For the next 10 problems please use the following story problem below to come up with 10 suggestions or tips to share. Worth 8 pts each. Please enter just one tip or suggestion for each problem.

Mike and Betty are each 35 years old and have just had twins. All 4 are in great health. Mike and Betty each earn $80,000/year. Money is a bit tight now with the new babies. They have a home and a 15-year mortgage with a 5% interest rate. Mike has short term disability and Betty has elected one of the disability insurance options offered by the company - any occupation disability coverage for up to $4,500/month. Mike has a $750,000 whole life policy for $300/month. Betty has the company insurance for 2 times salary. In the hope of retiring early, they are paying an extra $300/month on their mortgage and investing what they can in their 401(k)’s. They currently each invest $3,000/yr. into the 401(k) and invest 50% of their accounts into the Asia fund and 50% into inflation-protected bonds because they believe that Asia will be strong next year and that inflation will be on the rise. While they wish they could save more, they each have a company pension and contribute to social security. Mike’s parents are in their late 70’s and his dad is in a nursing home. He is learning first hand that the financial and emotional costs of aging can be tough, so Mike and Betty are considering purchasing long term care right now to protect themselves in the future.

They have just visited a ‘financial planner’ but have asked you for a second opinion. The ‘planner’ prepared retirement projections for Mike and Betty and informed them they were not initially on track to meet their retirement goal. In order to make their projections work, the planner lowered their life expectancy from 90 to 80. With these changes, Mike and Betty are now on pace to begin retirement at age 63. The ‘planner’ suggests that they each begin drawing Social Security at age 62 so that they can collect for as many years as possible. The fund options in their 401(k) are not funds that the ‘planner’ regularly uses so he advised them not to use the 401(k) plans at this time. Many of the fund choices were index funds. The planner has advised them to shift all of their future savings from 401(k)’s to Roth IRAs instead for their retirement savings because they expect retirement to cost much less than their current expenditures and the ‘planner’ does not want them to be burdened by taxes during retirement. He expects they can average a 10% rate of return over the next 45 years. To help them meet their goals, the ‘planner’ has offered all the initial work for free.

Based on the facts in the story of Mike and Betty, list 10 tips/questions/discussion topics/suggestions you have for Mike and Betty. Be specific. You have not been given all the facts about Mike and Betty so I am not expecting your answers to be detailed recommendations. Insightful comments or questions will be sufficient. (Example – if your answer was “review life insurance” – you would receive no credit. If instead you answered “Discuss Betty’s life insurance; she appears to be underinsured” – you would receive full credit.)