Financial planning Essay Example | Topics and Well Written Essays - 1500 words

Financial planning - Essay Example The purchase of own residence would require one time down payment for the property. The salaries and the income of the household are mostly spent in the expenses for livelihood and therefore the source of funds is an issue for the couple to purchase the property. The couple is also worried about Vincent’s health as he is prone to heart attack as a hereditary symptom for which the family needs idle funds during emergency. The third on the priority list is to plan for a holiday tour in Europe which is desired by the client. Educational Planning Vincent and Linda are concerned about the high school education of their child Julie who is about 3 years old at present. The couple want to save for their child’s education in about 9 years time for which they wanted to start saving. The issues related to the education planning of their child is that Vincent may lose his job of an accountant due to strategic take-over of his employer by another bigger player in the industry. Also Vincent and Linda are not expecting any further increase in their salaries in the recent years. Thus the financial constraints in financing their child’s education could be serious issue for Vincent and Linda. Investment planning The investment planning of Linda is the next issue that is being faced. While Linda and Vincent are concerned about streamlining her investments, they also have the obligation to meet their monthly instalments payments of various liabilities. This requires sorting out of Linda’s superannuation funds which is currently distributed into three different schemes into one scheme so that the payments and receipts could be properly tracked. Risk Management Vincent and Linda should take into account the risk of repayment of new credit card debt that they have acquired recently. This requires a payment of $5000 on a monthly basis while the actual surplus of the family is $3000 after meeting all expenditures. Thus the client faces the issue of defaultin g on the payment of credit card debt. Financial planner’s assistance to the client The various ways in which the client could be assisted through financial planning in order to address the identified needs are given as follows. Assistance: Home and Health needs In order to address the first three needs against which specific issues have been identified as above, the client should be advised to undertake loans from the banks as well as undertake investment strategies to increase their wealth in order to meet the needs within a period of five years. In order to buy the home, the client could be advised to undertake a loan from the bank for purchase of property. By showing their employment proofs, the client would be able to get the loans. The savings of rental payments which were happening before could be used to accumulate funds for meeting medical emergencies like heart attacks. The accumulated savings could also be used to finance holiday plans as per the priority of the cli ent (Cordell, 1999, p.57). Assistance: Educational needs The educational need of their child is ranked fourth in the priority list of Vincent and Linda’