etirement accounts and education accounts. They assume they will incur 2% in transaction costs The purchase and 6% for the sale. They have asked you the following: A. What will be their payment (principal and interest only) on their new home? B. How much will they be able to invest in their retirement accounts and education accounts after selling the old house and buying the new house? C. If the Jacksons purchase the new house one year from today, what will be the balance on t mortgage when they retire? D. What is the income tax consequence of their sale and purchase strategy? Please show your work for each part of the question. A. 4. Disability Insurance Maximum Points: 10 Jaylen and Avery have asked you to evaluate their current disability insurance coverage. A. What are the cash flow implications if Jaylen were to experience a serious disabling incident before retirement? B. What are the cash flow implications if Avery were to experience a serious disabling incident before retirement? c. What are the tax consequences of receiving disability benefits for Jaylen? D. What are the tax consequences of receiving disability benefits for Avery? INSURANCE INFORMATION Health Insurance The entire family is insured under Jaylen's company plan, which is a major medical plan with a $500 per person deductible, an 80/20 coinsurance clause, and a family maximum out-of-pocket limit of $5,000. Jaylen's employer pays 90% of the health insurance premium. Life Insurance Jaylen has a group term life insurance policy with a face amount of two times salary provided by Troy Metals, Inc. The policy beneficiary is Avery. The premium of $9 per month is paid by the company. The Section 79 table cost per $1,000 of protection is $0.15 per month for Jaylen's age. The company also pays for dependent life insurance at $2,000 per person. Avery has a group term life insurance policy with a face amount of $50,000 provided by Davis Manufacturing. The policy beneficiary is Jaylen. The premium of $8 per month is paid by the company. The Section 79 table cost per $1,000 of protection is $0.10 per month for Avery's age. Disability Insurance Jaylen has a private disability Income insurance policy with an own-occupation definition of disability and a 30-day elimination period. Based on the policy's provisions, in the event Jaylen is totally disabled, a monthly benefit of $2,700 will be paid until normal retirement age, defined as the full retirement age under the Social Security Act on the date of disability. The annual premium is $761 and is fully paid by Jaylen. Avery has a disability policy through work. The policy pays 50% of salary for 6 months with an own-occupation definition of disability. The waiting period is 5 working days. Premiums for Avery's policy are paid by Davis Manufacturing as an employee benefit. Homeowners Insurance The Jacksons have an HO-5 policy with a dwelling extension and replacement cost on contents. The policy has a $1,000 deductible. The annual premium is $1,500. Coverage A (dwelling) is $280,000 Personal property coverage is $135.000. Personal liability coverage is $100,000 T9e Business Applications 34 Home F9 Fin End Study Facts1.pdf?_ga=2131116813344223453.1629121815-1943489389.160262660 - 110% + 10 Jayler anu Avery ICRSON Jaylen and Avery Jackson have come to you, a financial planner, for help in developing a plan to accomplish their financial goals. You are a Series 7 general securities representative and hold insurance licenses for life and health insurance and variable contracts. The Jacksons have great hope for their future. However, after having a conversation about investing with one of their neighbors, they have recently realized that they are not as financially comfortable as they would like to be at this point in their lives. They began reading about various financial planning services and have decided to consult with you. Assume today is January 1, 2021. PERSONAL BACKGROUND AND INFORMATION The Jacksons Jaylen and Avery have been married for 15 years. They have two children, Ashanti and Blake. Jaylen Jackson (Age 49) Jaylen is the founder and sole stockholder of Troy Metals Inc., a corporation, and has an annual salary of $64,000. Jaylen's health is good. Avery Jackson (Age 49) Avery is an office manager at Davis Manufacturing and has an annual salary of $40,000. Avery's health is excellent They expect their incomes to keep up with inflation Children Ashanti, 14 years old, is in the ninth grade at Brown Road High School, a public school. Ashanti plays soccer in a community league and attends soccer camp in the summer. Ashanti also attends the school's Future STEM Career club. Blake, 9 years old, is in fourth grade at Prairie Hills Elementary School, a public school, Blake meets with a private tutor once a week to get help with reading skills and would like to start taking violin lessons ECONOMIC INFORMATION Currently, the economy is in a recovery phase with decreasing unemployment and increasing economic growth. Inflation and interest rates are currently low. The current GDP has been growing at 3%. There has been a lot of speculation about the Federal Reserve raising interest rates to be better prepared to fight a future recession e Business Applications etirement accounts and education accounts. They assume they will incur 2% in transaction costs The purchase and 6% for the sale. They have asked you the following: A. What will be their payment (principal and interest only) on their new home? B. How much will they be able to invest in their retirement accounts and education accounts after selling the old house and buying the new house? C. If the Jacksons purchase the new house one year from today, what will be the balance on t mortgage when they retire? D. What is the income tax consequence of their sale and purchase strategy? Please show your work for each part of the question. A. 4. Disability Insurance Maximum Points: 10 Jaylen and Avery have asked you to evaluate their current disability insurance coverage. A. What are the cash flow implications if Jaylen were to experience a serious disabling incident before retirement? B. What are the cash flow implications if Avery were to experience a serious disabling incident before retirement? c. What are the tax consequences of receiving disability benefits for Jaylen? D. What are the tax consequences of receiving disability benefits for Avery? INSURANCE INFORMATION Health Insurance The entire family is insured under Jaylen's company plan, which is a major medical plan with a $500 per person deductible, an 80/20 coinsurance clause, and a family maximum out-of-pocket limit of $5,000. Jaylen's employer pays 90% of the health insurance premium. Life Insurance Jaylen has a group term life insurance policy with a face amount of two times salary provided by Troy Metals, Inc. The policy beneficiary is Avery. The premium of $9 per month is paid by the company. The Section 79 table cost per $1,000 of protection is $0.15 per month for Jaylen's age. The company also pays for dependent life insurance at $2,000 per person. Avery has a group term life insurance policy with a face amount of $50,000 provided by Davis Manufacturing. The policy beneficiary is Jaylen. The premium of $8 per month is paid by the company. The Section 79 table cost per $1,000 of protection is $0.10 per month for Avery's age. Disability Insurance Jaylen has a private disability Income insurance policy with an own-occupation definition of disability and a 30-day elimination period. Based on the policy's provisions, in the event Jaylen is totally disabled, a monthly benefit of $2,700 will be paid until normal retirement age, defined as the full retirement age under the Social Security Act on the date of disability. The annual premium is $761 and is fully paid by Jaylen. Avery has a disability policy through work. The policy pays 50% of salary for 6 months with an own-occupation definition of disability. The waiting period is 5 working days. Premiums for Avery's policy are paid by Davis Manufacturing as an employee benefit. Homeowners Insurance The Jacksons have an HO-5 policy with a dwelling extension and replacement cost on contents. The policy has a $1,000 deductible. The annual premium is $1,500. Coverage A (dwelling) is $280,000 Personal property coverage is $135.000. Personal liability coverage is $100,000 T9e Business Applications 34 Home F9 Fin End Study Facts1.pdf?_ga=2131116813344223453.1629121815-1943489389.160262660 - 110% + 10 Jayler anu Avery ICRSON Jaylen and Avery Jackson have come to you, a financial planner, for help in developing a plan to accomplish their financial goals. You are a Series 7 general securities representative and hold insurance licenses for life and health insurance and variable contracts. The Jacksons have great hope for their future. However, after having a conversation about investing with one of their neighbors, they have recently realized that they are not as financially comfortable as they would like to be at this point in their lives. They began reading about various financial planning services and have decided to consult with you. Assume today is January 1, 2021. PERSONAL BACKGROUND AND INFORMATION The Jacksons Jaylen and Avery have been married for 15 years. They have two children, Ashanti and Blake. Jaylen Jackson (Age 49) Jaylen is the founder and sole stockholder of Troy Metals Inc., a corporation, and has an annual salary of $64,000. Jaylen's health is good. Avery Jackson (Age 49) Avery is an office manager at Davis Manufacturing and has an annual salary of $40,000. Avery's health is excellent They expect their incomes to keep up with inflation Children Ashanti, 14 years old, is in the ninth grade at Brown Road High School, a public school. Ashanti plays soccer in a community league and attends soccer camp in the summer. Ashanti also attends the school's Future STEM Career club. Blake, 9 years old, is in fourth grade at Prairie Hills Elementary School, a public school, Blake meets with a private tutor once a week to get help with reading skills and would like to start taking violin lessons ECONOMIC INFORMATION Currently, the economy is in a recovery phase with decreasing unemployment and increasing economic growth. Inflation and interest rates are currently low. The current GDP has been growing at 3%. There has been a lot of speculation about the Federal Reserve raising interest rates to be better prepared to fight a future recession e Business Applications