Two of the three children intend to study at university after they finish high school. Emma and Chris would like to pay the university fees. Only the fees the children will be responsible for meeting their living expenses. For planning purposes, allow AUD75,000 for each child and assume this amount will be allocated in full when each enrolment is confirmed. One child will commence university in four years and the other child will commence university in six years. Discuss the key issues that need to be addressed by Emma and Chris as they consider a savings plan to fund the university fees of their children. As part of your response, estimate the amount of savings required per year required to achieve their objective (assume annual contributions and bank interest on deposits at 5% and clearly state other key assumptions and show calculations).

Emma and Chris 48 and 46 Married, home owners Three teenage children Lawyer and Biochemist AUD250,000 pa (Emma) and AUD145,000 pa (Chris) from salary AUD125,000 pa including the home loan Cash at bank AUD25,000 Superannuation AUD250,000 Home AUD1.5 million Car AUD25,000 Home loan AUD1.0 million Repay home loan within five years Emma and Chris: Emma and Chris have been together for nearly 20 years and have three teenage children. Emma is a partner at a major law firm and Chris is a senior biochemist at a pharmaceuticals company. They both work long hours and hire home help for cleaning and cooking. Family is their top priority and they work hard to ensure that their family and work life is balanced and comfortable. The children are settled and happy at a local state high school. Emma and Chris are concerned that the family home is too small - the teenagers need more space. They are investigating two options sell the home and buy a larger property, or, keep the home and build a major extension. As a hobby, Chris is involved with a group of scientists investigating the development of alternative protein foods that can be manufactured from weed plants. One of these products shows great potential and the group is considering lodging a patent application. The patent process is expensive and Chris's share of the costs will be AUD35,000. But the group has not decided to proceed or not. Both Emma and Chris consider themselves to be risk takers they assess each opportunity on its merits. But they would never place in jeopardy their family or their family wealth