Tim and Eilene Smithson together earn approximately $62,000 a year after taxes. Through an inheritance and some

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Tim and Eilene Smithson together earn approximately $62,000 a year after taxes. Through an inheritance and some wise investing, they also have an investment portfolio with a value of almost $133,000.

a. How much of their annual income do you recommend they hold in some form of liquid savings as reserves? Explain.

b. How much of their investment portfolio do you recommend they hold in savings and other short-term investment vehicles? Explain.

c. How much, in total, should they hold in short-term liquid assets?

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Related Book For answer-question

Personal Financial Planning

ISBN: 9781439044476

12th Edition

Authors: Lawrence J. Gitman, Michael D. Joehnk, Randy Billingsley

Question Posted: Mar 09, 2024 11:00 PM

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Tim and Eilene Smithson together earn approximately $62,000 a year after taxes. Through an inheritance and some

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a It is generally recommended that individuals have an emergency fund equivalent to 3 to 6 months wo...View the full answer

Personal Financial Planning

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