Vanessa Avoletta is a very successful self-employed freelance writer of romantic novels. She has a reputation for writing rapidly and is able to complete at least four books a year, which net after expenses $25,000 to $50,000 per book per year. With this much income, Avoletta is concerned with both sheltering income from taxes and planning for retirement. Currently she is 40 years old, is divorced, and has a child who is entering high school. Avoletta anticipates sending the child to a quality college to pursue a degree in computer sciences.
She asked you for several alternative courses of action, and you offered the following possibilities.

1. An IRA with a bank with the funds deposited in a variable-rate account.
2. A self-directed Keogh account with a major brokerage firm.
3. A Keogh account with a major mutual fund.
4. An account with a brokerage firm to accumulate common stocks with substantial growth potential but little current income.
How would you reply to each question? Which course(s) of action would you suggest that she pursue? Finally, how would each of the following alter your advice?
1. Avoletta has a record of poor health.
2. Avoletta would like to write less and perhaps teach creative writing at a local college.
3. Avoletta has expensive tastes and finds saving to be difficult.