Mr and Mrs Torres are married and are based in Mauritius. In planning their future, they have decided to solicit the services of a well-known financial advisor (you) with the aim of implementing their short and long term lifestyle goals and financial plans. Mr Torres is 45 years old and Mrs Torres is 38 years old. They have one son (age: 12 years).

For their immediate future they have decided to purchase a new apartment in a Smart City in the North of the island and a new car. The apartment they are looking for has a value of Rs 10 million.

The purchase of the apartment will be through a bank loan, if possible. A 25% down payment will be required. They would also like to consider buying a new luxury car for Rs 4 million. However, they are unsure when to buy the car.

Their longer-term plans involve setting up a diversified investment portfolio. Mr Torres believes that he should now invest a lot in real estate to achieve some of their goals. A friend of Mrs Torres furthermore advises them to invest as much as possible in gold. According to him, gold is low risk and that the couple will always make significant gains in the future.

Note that Mr Torres holds the position of Head of Marketing at a large hotel group and he earns Rs 3.5 million gross income annually. Mrs Torres is unemployed. They also enjoy taking holidays and plan to go on a tour of South America in three years time. Estimated cost is Rs 905,000. They are aware of the need to save for their retirement and they are willing to even take on high risk if this assists in them achieving their lifestyle goals faster. They ask you for your views and recommendations on this matter.

They have also managed to save between them around Rs 600,000 in cash and deposits. They are also aware that the current high inflation (now above 8%) may potentially have an impact on their lifestyle going forward. As a result, Mr Torres believes that the couple should take as much insurance as possible, irrespective of the premiums payable. Estimated household expenses are Rs 85,000 per month.

The report /financial plan should include:

Details of any assumptions made on the clients behalf in relation to investment strategies, client background data or any other relevant information other than those provided. You may use Mauritian related data (e.g tax rates, interest rates, etc). Reference to relevant measures announced in the latest Mauritian Budget is strongly encouraged.

Clear advice/recommendations on the goals, observations and investment options/suggestions mentioned in the case study. You should justify your recommendations.

Specific identification of any risks associated with the financial plan and investment advice, possibly including a SWOT (strengths, weaknesses, opportunities, threats) analysis based on the current investment climate.

Students are encouraged to source additional information from the financial press and the internet. All advice provided should be realistic and should be based on real life products, investments, interest rates and economic data.

Relevant calculations, quantitative assessments and research data should ideally be incorporated in your APPENDIX. The report should also be well presented.