Client Data$-$Scotty & Casey Young

You recently met with your new clients, Scotty & Casey Young. It was your first formal

meeting; however, they requested that you combine the initial meeting with a data$-$

gathering session. The Youngs were referred to you by a long$-$time client, and they are

interested in a fairly comprehensive review of their finances to include a financial

"checkup," a review of their cash management, including saving, credit management,

housing, insurance needs, and college education planning for their son. They would like

you to start the engagement with an analysis of their current financial situation so that

they can move forward to accomplish their goals.

You learned that Scotty is $40,$ Casey is $32,$ and they have a five$-$year$-$old son, Aaron.

Scotty and Casey also have a dog named Bucky, a lovely six$-$year$-$old Golden Retriever.

Scotty earns $$120,000$ per year as a marketing campaign manager for a regt $5$ nal sports

company, while Casey is a nurse at a local hospital and earns $$94,000$ annually.

They each contribute to their pre$-$tax retirement accounts. Scotty has a $401($k$)$ plan with a

dollar$-$for$-$dollar match on the first $6\%$ of income contributed. Casey's plan is a $403($b$)$

with a $$0\mathrm{.}50$ on the $$1\mathrm{.}00$ match on the first $8\%$ contributed. They are both currently

contributing $6\%$ of their salaries to their retirement plan. Both are fully vested in these

plans, and they have had good success with the returns from their mutual funds in their

tax$-$deferred accounts with an average annual rate of return of about $6\mathrm{.}5\%.$ In addition to

retirement contributions, other payroll deductions include Social Security & Medicare

$($FICA$)$ and federal income tax. The Social Security tax rate is $6\mathrm{.}2\%$ on the first $$168,600$