They graduated from college four years ago and they have good jobs, but none of them has paid any attention to their finances.

Amanda has $28,000 in student loans charging an APR of 7% but Carlos, who is a Navy veteran, was able to use his GI bill to pay for his nursing school tuition.

Amanda works for a marketing firm and is making $76,000 a year.

Carlos works as a registered nurse and is making $90,000 a year. The hospital has offered him a promotion to become a charge nurse, with increased responsibilities to oversee the floor or unit, and comes with a 15% salary increase. He has not accepted the offer yet, as he's concerned about the tax implications of the raise.

Amanda's marketing firm is small and offers no retirement benefits, whereas Carlos has a defined benefit pension plan through the hospital.

Amanda and Carlos have a three-year old child, and do not have life or disability insurance in place. They don't have a will either.

They have a total of $40,000 in their checking and savings accounts. They have this cash available for emergencies as well as a down payment for a home.

The couple has begun working with a realtor to find a home, and estimate they can afford a $500,000 home.

Based on their current financial situation (including the promotion and salary increase being offered to Carlos), explain to the couple what their tax bracket as a married couple filing jointly looks like BEFORE and AFTER the promotion (if Carlos accepts in 2022). Note: the couple does not understand how tax brackets work, which is why Carlos is hesitant to accept the promotion.

Then explain two (2) tax planning strategies you would recommend to Amanda and Carlos to reduce their taxes, by explaining what the strategies are and why the couple would benefit from these strategies (e.g. how it will save them money).

Amanda and Carlos do not have disability insurance.

Explain to the couple, the purpose of disability insurance and why the benefits of having it.

Amanda and Carlos do not have any life insurance.

Explain to the couple, the purpose of life insurance and the different types they can choose from (Term vs Whole).