Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Patricia and Greg Williams, both aged 67, have recently retired. In considering their retirement plans, Williams have decided to do an audit on their current

Patricia and Greg Williams, both aged 67, have recently retired. In considering their retirement plans, Williams have decided to do an audit on their current financial situation. On 1 July 2019, they both purchased lifetime annuities for $60,000 each. These provide a $6,000 pension each per annum. In addition, they held the following assets as at 1 July 2020: Home $750,000 Mortgage on home $100,000 Prepaid funeral $50,000 Term deposit at 5% $330,000 Managed fund $80,000 Direct shares $60,000 Rental property $350,000 Motor vehicles $40,000 Antiques $50,000 Jewellery $45,000 On 1 August 2020, the Williams decided to give $100,000 (i.e., $50,000 to each of their two children) to help them with the purchase of their first homes. Greg has decided to take a part-time job with his local art dealer and expects to earn $100 per week. The Williams have come to see you for advice on 3 August 2020. How are the lifetime annuities treated for the pension asset and income mean tests?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Dividend Policy On Share Price Volatility In Indian Stock Market

Authors: Vijay Deswal

1st Edition

3841859623, 978-3841859624

More Books

Students also viewed these Finance questions

Question

Explain all drawbacks of application procedure.

Answered: 1 week ago

Question

Explain the testing process of accounting 2?

Answered: 1 week ago