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would somebody be able to help me figure out this investment policy statement?Today is March 1 , 2 0 XX and John Jingle has come
would somebody be able to help me figure out this investment policy statement?Today is March XX and John Jingle has come to you to implement an investment policy statement. This is the investment portion of a comprehensive financial plan to accomplish his financial objectives. You have gathered the following information.
Personal and Background Information
John Jingle is years old, single, and does not have any children. He is an architect at a local architecture firm and is very comfortable saving $ per year for retirement. He would like to retire at the age of Taking inflation into consideration you have determined that he needs to save approximately $ for retirement in years to meet his retirement lifestyle objectives. This assumes annual return after taxes, and $ annual savings, and a beginning investment account of $
Financial Information
John began saving for retirement years ago and has saved $ Currently it is invested in his at work and is allocated $ to a balanced fund and $ to a money market fund. He doesn't know what a balanced fund is but his human resources director told him it had both stocks and bonds in the mutual fund. He has noticed that it doesn't decline as much as stocks in a down market, but it doesn't grow as much as stocks do either. This bothers him and he is wondering if he is invested as efficiently as possible to meet his retirement goals. You note that his money market fund has been returning less than annually. He would like you to look at his options and discuss a more suitable investment plan. Assume that your financial advisory firm allows you to give advice on his planning, but ultimately John will need to implement the selections in his employer's k
John and his brother Jack have inherited their mother's estate of $after taxes They both receive $ of the estate. John's portion of the estate is currently invested in individual bonds at a value of $ The bonds pay a semiannual coupon of have a $ par, and are corporate bonds with years remaining. The duration of the bonds is The remaining $ of his portion of the estate is invested in a bank CD paying with a term that ends in a month. He needs help determining what to do with the bonds and the bank CD
John has $ in cash savings. His current expenses are $ a month and you advise that he should have months of expenses on hand for emergency.
He is considering using $ of his inheritance as a down payment to purchase a second home in the mountains. He will finance the remaining portion of the cabin. He would like to purchase this in years. He has concerns about investing that portion of his inheritance in the stock market. He also would like to know how this will impact his retirement goal of retiring with $
John would like to contribute funds to his nephew's education. His nephew will begin college in
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