RETIREMENT AND ESTATE PLANNING
Life Situation
Financial Data
Pam, 48
Josh, 50
Children ages 21, 19 and 16
Monthly income $6,700
Assets $242,500
Living expenses $5,600
Liabilities $69,100
With two children in college, the brocks once again find their life situation changing. Compared to five years ago, their total assets have declined due to college expenses. The Brocksâ oldest child will graduate next year, but the youngest will enter college in a couple of years. The drain on the familyâs finances will continue.
While the familyâs finances are adequate, both Pam and Josh are beginning to think more about retirement. Over the years, Josh has taken advantage of different career opportunities. Today his annual salary is higher than ever. However, his employment changes have resulted in a smaller pension fund than would have been available had he remained with the same organization.
The current value of his pension plan is just over $115,000. The investment program he and pam started almost 10 years ago is growing and is now worth about $62,000. But they still worry whether they will have enough money to finance their retirement when Josh retires in 15 years.
Pam and Josh should also be concerned with various estate planning actions. They have talked about a will and investigated the benefits of several types of trusts. However, they have not taken any specific actions.
Questions
Q1. What steps do the Brocks need to take to prepare for retirement?
RETIREMENT AND ESTATE PLANNING
| Life Situation | Financial Data |
| Pam, 48 Josh, 50 Children ages 21, 19 and 16 | Monthly income $6,700 Assets $242,500 Living expenses $5,600 Liabilities $69,100 |
| With two children in college, the brocks once again find their life situation changing. Compared to five years ago, their total assets have declined due to college expenses. The Brocksâ oldest child will graduate next year, but the youngest will enter college in a couple of years. The drain on the familyâs finances will continue. While the familyâs finances are adequate, both Pam and Josh are beginning to think more about retirement. Over the years, Josh has taken advantage of different career opportunities. Today his annual salary is higher than ever. However, his employment changes have resulted in a smaller pension fund than would have been available had he remained with the same organization. The current value of his pension plan is just over $115,000. The investment program he and pam started almost 10 years ago is growing and is now worth about $62,000. But they still worry whether they will have enough money to finance their retirement when Josh retires in 15 years. Pam and Josh should also be concerned with various estate planning actions. They have talked about a will and investigated the benefits of several types of trusts. However, they have not taken any specific actions. Questions Q1. What steps do the Brocks need to take to prepare for retirement? | |
