Read the case on attachments.

Then make a financial plan for dan and Laura using the 6 parts of the plan (Establish scope of activity, Gather data and identify goals, Compile and analyze data, Develop solutions and present plan, Implement and Monitor and review).

Please write the plan in paragraph format using six paragraphs, one for each part of the process.

Back to Dan and Laura The following case study is developed throughout the book with the relevant material pre- sented at the end of each chapter. Both the facts and interpretation of each meeting are presented through the eyes of the financial planner doing the advising. BACKGROUND FIRST INTERVIEW Dan and Laura, who became my clients in January 2015, came into my office. They brought along their new baby son, Brian. Laura mentioned that because Brian was so young she was reluctant to leave him in anyone else's care. A discussion about Brian seemed to help both Dan and Laura unwind. We then proceeded to talk about both of their backgrounds. Laura, 35, grew up in a comfortable middle-class neighborhood, the only child of an owner of a successful sporting goods store. She was raised in a home in the suburbs and had all the comforts she wanted. She went to a private, all-women's college where she majored in English. She took a position as a public school teacher when she graduated. She is currently on maternity leave of absence arising from Brian's birth and is unsure when she will return to work. I noticed that Laura's body language seemed relaxed and natural. Even though her baby started to cry from time to time, she maintained her participation in the proceedings. In contrast to Laura, Dan still did not seem to be completely engaged. His face seemed strained, his eyes half closed when he spoke, and his arms were folded. I decided to turn my attention to him. Dan, 35, is one of four children. His mother and father both immigrated to this country. Household finances were very tight. Both parents worked, and Dan's father often had two low- paying jobs. Dan remembers the time that his Dad was laid off and they were almost forced to take a smaller apartment in which Dan would have slept in the living room with his brother. Despite that trouble, Dan described his family life as happy and himself as always having been a "worrier" when it came to money. Dan worked part-time as a teenager and went to a state university where he borrowed the entire sum for room and tuition. He studied computer science in college and is currently working as a systems engineer for a computer service company. His job involves above-average risk because he works for a firm on a multiyear project but could be terminated after it is over. On the other hand, he is well compensated for his efforts. In fact, the immediate reason that Dan and Laura came to see me was that they had $20,000 in credit card debt. They had accumulated this debt as the result of higher household expenses and a desire not to touch their marketable investments. They wanted to eradicate the debt as soon as possible. I made a mental note that the debt seemed inconsistent with Dan's worries about money but decided not to discuss this until later. I told them that I would create a debt repayment plan, but first I wanted to collect some data on their accumulated assets, other liabilities, and goals. The fact that Dan was able to discuss his background and his concern about his debt and that I treated the problem in a matter-of-fact way seemed to lift his spirits. He became more relaxed, turned directly to the table, and even smiled once or twice. The couple had accumulated about $10,000 in pension assets, $31,000 in money market funds, $103,000 in stocks and stock funds, and had $2,800 in a checking account. More broadly speaking, they had $3,000 in current assets and $147,000 in marketable invest- ments. They owned two used cars worth $6,000 each. Their furniture and fixtures were valued at $7,000. Dan had a stamp collection worth about $1,000, and Laura had jewelry worth $4.000. In addition to $20,000 in credit card debt, they had a total of $46,000 in student loans and $20,000 in loans from parents. Next we turned to the couple's goals. Their most immediate goal was to lift the pres- sure created by their debt. They believed that their current lifestyle was fine and saw no need to raise it. They wanted to have one more child. As Laura said, she always felt lonely as an only child, and Dan liked having siblings. She thought that Brian would want one too. She and Dan believed their current two-bedroom apartment was sufficient for one child but wanted to own their own home. They wanted their insurance checked for adequacy. They were placing money in retirement savings accounts but felt that it wasn't diversified properly. Dan and Laura had ambitious retirement goals. They wanted to be financially indepen- dent by age 55. In retirement they wanted to maintain their current lifestyle and thought their costs would stay the same as when they were working. In addition, they wanted each child to be left $100,000 in inflation-adjusted terms. Finally, their objective was a plan that laid out their goals, indicated whether they were realistic, and, if so, would provide guidance in achieving them. I explained to them that they had basically described the function and scope of a finan- cial plan. I indicated that the recommendations would reflect their goals and what I believed should be their focus. Laura mentioned that given her preoccupation with her baby, she would prefer frequent meetings by topic rather than in-depth interviews. I gave them a questionnaire to help them focus and to obtain further financial information. The goals, time frame, and cost were set. At just that moment, Brian started to cry loudly and the first meeting was over. I decided to prepare each section of the financial plan discussed after each meeting, I decided to prepare each section of the financial plan discussed after each meeting, and I told them I would send a draft subsequent to the session for them to examine. I rec- ognized that parts of the plan would have to be revised once the total costs of their goals were compared with current and future cash inflows. The introduction to financial plan- ning could be completed right now. This is how I introduced Dan and Laura to financial planning: Personal financial planning is the process of supervising your financial activities so that you can meet the goals you have set out. In order to accomplish those goals, it is helpful to con- struct a financial plan. This document will consider your goals overall, compare them with your current and future resources, and establish a plan for attaining them. In addition to 18 Part One Planning Basics outlining your goals and current assets, the plan consists of the following active areas: cash flow planning, tax planning, investments, risk management, retirement planning, estate planning, educational planning, employee benefits planning, and special circumstances planning, sometimes incorporated in other sections for all else that is financially relevant. Let me explain the financial planning process I would perform for you. After our pre- liminary interview we will have established the scope of the activities to be completed. In your case, as mentioned, it is a full financial plan. Based on that engagement, we will gather the data and identify goals. I would have already provided you a copy of my ques- tionnaire to supplement the data gathered in our face-to-face meeting. After that process is completed, we will accumulate and analyze the data. It will be comprehensive, encompassing all major parts of the plan as already indicated and any oth- ers we decide are important. At that point we will develop solutions, which will be inte- grated, meaning they will combine all parts of the plan, giving you what we arrive at as the best use of your money. Given your preference, each part will be discussed separately. Nonetheless, we will have a completed financial plan presentation at the end of the process and a meeting to go over the plan. Planning does not end there. The plan will have to be reviewed and updated periodically. We will construct your financial plan with your goals in mind. As indicated, we will discuss each part of the plan separately and I will develop each. I will explain why I make my recommendations in enough detail so that you can provide me your reactions prior to the final inteoration stage for completing the nlan We are off to a onod start and I look