Jim: Jim is a retired doctor. He was married for 25 years until his wife died about
Question:
Jim:
Jim is a retired doctor. He was married for 25 years until his wife died about two years ago. He now lives alone. Financially, Jim is comfortable in retirement – largely as a result of following a financial plan as a married couple for many years.
Jim is active, in good health and helps out as a volunteer in several community activities.
Jim is interested in scuba diving and likes to visit famous reefs and shipwrecks. Many of these sites are overseas. Ideally, he would like to undertake an overseas holiday each year.
Jim is conservative by nature – even more so since retiring and losing his wife. He has no interest in risky investments
Question:
1a) Assess the objective of repaying the car loan within 3 years (assume the interest rate is 8%)
b) Discuss the scope to establish a savings plan to enable Jim to take leave of absence from his job to work overseas as a volunteer in a refugee camp for a period of one year (assume the required savings goal is AUD38,000 and an interest rate on savings of 5%
c) Jim holds a well paid job that offers good career progression. HE is relatively young and has many years remaining in the workforce until retirement. HIS salary should steadily increase with time and the amount of surplus money should also increase.
Outline the types of investments she should consider for the allocation of surplus money.
Foundations of Financial Management
ISBN: 978-1259194078
15th edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen