which they are highly worried about. They would like to know your recommendation for paying down their debt. Please use PowerPay to show her current schedule and consider how to pay down the debt with an extra $300 per month assuming that Todd’s mom (Nancy) can do cut that in her budget. Please provide a new plan and show how much money she will be saving by allocating $300 per year. Show her the importance of making debt repayment a priority!

 

Type

Balance

Minimum Payment / Rate

American Express

$3,500

$150 / 12.6%

Visa

$,6,000

$225 / 14.8%

Student Loan

$29,722

354.37 / 6%

Auto Loan

$28,488

$647 / 4.2%

Home Equity Loan

$44,766

$506.31 / 6%

 

*Please note that this is the current balance. Not that the student loan and auto loan have been paid on for a few years.

 



Subject Business
Due By (Pacific Time) 10/08/2014 12:00 am
Report DMCA
TutorRating
pallavi

Chat Now!

out of 1971 reviews
More..
amosmm

Chat Now!

out of 766 reviews
More..
PhyzKyd

Chat Now!

out of 1164 reviews
More..
rajdeep77

Chat Now!

out of 721 reviews
More..
sctys

Chat Now!

out of 1600 reviews
More..
sharadgreen

Chat Now!

out of 770 reviews
More..
topnotcher

Chat Now!

out of 766 reviews
More..
XXXIAO

Chat Now!

out of 680 reviews
More..
All Rights Reserved. Copyright by AceMyHW.com - Copyright Policy