John Smith is an age 34 male employed at The Big Company earns $90,000 yearly. He is married to

Mary Smith age 30 female employed at The Medical Facility who earns $75,000 yearly.

Mary is currently pregnant with their first child and may/may not take time off from work.

John & Mary bought their first home 1 years ago, paid $500,000 put down 10% and financed the balance in a 30 year fixed mortgage at 3.75%. Their current balance is $440,000 because they were making extra principal payments, but now wonder if they should continue doing this.

John & Mary currently have a joint checking account with $5,000 on a given day.joint savings with $45,000 balance on a given day. The market value of their jointly owned home is now $550,000.

John has $24,000 in his 401k retirement plan at work.

Mary has $22,000 in her 403b retirement plan at work.

Mary owns & drives a 2018 Buick Regal (valued at $18,000) and John owns a drives a 2018 Chevrolet Malibu (valued at $16,000). They do have $6,000 in remaining auto loans with a 3% interest rate.

Together they have only $7,500 remaining balance on their student loans at a 5% interest rate.

They pay off their credit cards in full every month.

Their regular living expenses include: $7,200 in yearly real estate taxes.$800 yearly water & sewer bill$350 per month in groceries.$125 monthly cable & internet.$75 monthly electric bill$3,600 yearly heating bill.car loan payment is $300/monthstudent loan payment is $350/month$150 per month car insurance$125/month homeowners insurance$200 monthly gas for their cars.and $500 monthly fun money.

Remember that we need to allow: 5% MA income tax; 7.65% combined social security & medicare tax; 0.75% MA DFML tax and lets assume a 20% federal income tax (save yourselves the calculations)

Generate a Balance Sheet, Income Statement, and calculate Tax Overhead

Can they afford to have Mary take time off work when the baby arrives? Show work