F | Pic 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Chrome File Edit View History Gmail Uplo X W YouTube Ade X 1 = Adeyemi Case Narrative.pdf 2 Maps Bookmarks Profiles Tab Window Ade X File /Users/abdulbarrie/Downloads/Adeyemi %20Case%20Narrative.pdf Begi X FIN AKTS Online Regis... KCC Library Help Chapter 12 A&P R... 1 / 2 1 2 3 4 5 6 7 8 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Ade | (169 X 29 30 31 32 33 34 35 36 Flashcards - Chap... 73% + Kwame and Laticia Adeyemi finar * 9 Kwame's wife Laticia is a blessing in his life. Ever since they met at a medical conference 3 years ago and fell in 10 love, she's always grounded him and gave him a clear sense of direction. At 31 years old, Laticia has an exciting and demanding career of her own. She is a molecular biologist with Pfizer, a pharmaceutical company, making $113,500 a year. They are in a loving and committed relationship and look at all their finances as joint money. 11 12 bus 1100 zoom Begix Dash E-Library Liquid Assets Kwame has $5,000 in his checking and $67,200 in a bank money market account yielding 0.5% per year. Laticia has $4,300 in her checking account. | =S At the age of 36, Kwame Adeyemi recently finished his cardiology fellowship program and finally, after years of intense and expensive training, became licensed to practice medicine as a heart surgeon. With that came an overnight increase in his income from $62,000 to $475,000 a year. Kwame is admittedly not used to his new financial standing. How successful his life was turning out still feels unreal to him, a son of immigrants from Ireland and Ghana. As with most young doctors, his professional training dominated his life for years, leaving him little time or energy to take stock of where he was and where he was going, financially. He readily admits that he doesn't know much about how to manage his money. CUNY Baruch Coll... FIN Family Planning Recently, Laticia felt an increasing desire to start a family. After some discussion and contemplation, the Adeyemis decided to try to have a child, although neither of them is clear about what that change would mean for them financially, and what level of disruption their careers might see. A week ago, Laticia found out she was pregnant. With their busy careers, and now with a kid on the way, Kwame and Laticia realized they needed financial advice. They came to your financial planning practice for help sorting out where they stand financially, where they should be going, and how to get there. Home and Mortgage Laticia came into the relationship owning a co-op apartment, where they both currently live. They love it. There's enough space, even after the baby arrives. In about 7 years, when it's time for their future kid to go to school, they think they might want to move to a quieter neighborhood, perhaps even out to the suburbs. They'll worry about that when the time comes. The market price of the apartment is estimated at $882,000. Laticia initially borrowed $650,000 to buy it; she currently owes $393,000 on the mortgage. It's a 30-year fixed rate mortgage; the monthly payment (principal and interest) is $2,973. Latica doesn't remember what the interest rate is, but they both agree they want to pay off the mortgage as soon as they can, feeling that owning real estate outright is the surest way to financial security. Kwame and Laticia have been diligent trying to pay more than they have to, and they plan to keep doing that. Their monthly apartment maintenance is $700. Real estate taxes are billed at 0.8% of the value of the apartment per year, and homeowner's insurance premiums are $900 a year. FIN x | + CIS Fri Jan 5 2:38 AM Finish update 'e es lo Q M M M M F | Pic 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Chrome File Edit View History Bookmarks Profiles Tab Window Gmail Uplo X W YouTube Ade X 1 = Adeyemi Case Narrative.pdf 2 Maps Ade X File /Users/abdulbarrie/Downloads/Adeyemi%20Case%20Narrative.pdf Begi x FIN AKTS Online Regis... KCC Library Help Chapter 12 A&P R... 2 / 2 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 Ade | (169 X 66 67 68 69 70 71 72 73 74 Flashcards - Chap... 73% + finar X bus 1100 zoom Begi Dash E-Library FIN | =S CUNY Baruch Coll... Living expenses Laticia and Kwame barely buy any groceries, maybe $200 worth a month. They eat out or get food delivery roughly 6 days a week, spending $45 to $60 on each of those days. Their utility bills are $270 a month. Clothing expenses are $250, transportation is $300, entertainment is $100, and other miscellaneous expenses are $1,000 a month. Despite their busy schedules, they try to take one annual vacation together, spending $5,000 in total. With Kwame's increased income, they also recently bumped up their charitable donations to $700 a month. Taxes Having high incomes, the Adeyemis' taxes are also high, although they hope their mortgage and charitable donations will help lower their taxable income significantly. Their federal income tax has not been calculated yet - they hope you can help them with that. New York State and City income tax total is expected to be $46,000 a year. In addition to income taxes, their Social Security taxes total $17,490, and Medicare taxes are $11,379 for the year. Student Loans Kwame just consolidated his student loans at 6.25% interest rate for 10 years. His monthly payment is $3,009. Laticia's current student loan balance is $63,000. Her monthly payment is $1,008, and the interest rate is 3.9%. Employee Benefits Kwame works at South Brooklyn Health (formerly Coney Island Hospital), part of NYC Health + Hospitals Corporation. Doctors there are unionized, and the Union dues are 1.6% of pay. Employees get subsidized health insurance coverage - Kwame's share of premiums to cover his family is $95 per weekly paycheck. Disability, vision, and dental insurance are all provided at no cost to employees. contributions recently to max it out every year. His current balance in the plan is $13,000, and he has been contributing to the Traditional option only. He also has a Roth IRA, where his current balance is $37,000. Investments and Retirement Planning NYC Health + Hospitals employees can participate in the New York City Deferred Compensation Plan (NYC DCP). The plan has both a 401(k) and a 457 components, both of which Kwame can max out every year, if he wanted to. He has heard from colleagues that the 457 plan is better (he doesn't know why), so he set up his Laticia has been contributing $4,000 a year to her Pfizer's Roth 401(k) lately, and has accumulated $52,000 in it. Pfizer provides a generous dollar-for-dollar match of employee contributions up to 4.5% of their compensation. This matching contribution goes into the Traditional type of account; her current balance there is $14,400. Kwame and Laticia are somewhat more conservative investors than most others their age. They understand they need significant equity exposure to achieve a better long-term return, but they get nervous when their investments go down in value. The Adeyemis plan to retire and start receiving their Social Security benefits at the same time, when Kwame is 67 and Laticia is 62 years old. Their monthly Social Security retirement benefits at those ages in today's dollars are estimated to be $3,700 for Kwame and $2,000 for Laticia. They think their retirement expenses in today's dollars will be 70% of their total cash outflows now. Other than Social Security, they will rely only on their retirement accounts to meet their retirement expenses. For planning purposes, they want to assume they will die in the same year, when Kwame is 95 and Laticia is 90 years old. FIN x | + CIS Fri Jan 5 2:38 AM Finish update 'e es lo Q M M M M My Grades - 201 Gmail YouTube INSTRUCTIONS Description Instructions Begin: Adeyemi X Maps taxes - OneDrive x AKTS Online Regis... KCC Library THIS TAX SEASON taxes - OneDrive X bbhosted.cuny.edu/webapps/assessment/take/launchAssessment.jsp?course_id=_2360292_1&content_id=_82110141_1&mode=view FIN 2000 Files 2 X Chapter 12 A&P R... Select 'Begin' to start. Select 'Cancel' to quit. Adeyemi Case N Flashcards - Chap... bus 1100 X E-Library Course Hero CUNY Baruch Coll... Dashboard CIS IS GOING TO BE RUFF The Adeyemi case narrative says: "Their federal income tax has not been calculated yet - they hope you can help them with that." This assignment is where you will help them with that". Before getting started, make sure you have worked through all the Blackboard content above it in the "Taxes" folder. At 33 questions, this might be one of the more time-consuming assignments of the whole course, and the one with the highest point value. As always in this course, there is no time limit for how long you can work on this assignment, as long as you submit it by the deadline. Feel free to take breaks any time you want to, but make sure to dedicate at least a good 2-3 hours to working on the assignment, or you might run out of time. This tax calculation is more complex than the example we did in class. For this assignment, you will need: 1. The "Adeyemi Case Narrative", available in Blackboard's "Files" menu. 2. Your latest version of the "Adeyemi Financial Statements" assignment. It may be easier in some cases to check for Laticia's and Kwame's items of income or expenses needed for their tax calculation in their financial statements than in the narrative of the case. This assumes that the data in your financial statements is correct. 3. The "Tax Tables" sheet, also available in "Files" (to avoid confusion and wrong answers, do not use any other tax tables). 4. Your preferred spreadsheet software (I will refer to Excel in this assignment, but feel free to use Google Sheets, Apple Numbers, or whatever you prefer). Performing all calculations of this assignment in Excel is strongly recommended, as it is more error-proof than doing it on a calculator. understanding BU... Speaking of Excel, here's a tiny 7-minute demo of how to get your Excel fired up for this assignment in a way that increases your productivity and reduces the probability of mistakes. Additionally, my advice and instructions for auto-graded assignments like this one are here. Cancel + Finish update: Begin C Home Insert Draw Page Layout X AutoSave OFF Paste B39 Calibri (Body) I U B A 1 2 ASSETS 3 Checking accouts (kwame) 4 Money Market Account(kwame) 5 checking Account(laticia) 6 Home value Ready V 7 Investments(kwame-NYC DCP & Roth IRA) 8 Investments(laticia-Pfizer's Roth 401K) 9 10 LIABILITIES 11 Mortgage(outstanding balance) 12 student loans (kwame) 13 student loans (laticia) 14 15 16 Net worth 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 cash flow V 12 balance sheet Accessibility: Good to go B Formulas Data Review ' V V + $ 5,000.00 $ 67,200.00 $ 4,300.00 $ 882,000.00 $ 50,000.00 $ 66,400.00 Open recovered workbooks? Your recent changes were saved. Do you want to continue working where you left off? fx $ 393,000.00 $285,955.04 $ 63,000.00 A V C $ 1,074,900.00 $ 741,955.04 $ 332,944.96 ab D View ab E Tell me F Tell me what you want to do Accounting Wrap Text Merge & Center finencial statment G H V % 9 | .00 .00 .0 J Conditional Format Formatting as Table K V L Cell Styles M I.B Insert Delete Format N O 8:8 |8 WE P 1.1.9 < < < I Comments AP 0. Sort & Find & Filter Select Q V R Share Analyze Data Yes No S 100% 5. C Home Insert Draw Page Layout X AutoSave OFF Paste E12 A Calibri (Body) I U B 28 29 total expense 3 kwame income 4 laticia income 5 6 total income 7 8 9 EXPENSES (cash outflows) 10 mortgage payment 11 apartment maintenance 12 real estate taxes 13 homeowner insurance Ready .. 14 groceries 15 dining out/52.5 16 utilities 17 clothing 18 transportation 19 entertainment 20 miscellaneous 21 charitable donations 22 vacation 23 NY state/City taxes 24 Fica tax 25 student loans/both 26 Employee benefit 27 30 31 total income- total expense 32 33 34 35 36 37 38 39 40 41 V cash flow V 12 Formulas Data Review View ' V V Open recovered workbooks? Your recent changes were saved. Do you want to continue working where you left off? fx B C $ 39,583.33 $475,000.00 $ 9,458.33 $ 113,500.00 $ 49,041.67 $588,500.00 balance sheet Accessibility: Good to go $ 2,973.00 $ 35,676.00 $ 700.00 $ 8,400.00 $ $ $ 588.00 $7,056.00 900.00 $ 10,800.00 200.00 $ 2,400.00 $ 1,260.00 $ 15,120.00 $ 270.00 $ 3,240.00 $ 250.00 $ 3,000.00 $ 300.00 $ 3,600.00 $ 100.00 $ 1,200.00 $ 1,000.00 $ 12,000.00 $ 700.00 $ 8,400.00 $ 416.67 $ 5,000.00 $ 3,833.33 $ 46,000.00 $ 2,405.75 $ 28,869.00 $ 4,017.00 $ 48,204.00 $ 380.00 $ 4,560.00 $ 9,657.67 $ 115,892.00 $ 39,384.00 $ 472,608.00 A V D ab E F ab G Tell me Wrap Text v Xfinencial statment Merge & Center H | Accounting V % 9 J .00 .00 .0 K Conditional Format Formatting as Table L V M Cell Styles N I.B Insert Delete Format O P 8:88 |8 Q M 1.1.9 < < < Comments 28 0u V Sort & Find & Filter Select R S Share Analyze Data Yes T No 100%