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How to get interest and saving to managed fund? CASE STUDY 3.1 Brooke's Investment Dilemma Brooke has just turned 40 years of age and has
How to get interest and saving to managed fund?
CASE STUDY 3.1 Brooke's Investment Dilemma Brooke has just turned 40 years of age and has been working as an IT professional for fifteen years. She earns $95.000 per year in salary after tax. Brooke came to Australia eight years ago but her immediate family continues to live in the United States. As a result, Brooke had to learn very quickly to look after herself and her financial affairs. Brooke shares a flat with a friend, Janette, and her share of the rent is $250 per week. Brooke's other weekly expenses include: Public transport fares $100 Utility bills $80 Mobile phone $70 Food $250 Clothes $200 Miscellaneous $50 Brooke is always conscious to ensure that she is saving some of her income and has arranged an automatic debit for $200 from her bank account into the United Australian Imputation Fund each month. The amount accumulated in the fund comprises the original $5,000 she was given for her twenty-first birthday to start the fund and contributions and earnings of $8,000, giving a total sum of $18,000. The managed fund is a growth fund with a portfolio of Australian share investments. If Brooke has any money left over, she keeps it in her bank account, which totals $8,000. Brooke is sick of travelling on buses and trains and wants to buy a second-hand car in the next 12 months if she can afford it. If possible, she does not want to use her managed fund, but hopes to save enough ($20,000) to buy the car. Additionally, she would like to purchase a small unit in an inner suburb of Sydney in the next two years, which she estimates would cost her $700,000. She currently has no insurance cover but has a short-term personal loan at an annual interest rate of 12%, the current balance being $15,000 which is required to be paid in full six months from now. In 2020, she would like to take a holiday to see her brothers and sisters in the United States. She estimates she would need $25,000 to undertake this holiday. 3. Prepare an annual cash flow budget for Brooke to assist her in determining whether she has any excess savings capacity. $95.000 4,160 Income Rent Transport Utilities Mobile phone Food Clothes Miscellaneous Interest Savings to managed fund Surplus 13.000 5,200 4.160 3,640 13,000 10,400 2.600 900 2,400 55,300 39,700Step by Step Solution
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