Steve Miller ( 45 ) and Brenda Miller ( 45 ) are a married couple with two children Adam 12 and daughter Amy 8 ) . Steve is self - employed electrical contractor and earns $ 125,000 after expenses yearly . He has been running his business as a sole proprietor for over 10 years . He has not incorporated his business due to the hassle if additional regulatory requirements and expenses involved . His business has really taken off during the last three years and he sometimes feel the need to hire more employees to assist him .
Brenda just completed her 18 years working as a Legal assistant at one of the leading Law firm and eams $ 68,000 . The law firm provides her all benefit including a group life insurance plan for 3 times her salary . She also has a defined contribution plan at work in which the firm matches a dollar for a dollar to maximum contribution of $ 3,000 per year by the employer . She has been contributing $ 200 every month ever since she joined , and the employer matches the same amount . Her funds are invested in a Bond Fund and has a current value $ 85.000 . She has an accumulated contribution room of $ 66,000 .

They have a house in Mississauga in their joint names that they purchased 10 years earlier for $ 600,000 and is currently valued at about $ 900,000 . They have been making extra payments to their $ 250,000 mortgage and hope to pay it off in nine years . Brenda is always worried about the mortgage and would like to be mortgage free as soon as possible . Brenda inherited a cottage from her parents that is currently valued at $ 275,000 and is mortgage free . They spend about 6,000 annually to carry the cottage in taxes and maintenance etc. They have so far been spending 4-5 weekends every year at the cottage and enjoy their time . Ideally , Brenda would like their son Adam to inherit the cottage and have been considering adding him as a joint owner . However , she is not sure if it is a good idea because she wants to be fair to both her children .
Their major cash outflows apart from the mortgage payment of $ 2,800 per month include property tax $ 340 home insurance $ 120 maintenance $ 300 utilities $ 250 groceries $ 900 ; clothing $ 400 ; Steve's life insurance $ 160 ( Face Value $ 300,000 ) ; Intemet and phone $ 150 ; entertainment / dining $ 900 ; donations , gifts $ 100 miscellaneous discretionary $ 800 Vehicles gas and car insurance $ 660 Car loan payment $ 940 per month . Steve currently leases his truck for a monthly payment of $ 640 and Brenda has a Volkswagen sedan financed by a loan with a current balance of $ 25,000 at interest rate of 5.5 % and she is paying $ 300 per month . Each year , they spend $ 7,200 on vacation . Steve has credit card balance of $ 23,000 that he incurred when he purchased a new tool set for his business for which he is paying $ 450 per month . Brenda has a current credit card balance of $ 12,000 . They also have a $ 40,000 joint unsecured line of credit from their bank with current balance of $ 8,000 .
Each February Steve purchases $ 12,000 of mutual funds via a lump sum contribution to his Registered Retirement Savings Plan ( RRSP ) . The mutual funds include the following : $ 12,261 in broad - based Canadian equities , $ 10,675 in Canadian energy companies , $ 21,024 in U.S. large cap stocks . $ 5.734 in interational equities across multiple continents , and $ 14,016 in Canadian goverment bonds . His RRSP account has grown to $ 63,710 and he currently 84.000 in unused RRSP contribution room . Steve has never contributed to a Tax - Free Savings Account ( TFSA ) . When he switched banks almost a decade ago Aaron set up a pre - authorized monthly transfer of $ 250 from his chequing account to his savings account to cover emergencies that may arise . This account has grown to $ 34,000 .
Steve as a Universal Life Insurance policy with a Face Value of $ 300,000 that he purchased when he was very young . Current Cash Surrender Value ( CSV ) of the policy is $ 28,000 . He has an athletic body and is very active and rarely had any medical issue . He never felt the necessity to obtain disability insurance . Brenda has a group Life insurance policy at work for a face value of 3 times her salary . There is however no disability insurance from employment , and she has also never felt the need to obtain Disability insurance . They sometimes wonder if their insurance coverage is adequate and how could they know their needs for insurance .
They both would like to retire in at age 65. At that time , they estimate that they will need $ 6,000 per month to maintain their lifestyle because their house will be mortgage free . They are both in excellent health and expect to live to age 90. They are worried about their retirement and want to know if they would have sufficient funds upon retirement to maintain their lifestyle .

Steve's parents gifted $ 11,000 each to their children on their 50th wedding anniversary 5 years ago , that was invested in GIC yielding annual interest rate if 2.5 % maturing next month . They believe that the cost of post secondary education for each child would be $ 50,000 . They will prefer that their children do not have to resort to student loans . They would like to find ways to have adequate funds for the post - secondary education of their children .

1.Construct a current net worth statement Do the clients have a positive net worth and sufficient liquid assets for emergencies . Prepare a cash flow statement for the clients How can the positive cash flow be optimally utilized , or negative cash flow eliminated ? Review their current personal debt structure and make recommendation to optimise debts

2.Conduct Insurance Needs Analysis and review adequacy of current insurance coverage Recommend insurance planning steps with justification

3. Review current investments of the client . Are the investments aligned to their KYC ? (Time Horizon Risk Tolerance and Investment Objectives ). How are the current investments diversified among 3 asset classes , cash , fixed income and equities . What changes would you recommend and why ? Assuming a reasonable rate of return on their investments , how much their investments would be worth at the time of retirement ?