WHAT DO YOU RECOMMEND? Ace Steven and Florence Szpanka have known each other for a few years and plan to get married the year after next. Ace earns $74,000 annually as a manager in a copper mining plant. He also earns about $20,000 per vear selling jewelry that he designs at craft shows held just about every month in various nearby cities. Soon after they marry, Ace plans to take a year off to go back to college full time to finish the last year of his undergraduate degree. Florence earns $68,000 annually working as an institutional sales representative for an insurance company. Both Ace and Florence each contribute $100 per month to their employer-sponsored 401(k) retirement accounts. Ace has little additional savings, but Florence has accumulated $18,000 that she wants to use for a down payment on a home. Florence also owns 300 shares of stock in an oil company that she inherited six years ago when the price was $90 per share; now the stock is worth $130 per share. Ace and Florence live in a state where the state income tax is 6 percent What wou at Would you recommend to Ace and Florence on the subject of managing 144 PART 2 Money Management WHAT DO YOU RECOMMEND NOW? Now that you have read the chapter on managing income taxes, what advice can you offer Ace and Florence in the case at the beginning of the chapter regarding: 1. Using tax credits to help pay for Ace's college expenses? 2. Determining how much money Florence will realize if she sells the stocks, assum- ing she pays federal income taxes at the 25 percent rate? 3. Buying a home? 4. Increasing contributions to their employer-sponsored retirement plans? 5. Establishing a sideline business for Ace's jewelry operation? Zero Creatives Cultura Jupiter images