Individual Financial Planning for Peter and Lisa Clarke

This report provides individual financial planning recommendations and suggestions to Peter and Lisa Clarke based on their current financial situation, objectives, and risk profile. The report covers areas such as insurance, superannuation, cash flow planning, investment planning, and estate planning. The report also includes their personal details, dependents, assets and liabilities, income, expenses, and existing insurance policies.

Running head: INDIVIDUAL FINANCIAL PLANNING
Individual Financial Planning
Name of the Student:
Name of the University:
Author’s Note:

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Table of Contents
Covering Letter................................................................................................................................3
Executive Summary.........................................................................................................................5
Introduction......................................................................................................................................5
Current Position...............................................................................................................................6
Personal Details...............................................................................................................................6
Dependents......................................................................................................................................7
Assets and Liabilities.......................................................................................................................8
Income.............................................................................................................................................9
Expenses........................................................................................................................................10
Existing Insurance.........................................................................................................................10
Objectives......................................................................................................................................11
Risk Profile and Asset Allocation..................................................................................................13
Risk Profile and Asset Allocation..................................................................................................13
Recommended Financial Strategy.................................................................................................18
Recommended Investment Strategy..............................................................................................19
Implementation..............................................................................................................................20
Disclosures.....................................................................................................................................21
Disclaimer......................................................................................................................................21
Bibliography..................................................................................................................................23

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Covering Letter
To Peter and Lisa Clarke
Address: 25 Ashington Dr Warners Bay NSW 2282
Dear Peter and Lisa,
I am highly grateful that you have given me the privilege to serve you with your financial
consultations and therefore accepting my offering to come to this face to face meeting so that I
would be able to give out effective suggestions with respect to your financial activities. the
recommendations that would be provided to you would be on the basis on the information that
you have given me and I am sure that these suggestions would be helpful for your future life.
The information that I would provide would be helpful to you in undertaking future investments
so that you can earn effective level of returns and income from the investments. This would
enhance your life and secure life post retirement.
The responses you have given through the Fact Finder and the questions related to the risk
profile has been of great help as I have been able to attain greater level of knowledge through the
same with respect to your present objectives and goals and the present condition and your notion
towards risks, income returns, security and volatility.
The suggestions and the outcomes that would be collected can be utilised in order to construct
your Statement of Advice. This document will be a record that can be used for the purpose of
suggestions even in the future course of time in order to attain your goals and objectives that is
even inclusive of the interests and the fees that are related to the advice.

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If there are any changes in the lifestyle with the transformation of time, then advices can be
provided in the future as well which would be useful in maintaining a secured and safe lifestyle.
Hence, I am looking forward to come to your assistance with other suggestions and consultation
with respect to the plans and strategies in order to provide you extensive and sustainable
services. All the suggestions and the advices that will be provided to you will be based on the
ASIC guidelines.
Regards
Malcolm Starc
Signature
Financial Consultant

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Executive Summary
The summary provides an overview that would be helpful to the client in understanding
the recommendations and the suggestions that would be given out to them. The overview is
actually the present condition, the objectives and the aims and the plans and guidelines that
would be recommended in order to assist the client to attain their future objectives and goals.
The best result can be given with the incorporation of the strategies. The client would be
requiring knowledge and therefore by reading the executive summary, they would be able to
attain better knowledge about the suggestions that have been given out to them and thereby able
to understand whether aims and goals have been reached. There is sufficient data which would
assist the client to take effective decisions by looking at the risks that they may undergo. The
fees and the charges that are related to SOA are even reported. The data that has been provided
to them will be written in a clear and lucid language with the unavailability of expressions and
therefore is ideal to their degree of the financial knowledge.
Introduction
The introduction of the paper would address the client about the aspects that would be
covered in the SOA and accordingly the advices and the suggestions that would be provided to
them on the basis of their plans and objectives in order to help the clients reach their financial
milestones. The SOA would cover the areas like the insurance, superannuation, cash flow
planning, investment planning and estate planning for the couple. The advices would even
include the other non-financial aims and objectives of the couple that would include the securing
their life even after retirement and assisting their dependent children to undergo college and
support them till they become independent. The clients would be made aware of the risks and the

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challenges they would face with respect to these issues and thereby assisting them to create
contingency and a buffer in order to mitigate these risks in an effective manner.
Current Position
By analysing the current scenario of the couple, it is seen that Peter and Lisa are married
and have their own house and have two dependent children who are aged 15 years and 12 years
respectively Peter works full time and on the other hand Lisa works part time. They both have
superannuation contribution. The couple have two properties out of which they reside in one of
them and the other property has been used for investment purposes and therefore they receive a
rent out of it. Both these properties have existent mortgages and they have the intension of
paying off the mortgages before they start their retirement life. The couple are near their
retirement age and therefore they are seeking for advices related to making additional
investments and along with that make changes in their existing investments so as to receive the
best results of their investments. The money that Peter has received from his uncle’s inheritance
would even be used for the purpose of investment and in such a manner that they receive
effective level of returns without even having to pay for excess taxes. Their living expenses are
moderate and therefore are not concerned with the money they are receiving from their
superannuation account.
Personal Details
Client 1 Client 2
Title Mrs Mr
Surname Clarke Clarke
Given Name Lisa Peter (Pete)

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Salutation Mrs Mr
Home Address 25 Ashington Dr
Warners Bay NSW 2282
25 Ashington Dr
Warners Bay NSW 2282
Business Address Not applicable Not applicable
Contact Phone [phone] (02) 4958 7598
Marital Status Married Married
Age 41 43
Health Minor back injuries but otherwise good Good
Employment
Status
Employed (part-time) Employed (full-time)
Occupation Civil Engineer (degree-qualified) Business Services Accountant
Employer KR Engineers Mindful Professional Services
Sex Male X Female X Male Female
Smoker X Yes No Yes X No
Anticipated
Retirement
Would like to retire at a similar time to
Peter (around age 63)
Ideally retire at approximately age
65.
Dependents
Name Dependant Age Dependent Until
Ashlee Clarke Daughter 15 Age 22
Cameron Clarke Son 12 Age 22

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Assets and Liabilities
Asset Value Liability Ownership Notes
Principle Residence
(Warners Bay
property)
$963,000 $220,000 Joint Purchased property ten years ago
with initial mortgage of $700,000.
Mortgage principle & interest rate of
3.63%. Peter and Lisa are making
minimum mortgage repayments.
Mortgage Offset $150,000 $0 Joint Lisa is concerned if this is the best
use of these funds that accumulated
over the last few years.
Vanguard ETF $37,500 $0 Peter Australian shares ETF.
Investment Property
(Wallsend)
$450,000 $268,000 Joint Minimum mortgage repayments.
Interest rate 3.5%.
Home Contents $65,000 $0 Joint Estimated value.
Motor Vehicles $35,000 $0 Joint No finance, 2013 Mazda 3 (Pete)
and 2016 Holden Barina (Lisa).
Uncle’s Inheritance
(Funds available for
investment)
$250,000 $0 Peter Peter’s uncle recently passed away
recently. Pete would like to invest
these funds.
Bank Accounts
(Cash on hand)
$42,000 $0 Joint Westpac bank accounts.
Australian Super
Account
$319,875 $0 Peter Invested in pre-mix Balanced option
AMP Super Account $225,656 $0 Lisa Invested in pre-mix Conservative
asset allocation, largely invested in
cash. Admin fees are very high $300
p.a.

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REST Super Account $15,663 $0 Lisa Lisa is not sure what this is invested
in and has not made contributions to
this account since she was working
in retail while she was at uni.
CBA Credit Card $0 $15,342 Peter Peter makes minimum repayments.
Interest rate 18%. $50,000 limit.
CBA Credit Card $0 $0 Lisa Balance repaid in full monthly.
Income
Income Value Frequency Ownership Notes
Salary (Part-time) $145,000 Annual Lisa Lisa receives this for working 4
days/ week.
Salary (Full-time) $130,000 Annual Peter Peter is comfortable in his current
job.
Dividends (Est at 4%
p.a.)
$1,500 Annual Peter Vanguard dividends.
Rental Income $400 Weekly Joint Wallsend rental property income.
Interest (Est at 2% p.a.) $736 Monthly Joint Interest on all cash investments.

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Expenses
Expense Value Frequency Ownership Notes
Living Expenses $105,000 Annual Joint Including mortgage repayments on
both properties.
Charitable Donations $6,000 Annual Peter Peter makes a monthly $500
donation to the Salvation Army.
Existing Insurance
Policy Benefit Life
Insured
Owner Notes
Linked Life & TPD $650,000 Lisa AMP Super Default with AMP super account.
Any occupation TPD.
Standalone Life $500,000 Peter Australian
Super
Default Australian super.
Standalone TPD $350,000 Peter Australian
Super
Own occupation TPD.
Income Protection $6,500/
month
Peter Australian
Super
Payable to age 60; 90 day wait.
Statement of Cash flow
Particulars Peter Lisa Total
Income
Salary $ 130,000 $ 145,000 $ 275,000
Rental Income $ 19,200
Interest $ 8,832

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Dividend Income $1500
$ 1500
-
Total Income $ 131,500 $ 145,000 $ 304,532
Expenses $ -
Living expenses $ 105,000
Charitable Donations $6,000
Total Expenses $ 193,532
Net Income/ Taxable income $ 131,500 $ 145,000 $ 193,532
Tax Payable
$
39,559.63
$
43,259.63
$
82,819.26
Gross Tax Payable
$
39,559.63
$
43,259.63
$
82,819.26
Franking credit $ - $ -
Net income after tax
$
91,940.37
$
101740.37
$
110,712.74
Objectives
The couple have the intention of creating long term income creation by taking assistance
of which they would have a safe and secured lifestyle for their future and thereafter would not
have to think about their level of income once they retire. Risk is looked upon to be one of the
essential factors and therefore the couple are searching for investments that would yield the
returns they are looking for but would risk level would be moderate. The couple before they plan
to retire would look to pay off their existing mortgages for their two properties and accordingly
wants to sell the property that is given out on rent in Wallsend. They are even in the idea of
wealth creation with the help of which they would be able to generate money during their time of
retirement that would be equivalent to $60,000 to the current dollar value. The client even has
the idea of reducing their level of taxes wherever deemed possible. They want to continue the
donations that they undertake and for that to happen they require a stable return from their
income. The couple even wants to pay for the college fees for their children and accordingly
wants to attain significant amount of money with the help of which they would be able to pay for

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the same. The clients do not require additional investments in the superannuation or any other
kind of estate planning but if the current superannuation investment is not adequate they are
happy to make changes from the current investment to any other superannuation accounts.
The objectives have been segmented into short, medium and long term and they have been listed
as follows:
Short Term
 Minimise the level of tax wherever possible
 Make sustainable donations to the charity
Medium Term
 To pay off the mortgage that is currently existent for the two properties that are existent
 Purchase sufficient amount of insurances in order to financially remunerate them in case
of sickness and accidents
Long Term
 Accumulate certain amount of wealth that would be useful in giving out returns in the
future worth $60,000 of the current dollar value
 To pay for the educational fees for their children till they become independent
 Maintain adequate money during the time of retirement in order to maintain the current
lifestyle even after retirement
 Ensure that all their desires are fulfilled once they expire

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Risk Profile and Asset Allocation
This part would look to assess the investment allocation and the risk profile plans for the
client. The demand of the client is to pay off their existing debts. The couple even wants to
generate adequate amount of money with the help of which they would be able to generate
sufficient amount of returns in order to maintain their current lifestyle even after retirement. The
couple wants to maintain adequate money after their retirement and even wants to attain
significant amount of returns with the help of which they would be able to pay for the expenses
that is related to the educational activities of their children.
Risk Profile and Asset Allocation
The risk profile of the client can be understood with the help of the risk profile
questionnaire and addressing the same by the client would be helpful in creating a better risk and
asset allocation for the future.

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After the assessment of the risk profile of the client, it can be determined that they are in
the notion of receiving balanced risk portfolio and therefore their investments should be made in
such a manner that there would be a equivalency among the investments in the equities and even
in the debts. In this manner, the couple would be able to gain proper returns and the extent of tax
payment would be the lowest. The couple are in the idea that maintenance of a balanced portfolio
would lead to the attainment of the long to medium term objectives and hence is in need of an
investment strategy, which would be able to stand up with the effects that can occur due to
changes in taxes and inflations. The couple are eager to undertake risks that are calculative in
order to gain suitable returns. The couple wants to create a capital development and returns with
respect to the investment time frame after they pay out their existing expenditures. The effective
investment allocation for the couple has been given as follows:
Asset Class Allocation Percentage
International Equities 20%
Australian Equities 23%
Australian Bonds 24%
Property 4%
Fixed Income 20%
Cash 9%
Total 100%

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Recommended Financial Strategy
There are several suggestions that can be given out to the couple and they are as follows:
The primary objective of the couple is to enhance their level of savings and income in
order to have a sustainable life after retirement and reduce the level of tax payment. The present
financial scenario, suggests that the current investments that they have would be able to maintain
their present lifestyle even after retirement.
By assessing the information related to superannuation of the client, it is seen that
estimated superannuation balance account during the time of retirement are based on their
present scenario. The superannuation account balance would be able to generate sufficient
returns when the client reaches their retirement age. It is advisable that they concentrate on this
without further postponements by implementing this advice.
It is advisable that Peter and Lisa move ahead with the present superannuation account
balance because of the fact that evaluation of the same has discovered that it would be able to
reach their income that are looking for even after their retirement. Therefore, the additional
money that has been received from the inheritance from Peter’s uncle can be used for the
purpose of additional investments and this money can be invested by taking additional risk so
that better returns can be attained.
The couple should purchase a savings plan as they would be receiving additional income
and thereby would receive additional cash returns which would act as a buffer in case of any
unprecedented events. The maintenance of the cash barrier is an effective strategy in order to
maintain the current lifestyle of the couple and even able to take care of any sort of
unprecedented events and scenarios.

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The couple are even advised to create process with the help of which they would be able
to analyse their existing insurances after the successful incorporation of the investment portfolio
approach. The couple are even advised to purchase additional health insurance covers in order to
eliminate the risks related to their health. It is seen that the funds can have certain limitations like
the tax implications and limited access over it during the lock in period of the invested capital.
Recommended Investment Strategy
There are several products that can be recommended to the client for making additional
investments with the help of the money that is attained from the inheritance from Peter’s uncle.
This money can be used to purchase a health insurance cover for both Peter and Lisa and the
money that would be left can be invested in a balanced product in order to attain effective returns
with the lower level of risks. It is seen that the existing insurances of the couple are sufficient in
order to handle any financial losses due to accidents but the purchase of a health insurance cover
would be helpful in remunerating the financial loss due to sickness. The product that is
recommended is “Russell Investments Diversified 50 Fund Class A”. The features of the product
have been given as follows:
“Russell Investments Diversified 50 Fund Class A”
Establishment fee Nil
Contribution fee Nil
Withdrawal fee Nil
Termination fee Nil
Management cost for the investment 0.79 p.a

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For every $5,000 invested, $0 will be charged.
“PLUS Management costs: 0.79% p.a.” and for each investment of “$50,000” in the
Fund, a fee charge of “$395” each year will be levied.
The total cost for the couple will be dependent on the charges that will be negotiated with the
financial consultant.
 Managed actively, multi-asset solutions
 Quality Product
 Effective Incorporation
The investment goal of the fund associates to the development of the estimated returns
with lower level of risks.
Implementation
The couple needs to incorporate these recommendations in order to enhance their level of
income and returns even after retirement and Peter and Lisa requires further advices from the
financial advisers on a frequent basis in order to make improvements in their existing
investments with respect to the changing time and risks in the market. The couple even needs to
undertake payment for the ongoing services so that effective level of returns can be attained from
their respective investment portfolio.

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Disclosures
This involves all the relevant documents that are related to advise that are given to the
clients and thereby the client would have extensive understanding of all the advices and the
documents that are related to them.
Disclaimer
The report disclaimer addresses that the advices that have been provided to Peter and Lisa
needs to be reviewed and evaluated on a timely manner because these investments can create
extensive losses due to internal and external factors. Therefore, this is a caution that the
recommendations given may turn out to be unsuccessful due to the change of events. The
financial adviser would not be liable for any circumstances and thus effective monitoring needs
to be done in the investment market prior to implementing the investments. It is even suggested
to go through the “offer documents” of the products before purchasing the investment.
Authority to Proceed
By signing this authority to proceed, I/we Peter and Lisa acknowledge the following:
 “I/We acknowledge that the data I/we have provided in the financial needs assessment
has been used to arrive at the recommendations contained in this SOA”.
 “I/We have read, understood and retained a copy of the SOA prepared by Mr John
Wilson dated 18/04/2018. This document contains information which accurately
summarises my/our current situation, investments and financial objectives”.
 “I/We have been provided with a Financial Planning FSG”.
 “I/We have read and understood the PDSs for the recommended products”.

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 “Please note that a cooling-off period may apply to your initial investment or
insurance policy. Refer to the PDS”.
 “I/We acknowledge that the product(s) listed in the table below are to be
implemented in my/our name/s:”
 “I/We wish to make the following change/s to the recommendations within the SOA”

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Bibliography
Falconier, M. K. (2015). Together–A couples’ program to improve communication, coping, and
financial management skills: Development and initial pilot‐testing. Journal of marital and
family therapy, 41(2), 236-250.
Tilahun, T., Coene, G., Temmerman, M., & Degomme, O. (2015). Couple based family planning
education: changes in male involvement and contraceptive use among married couples in
Jimma Zone, Ethiopia. BMC Public Health, 15(1), 682.