Easy retirement planning. Please see the requirements.
Review the Case 2 PDF and attach a one-page written executive summary as if you were a professional adviser writing to the client. Research all the issues/needs/questions the clients have and summarize the pertinent assumptions, case facts, and findings. This executive summary should include specific and actionable recommendations.
FINANCE 6080 Case #2
Ned and Nelly Normal
Ned is a pilot and Nelly a school teacher. They have 3 children—all daughters. Kris is 23 and single,
graduated from college and working. Olivia is 20 and half way through college, studying engineering.
Ellie is 13, an 8th grader. Ned will be required to retire at 65 and Nelly plans to work through 65, as well.
Both are currently 50 years old. They would like to maintain their same lifestyle in retirement.
They have the following assets:
His Checking $11,000 Her Checking $13,500
His Savings $10,700 Her Savings $18,000
Employee Stock Purchase Plan $38,600 401(k) at D Airlines $828,932
Rental Property $400,000 Primary Residence $675,000
Whole Life Policy $500,000 Death Benefit
They have the following debts:
Chase Visa—generally about $11,000 and paid in full each month
Residential Mortgage $270,755—pay $1,575 per month at 3.5% for 30 years.
Rental Mortgage–original loan was July 2017 for $336,000. Rate is 4.85%, 30 year loan, they pay $2,225
per month.
New Windows–$16,960 original loan amount was $23,104 with a 66 month amortization at 5.99%, pmt
is about 411.75 per month.
Solar and Roof HELOC –$38,000 for 240 months at 10.5%, payments start next month, but they have
forgotten how much it was exactly
Car Loan–$27,911 balance, originally $35,150 for 72 months at 3.49% with a payment of $541.00
Income includes:
His Salary $295,000 Her Salary $65,000
Military Pension $4,000 per month starting in 5 years Rental Income $24,000
They spend pretty much what they make, but have been able to save about $3,000 per month over the
past year in conjunction with Nelly re-entering the work force. His union has negotiated that his
employer contributes 15% of his wage into his 401(k) up to the IRS limit each year. He also contributes
$4,000 a year into the Employee Stock Purchase Plan.
The Normal’s have the following issues/needs/questions:
1. Will Ned and Nelly be able to retire at age 65 and maintain their current lifestyle with no change
in their spending or savings plan?
2. What adjustments could be made to their financial plan to make retirement at 65 even better
and increase their probability of success?
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