Discuss the key factors that Tom should take into consideration for his financial plan and the allocation of savings. In your response make specific references to the case information. (350 words)

Tom: - Is an experienced management consultant and is employed by one of the largest consulting firms in Asia Pacific. Tom recently returned to Australia following a three year role in Singapore. - Tom works long hours and most weekends. Tom is a keen surfer and this interest was a significant factor in his decision to return to Sydney. - Tom lives in a studio apartment (provided by his employer rent free for two years) but would like to purchase an apartment located near the beach before the rent free period expires. - Tom has a good understanding of financial markets and is familiar with risk and return. - Both personally and financially, Tom is considered to be a risk taker.

Case Study Source Information You work as a Financial Planning Adviser and have been asked to assist with three new clients. You have received background information on each client (see below). Client Name Tom Kit and Jo Jim 35 45 and 42 71 Age Status Married, home owners Widower (single), home owner Single, renter of Studio apartment Nil Strategy Consultant AUD195,000 pa from salary Dependents Occupation Net Income (after super and after Nil Two children (age 8 and 9) Accountant and Biochemist AUD175,000 pa (Kit) and AUD130,000 pa (Jo) from salary Retired Doctor AUD85,000 pa total from retirement fund and investment portfolio tax) AUD85,000 pa AUD55,000 pa AUD175,000 pa including the home loan Expenses (living and financial) Major assets Cash at bank AUD115,000 Superannuation AUD220,000 Cash at bank AUD45,000 Superannuation AUD250,000 Home AUD1.8 million Car AUD25,000 Cash at bank AUD30,000 Superannuation AUD1.8 million Home AUD1.5 million Investment portfolio AUD250,000 Car AUD50,000 Nil Home loan AUD1.2 million Major liabilities (interest only loan) Capital Gains Tax liability from recent sale of investment property AUD35,000 (due for payment within one month) Purchase an apartment within two years (price approx AUD1.3 million) with 15% cash and 85% Major financial Operate a conservative budget until the children complete high school in about 9 years time Continue self funded retirement and undertake one overseas holiday each year (approx cost AUD15,000 per holiday additional to normal expenses) goals bank loan Case Study Source Information You work as a Financial Planning Adviser and have been asked to assist with three new clients. You have received background information on each client (see below). Client Name Tom Kit and Jo Jim 35 45 and 42 71 Age Status Married, home owners Widower (single), home owner Single, renter of Studio apartment Nil Strategy Consultant AUD195,000 pa from salary Dependents Occupation Net Income (after super and after Nil Two children (age 8 and 9) Accountant and Biochemist AUD175,000 pa (Kit) and AUD130,000 pa (Jo) from salary Retired Doctor AUD85,000 pa total from retirement fund and investment portfolio tax) AUD85,000 pa AUD55,000 pa AUD175,000 pa including the home loan Expenses (living and financial) Major assets Cash at bank AUD115,000 Superannuation AUD220,000 Cash at bank AUD45,000 Superannuation AUD250,000 Home AUD1.8 million Car AUD25,000 Cash at bank AUD30,000 Superannuation AUD1.8 million Home AUD1.5 million Investment portfolio AUD250,000 Car AUD50,000 Nil Home loan AUD1.2 million Major liabilities (interest only loan) Capital Gains Tax liability from recent sale of investment property AUD35,000 (due for payment within one month) Purchase an apartment within two years (price approx AUD1.3 million) with 15% cash and 85% Major financial Operate a conservative budget until the children complete high school in about 9 years time Continue self funded retirement and undertake one overseas holiday each year (approx cost AUD15,000 per holiday additional to normal expenses) goals bank loan