this subject called– Financial Planning Fundamentals. i have to do report 4500 words. i attached task file plz find that
Subject Guide: ACBUS107A – Financial Planning Fundamentals © TAFE NSW – Higher Education Page | 19 Assessment Event 2 – Strategy Discussion Report Weighting: 30 % Learning Outcomes: 3, 4 Graduate Attribute: 1, 5, 7 Due date: Week 10 For this assessment, you are required to extract data from the data collection instrument supplied and analyse the information provided. You are then required to undertake research and analysis on a client scenario, then discuss possible suitable strategies and/or general product/s appropriate to the needs of your client and write a report outlining your analysis and recommendations. Written submissions should be professionally presented using the Report template provided in the Student Moodle and be a minimum of 4,500 and maximum of 5,500 words in length (including Template headings/content). The Strategy Discussion Report template to be used will be provided on Moodle. You are required to overtype some parts of this, remove any instructions and ensure the Report has been individualised for the client’s purposes. Refer to the next page for the specific details and requirements of this assessment task. Subject Guide: ACBUS107A – Financial Planning Fundamentals © TAFE NSW – Higher Education Page | 20 Client Information for Strategy Discussion Report: Trent Darby Introduction You are a para planner at “Sydney Financial Planning Pty Ltd” and the following information is an extract of data gathered as part of the Financial Needs Analysis during an initial client meeting with Trent Darby. The information below is to be used to formulate an appropriate analysis of Trent’s current situation, goals and possible strategies to meet those goals. Your Client The client for this case study is Trent Darby. His concerns centre around not having adequate savings, funds for several goals and general competency in handling his money. Read Trent’ details below. Personal Details Name Trent Darby Gender Male Nationality Australian Date of Birth 03/03/1992 Marital Status In a relationship Address 35/190 – 196 Jubilee Ave, Unanderra, NSW, 2505 Preferred contact 0451123456 Email
[email protected] Private Health Cover Yes Employment Details Employer Wollongong Council Work Status Fulltime Occupation Civil Engineer Income $101,000 p.a. (gross) Dependants Name Date of Birth Age (next birthday) No N/A N/A Liabilities Description Owner Current Value Car Loan Trent $15,000 Finance Loan Trent $10,000 Credit Card debt Trent $ 8,000 Subject Guide: ACBUS107A – Financial Planning Fundamentals © TAFE NSW – Higher Education Page | 21 Assets Description Owner Current Value Home Contents (replacement value) Trent $40,000 Car Trent $25,000 Savings Account Trent $ 1,000 BT Balanced Fund Investment Trent $ 5,000 Loan Details Type Car Loan Finance Loan Credit Card Remaining balance $15,000 $10,000 $8,000 Lender St George GE Virgin Interest Rate 7.49% (fixed) 16.01% (variable) 19.49% (variable) Remaining Term 4yrs 2yrs After 55 day interest free period Repayment Amount $400 monthly $660 monthly Minimum Superannuation Fund Owner Current Value Other Details Local Government Super – Conservative Trent $50,000 Life & TPD cover of $100,000 Perpetual WealthFocus Super - Balanced Trent $40,000 Life & TPD cover of $25,000 Insurance Description Owner Benefit Value Provider Contents Trent $20,000 GIO Comprehensive Car Trent $20,000 GIO Life and Total Permanent Disability As stated above in Superannuation Income Name Trent Salary (gross) $101,000 p.a. Bank interest $10 Dividends (reinvested) $300 Fully Franked Risk Profile Name Risk Tolerance Trent Growth Subject Guide: ACBUS107A – Financial Planning Fundamentals © TAFE NSW – Higher Education Page | 22 Expenses client gave us Expenses Amount pa ($) Rent 13,000 Electricity/Water/Gas 1,130 Telephone/Mobile/Internet 1,250 Insurance – home & contents 800 Insurance – car 1,200 Private Health Insurance 1,100 Petrol/maintenance 4,800 Car registration 1,200 Food 6,200 Grooming/clothes 900 Credit card 15,000 Other loans 14,900 Medical/Dental 1,000 Entertainment/Dinners 2,900 Managed Fund Contributions 1,200 Clubs/Prof. Memberships 1,300 Holidays 3,000 TOTAL $70,880 *Credit card expenditure of $15,000 is in excess of bills/food/clothes etc paid for by credit card but allocated to these expense categories above (i.e. it is totally discretionary) Subject Guide: ACBUS107A – Financial Planning Fundamentals © TAFE NSW – Higher Education Page | 23 Client Objectives What the client hopes to achieve Following the initial discussion with your client, he is seeing your firm to “get a better grip on his finances”. Trent is concerned that while he is on a good salary, he doesn't seem to have much to show for it and wonders where his money goes each month. He has heard that he should really have a cash reserve of around $10,000 as an emergency fund and thinks this is a good idea. He also wants to propose to his girlfriend in about 6 months with an engagement ring that he estimates will cost him about $5,000. They would like to have saved enough for a deposit on a unit in 5 years and he thinks he will need to replace his car at around that point as well. He’s also wondering if his superannuation set up is a good one and he’s heard that he could save tax if he “salary sacrificed” into his fund. Assessment Task: The Assessment involves compiling the answers/workings from the questions in the Background Research (not assessable) to complete the Strategy Discussion Report (assessable). Please DO NOT submit your workings/answers – the only submission is to be the Strategy Discussion Report. BACKGROUND RESEARCH This part is NOT Assessable but is required for input into the Strategy Discussion Report: 1. From the meeting with your client, was there any missing information or goals that you would like more detail on that you would need to clarify? 2. What issues do you believe you should discuss with your client? Include other goals or risks you may identify, if they are not listed in the case study. 3. Identify, set and prioritise your client’s S.M.A.R.T goals and objectives. Include the goals you have identified and list whether they are short, medium or long term goals. 4. What goals are there that you may identify (or the client has stated) that you may suggest the client address at a later stage (when their more urgent goals are met)? 5. Calculate client’s annual after-tax income (include Medicare levy). Use current financial year tax rates. (This will be done in class in the relevant topic week – make sure you attend or obtain this information) 6. a. Using the excel spreadsheet provided in the Moodle, prepare a Current Cash Flow Analysis and Net Worth Statement for your client to determine what the current income surplus/deficit is and net worth position. (This will be done in class in the relevant topic week – make sure you attend or obtain this information). b. Prepare a Cash Flow Analysis for the next 5 years and Net worth Statement at the end of that 5 years. In preparing this forward analysis, assume your discussions with client result in him being prepared to follow a budget limiting his discretionary credit card spending. Redo client’s Cash Flow Analysis planning for him to stick to a credit card spend of $700 per month, determining a new surplus/deficit amount. Subject Guide: ACBUS107A – Financial Planning Fundamentals © TAFE NSW – Higher Education Page | 24 7. Using the Life Insurance Calculator (on Moodle), how much Life Insurance (Life, TPD and Income Protection) does client ideally need? (This will be done in class in the relevant topic week – make sure you attend or obtain this information) 8. What suitable outcomes (strategies) can you match to the goals you have identified and prioritised, utilising any surplus identified? 9. Prepare a table comparing the 2 superannuation funds the client has and identify a preferred fund. STRATEGY DISCUSSION REPORT This part is Assessable and utilises the Background Research: 1. Construct a Strategy Discussion Report for the client using: the template provided (on Moodle) and “Strategy Discussion Report - Checklist” (on next page) and 2. Under the appropriate sections in the Strategy Discussion Report template, use the relevant answers from your Background Research and discuss options and strategies the client could consider to meet their goals. You can combine goals if the possible strategies link to multiple goals. 3. Research the clients 2 super funds to determine which one the client should retain and explain why. Show your analysis in the appropriate section of the Strategy