You are working as a financial advisor for an investment company. You have been asked to write a policy statement for Mr. Richards, your new client. He is a 30-year old entry-level manager at a reputed retail company named Solar, Inc. He is expecting a promotion soon. He married four years ago and has a three-year old child. He expects to have another child in about few months. His salary is $60,000 per year. He wants to retire at the age of 60. It is expected that his salary will increase about 5% per year on average. His current bank balance is $65,000. Mr. Richards wife works as a Cashier at a local fast food chain and makes $18,000 per year. Mr. Richards is thinking about investing in such a way so that they (husband and wife) are able to have enough to retire comfortably. He and his family members have good health as well as life insurance. He bought a house five years ago. He has been paying a monthly installment of $1,500 per month for his house. He has 12 more years to pay for his outstanding loan of the house. His other monthly expenses are approximately $2,500 per month. Assume that the current income tax rate is 30%. Expected inflation rate is about 2.50% annually. Historical nominal returns from equity, bond and T-bills are 13%, 7%, and 4%, respectively. He has a passion for travelling and hunting. Mr. Richards wants to send his children to a top class business school, which now costs about $70,000 per year. He also has a plan to give a gift of $200,000 (after retirement) to his undergraduate institutions where he studied seven years ago. Assume that Mr. Richards (and the family) has slightly above-average risk tolerance. You may also assume if you think any important information is missing above (such as investment horizon!). In that case, please write those assumptions at the beginning of the policy statement. Based on the available information, write a nice policy statement for your client. You must mention how you should advise to invest across various asset classes and reasons (risk attitude and expected return). You will show how his goals will be met by providing future stream of cash flows. Also, do not forget to mention how to evaluate portfolio performance and appropriate benchmark. Look at the slides to know the contents of a policy statement.