Jill and Jack are both 25 years old graduated in May 2018 with a BBA in General Business. They were hired by a nonprofit organization and have decided to start saving to make the 20% down payment on a two-bedroom, two-bathroom apartment in Harrison, NJ, in five years. Jill called you to schedule an appointment because they will benefit from meeting with a Certified Financial Planner to discuss their finances. During the call, she told you they are currently making $65,000 each per year, and the apartment they would like to buy is currently selling for $389,000. Their monthly rent and renters insurance cost $1,975 (including utilities) and $16 per month, respectively. Their auto insurance costs $82, and auto maintenance costs are estimated to be $275 per month. The couple spends $4,272 in transportation (gas and public transportation), $3,552 ($1,776 each) in healthcare, $10,272 in food, and $18,000 in miscellaneous expenses per year. They have $42,150 and $39,750 in outstanding student loans with an average interest rate of 5.05%, whose $6,460.37 is due within one year. They are not planning to have kids or get back to school for a graduate degree before buying a home. Their employer makes a 3% contribution to their 403(b) if they contribute at least 6% of their salaries, as Jill and Jack are doing. Their employer also provides a life insurance policy with a face value equal to their annual salary without any cost. Jill and Jack anticipated federal tax obligations are $5,973 and $6,006 per year, respectively. Social Security and Medicare contributions are $4,972.50, also per year. The couple has $926 in their checking account and $5,982 in their 403(b) account, invested in a mutual fund that replicates the S&P 500 composition. They don't have any credit card balance outstanding but financed the purchase of a $30,050 Honda CRV last June at 2.0% per year. The auto loan has an outstanding balance of $28,685 (with $2,770 being due within one year), and the car has an estimated market value of $27,000 today. General prices are expected to increase 3.0% in the next five years. Jill and Jack have a moderate tolerance to risk and a required rate of return of 8.5%. And 30-year (15-year) conforming mortgage rates are expected to be around 4.75% (4.50%). Please, write a report to be presented to Jill and Jack, including the following items. You need to address all the questions but present your answer in a professional report to your clients. Please, remember that this is not an exam. Therefore, you should not present questions followed by answers. But you should divide your report into sections with short titles 

What is your assessment of Jill and Jack's current risks? What would you recommend for risks the couple will probably face in the future. What type of insurance(s) do they currently have? What other insurance would you recommend? 

Should Jill and Jack be worried about retirement plans now? What are they currently doing to make sure that they will retire comfortably? What should they do in the future? What are the assets and cash flows they may rely on when they retire? 

Jill and Jack don't have kids now. But they may decide to have them in the future. And they certainly care about each other. What should the couple do to protect and benefit those they care about if one of them passes away? What legal instruments do they need to put in place? Explain why these instruments are important.