University Finance Report: Retirement and Estate Planning Analysis
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This report provides a detailed financial analysis and planning strategy for retirement and estate management. It includes a cash flow statement, accumulation of income from shares and rent, and superannuation account analysis for a couple. The report assesses the current financial situation, including income, expenses, and investments. It offers recommendations for improving financial well-being, such as superannuation strategies, non-superannuation strategies, and estate planning. The report projects cash flow, evaluates investment portfolios, and emphasizes the importance of personal insurance and regular portfolio reviews. The analysis considers inflation, tax implications, and the couple's financial goals to provide actionable advice for securing their retirement and estate plans.

Running head: RETIREMENT AND ESTATE PLANNING
Retirement and Estate Planning
Name of the Student:
Name of the University:
Author’s Note:
Retirement and Estate Planning
Name of the Student:
Name of the University:
Author’s Note:
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1
RETIREMENT AND ESTATE PLANNING
Covering Letter
To Mark and Susan Saunders
48, Mayo Street
Melbourne
Sub: Covering Letter for the Report
Date: 21/09/2017
Respected Mr and Mrs Saunders,
In view of the interview we had earlier during our appointment, we had undergone interactions
regarding the various aspects with respect to the financial information in order to establish an
effective retirement planning investment portfolio. In line with the discussions we had
previously, the underline paper consists of the report in which every question has been answered
in view to the answers desired. Please have a go through it and feel free to revert in case any
doubt arises.
The report has tried to cover every aspect in lieu of the retirement planning.
Regards
Malcolm Johnson
Financial Consultant
RETIREMENT AND ESTATE PLANNING
Covering Letter
To Mark and Susan Saunders
48, Mayo Street
Melbourne
Sub: Covering Letter for the Report
Date: 21/09/2017
Respected Mr and Mrs Saunders,
In view of the interview we had earlier during our appointment, we had undergone interactions
regarding the various aspects with respect to the financial information in order to establish an
effective retirement planning investment portfolio. In line with the discussions we had
previously, the underline paper consists of the report in which every question has been answered
in view to the answers desired. Please have a go through it and feel free to revert in case any
doubt arises.
The report has tried to cover every aspect in lieu of the retirement planning.
Regards
Malcolm Johnson
Financial Consultant

2
RETIREMENT AND ESTATE PLANNING
Table of Contents
Answer to Question No 1................................................................................................................3
Answer to 1 (i).............................................................................................................................3
Answer to 1 (ii)............................................................................................................................4
Answer to 1 (iii)...........................................................................................................................8
Answer to 1 (iv)...........................................................................................................................9
Answer to 1 (v)..........................................................................................................................12
Answer to Question No 2..............................................................................................................13
Bibliography..................................................................................................................................19
RETIREMENT AND ESTATE PLANNING
Table of Contents
Answer to Question No 1................................................................................................................3
Answer to 1 (i).............................................................................................................................3
Answer to 1 (ii)............................................................................................................................4
Answer to 1 (iii)...........................................................................................................................8
Answer to 1 (iv)...........................................................................................................................9
Answer to 1 (v)..........................................................................................................................12
Answer to Question No 2..............................................................................................................13
Bibliography..................................................................................................................................19
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3
RETIREMENT AND ESTATE PLANNING
Answer to Question No 1
Answer to 1 (i)
Statement Cash flow for the Year 30 June 2017
Particulars Mark Susan Total
Income
Salary
$
32,000.00
$
32,000.00
Superannuation contribution
$
3,200.00
$
3,200.00
Net Income from Business
$
125,000.00
$
125,000.00
Income from term deposit
$
1,000.00
$
1,000.00
Dividend Income
$
4,000.00
$
4,000.00
Total Income
$
125,000.00
$
40,200.00
$
165,200.00
Expenses $ -
Work related expenses
$
700.00
$
700.00
Donation
$
100.00
$
120.00
$
220.00
Total Expenses
$
100.00
$
820.00
$
920.00
Net Income/ Taxable income
$
124,900.00
$
39,380.00
$
164,280.00
Tax Payable
$
33,845.00
$
4,024.20
$
37,869.20
Medicare Levy
$
2,498.00
$
787.60
$
3,285.60
Gross Tax Payable
$
36,343.00
$
4,811.80
$
41,154.80
Franking credit
$
1,200.00
$
1,200.00
Net income after tax
$
88,557.00
$
33,368.20
$
121,925.20
Adjustments $ -
Living Expenses
$
45,400.00
$
14,600.00
$
60,000.00
Mortgage and loan repayment
$
29,888.00
$
9,612.00
$
39,500.00
Expected Cash Surplus $ $ $
RETIREMENT AND ESTATE PLANNING
Answer to Question No 1
Answer to 1 (i)
Statement Cash flow for the Year 30 June 2017
Particulars Mark Susan Total
Income
Salary
$
32,000.00
$
32,000.00
Superannuation contribution
$
3,200.00
$
3,200.00
Net Income from Business
$
125,000.00
$
125,000.00
Income from term deposit
$
1,000.00
$
1,000.00
Dividend Income
$
4,000.00
$
4,000.00
Total Income
$
125,000.00
$
40,200.00
$
165,200.00
Expenses $ -
Work related expenses
$
700.00
$
700.00
Donation
$
100.00
$
120.00
$
220.00
Total Expenses
$
100.00
$
820.00
$
920.00
Net Income/ Taxable income
$
124,900.00
$
39,380.00
$
164,280.00
Tax Payable
$
33,845.00
$
4,024.20
$
37,869.20
Medicare Levy
$
2,498.00
$
787.60
$
3,285.60
Gross Tax Payable
$
36,343.00
$
4,811.80
$
41,154.80
Franking credit
$
1,200.00
$
1,200.00
Net income after tax
$
88,557.00
$
33,368.20
$
121,925.20
Adjustments $ -
Living Expenses
$
45,400.00
$
14,600.00
$
60,000.00
Mortgage and loan repayment
$
29,888.00
$
9,612.00
$
39,500.00
Expected Cash Surplus $ $ $
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4
RETIREMENT AND ESTATE PLANNING
13,269.00 9,156.20 22,425.20
Answer to 1 (ii)
Statement Showing Accumulation of Income from shares
Ye
ar
Opening Balance Growth Accumulated closing Value
201
7
$
100,000.00
$
6,000.00
$
106,000.00
201
8
$
106,000.00
$
6,360.00
$
112,360.00
201
9
$
112,360.00
$
6,741.60
$
119,101.60
202
0
$
119,101.60
$
7,146.10
$
126,247.70
202
1
$
126,247.70
$
7,574.86
$
133,822.56
202
2
$
133,822.56
$
8,029.35
$
141,851.91
202
3
$
141,851.91
$
8,511.11
$
150,363.03
202
4
$
150,363.03
$
9,021.78
$
159,384.81
202
5
$
159,384.81
$
9,563.09
$
168,947.90
202 $ $ $
RETIREMENT AND ESTATE PLANNING
13,269.00 9,156.20 22,425.20
Answer to 1 (ii)
Statement Showing Accumulation of Income from shares
Ye
ar
Opening Balance Growth Accumulated closing Value
201
7
$
100,000.00
$
6,000.00
$
106,000.00
201
8
$
106,000.00
$
6,360.00
$
112,360.00
201
9
$
112,360.00
$
6,741.60
$
119,101.60
202
0
$
119,101.60
$
7,146.10
$
126,247.70
202
1
$
126,247.70
$
7,574.86
$
133,822.56
202
2
$
133,822.56
$
8,029.35
$
141,851.91
202
3
$
141,851.91
$
8,511.11
$
150,363.03
202
4
$
150,363.03
$
9,021.78
$
159,384.81
202
5
$
159,384.81
$
9,563.09
$
168,947.90
202 $ $ $

5
RETIREMENT AND ESTATE PLANNING
6 168,947.90 10,136.87 179,084.77
202
7
$
179,084.77
$
10,745.09
$
189,829.86
202
8
$
189,829.86
$
11,389.79
$
201,219.65
202
9
$
201,219.65
$
12,073.18
$
213,292.83
203
0
$
213,292.83
$
12,797.57
$
226,090.40
Statement showing accumulated Income From rent
Yea
r value of Property Rental Income
2017 $ 320,000.00 $ 16,000.00
2018 $ 332,800.00 $ 16,640.00
2019 $ 346,112.00 $ 17,305.60
2020 $ 359,956.48 $ 17,997.82
2021 $ 374,354.74 $ 18,717.74
2022 $ 389,328.93 $ 19,466.45
2023 $ 404,902.09 $ 20,245.10
2024 $ 421,098.17 $ 21,054.91
2025 $ 437,942.10 $ 21,897.10
2026 $ 455,459.78 $ 22,772.99
2027 $ 473,678.17 $ 23,683.91
Mark
Statement showing Accumulation and income in Superannuation Account
Ye
ar
S&M SMSF AMP Super Fund Return
201 $ $ $
RETIREMENT AND ESTATE PLANNING
6 168,947.90 10,136.87 179,084.77
202
7
$
179,084.77
$
10,745.09
$
189,829.86
202
8
$
189,829.86
$
11,389.79
$
201,219.65
202
9
$
201,219.65
$
12,073.18
$
213,292.83
203
0
$
213,292.83
$
12,797.57
$
226,090.40
Statement showing accumulated Income From rent
Yea
r value of Property Rental Income
2017 $ 320,000.00 $ 16,000.00
2018 $ 332,800.00 $ 16,640.00
2019 $ 346,112.00 $ 17,305.60
2020 $ 359,956.48 $ 17,997.82
2021 $ 374,354.74 $ 18,717.74
2022 $ 389,328.93 $ 19,466.45
2023 $ 404,902.09 $ 20,245.10
2024 $ 421,098.17 $ 21,054.91
2025 $ 437,942.10 $ 21,897.10
2026 $ 455,459.78 $ 22,772.99
2027 $ 473,678.17 $ 23,683.91
Mark
Statement showing Accumulation and income in Superannuation Account
Ye
ar
S&M SMSF AMP Super Fund Return
201 $ $ $
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6
RETIREMENT AND ESTATE PLANNING
7 40,000.00 20,000.00 3,520.00
201
8
$
41,200.00
$
20,600.00
$
3,625.60
201
9
$
42,436.00
$
21,218.00
$
3,734.37
202
0
$
43,709.08
$
21,854.54
$
3,846.40
202
1
$
45,020.35
$
22,510.18
$
3,961.79
202
2
$
46,370.96
$
23,185.48
$
4,080.64
202
3
$
47,762.09
$
23,881.05
$
4,203.06
202
4
$
49,194.95
$
24,597.48
$
4,329.16
202
5
$
50,670.80
$
25,335.40
$
4,459.03
202
6
$
52,190.93
$
26,095.46
$
4,592.80
202
7
$
53,756.66
$
26,878.33
$
4,730.59
Susan
Statement showing Accumulation and income in Superannuation Account
Ye S&M SMSF Australian Catholic Super Return
RETIREMENT AND ESTATE PLANNING
7 40,000.00 20,000.00 3,520.00
201
8
$
41,200.00
$
20,600.00
$
3,625.60
201
9
$
42,436.00
$
21,218.00
$
3,734.37
202
0
$
43,709.08
$
21,854.54
$
3,846.40
202
1
$
45,020.35
$
22,510.18
$
3,961.79
202
2
$
46,370.96
$
23,185.48
$
4,080.64
202
3
$
47,762.09
$
23,881.05
$
4,203.06
202
4
$
49,194.95
$
24,597.48
$
4,329.16
202
5
$
50,670.80
$
25,335.40
$
4,459.03
202
6
$
52,190.93
$
26,095.46
$
4,592.80
202
7
$
53,756.66
$
26,878.33
$
4,730.59
Susan
Statement showing Accumulation and income in Superannuation Account
Ye S&M SMSF Australian Catholic Super Return
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7
RETIREMENT AND ESTATE PLANNING
ar Fund
201
7
$
20,000.00
$
90,000.00
$
5,140.00
201
8
$
21,600.00
$
91,600.00
$
5,316.00
201
9
$
84,100.00
$
154,100.00
$
12,191.00
202
0
$
84,600.00
$
154,600.00
$
12,246.00
202
1
$
86,600.00
$
156,600.00
$
12,466.00
202
2
$
169,200.00
$
239,200.00
$
21,552.00
202
3
$
169,200.00
$
239,200.00
$
21,552.00
202
4
$
169,550.00
$
239,550.00
$
21,590.50
202
5
$
169,660.00
$
239,660.00
$
21,602.60
202
6
$
170,120.00
$
240,120.00
$
21,653.20
202
7
$
252,260.00
$
322,260.00
$
30,688.60
202
8
$
271,194.60
$
341,194.60
$
32,771.41
RETIREMENT AND ESTATE PLANNING
ar Fund
201
7
$
20,000.00
$
90,000.00
$
5,140.00
201
8
$
21,600.00
$
91,600.00
$
5,316.00
201
9
$
84,100.00
$
154,100.00
$
12,191.00
202
0
$
84,600.00
$
154,600.00
$
12,246.00
202
1
$
86,600.00
$
156,600.00
$
12,466.00
202
2
$
169,200.00
$
239,200.00
$
21,552.00
202
3
$
169,200.00
$
239,200.00
$
21,552.00
202
4
$
169,550.00
$
239,550.00
$
21,590.50
202
5
$
169,660.00
$
239,660.00
$
21,602.60
202
6
$
170,120.00
$
240,120.00
$
21,653.20
202
7
$
252,260.00
$
322,260.00
$
30,688.60
202
8
$
271,194.60
$
341,194.60
$
32,771.41

8
RETIREMENT AND ESTATE PLANNING
202
9
$
272,837.40
$
342,837.40
$
32,952.11
203
0
$
293,414.80
$
363,414.80
$
35,215.63
The assumptions that have been undertaken for the computation of the data has been that
net profit from business, salary and all expenditure will grow by the CPI each year. The plant
and equipment is a depreciating asset and therefore can be assumed that it will have no value
when the business is sold The couple has private health insurance financial assumptions to be
used like making use of the current tax rates (2016) Inflation: 3.0% per annum, and all the rates
have been calculated on the basis of actual figures.
Answer to 1 (iii)
Name of investment Owner Cash
Fixed
interest
Propert
y
Australian
shares
Internationa
l shares Total
Australia share portfolio Susan 100,000
100,00
0
Bank acccount Joint 35,000 35,000
S&M SMSF Mark 18000 12000 0 10,000 0 40000
Susan 9000 6,000 0 5000 0 20000
AMP Super Fund Mark 2000 4,000 4000 6000 4000 20000
Australia Catholic
Super Fund Susan 18000 27000 13500 18000 13500 90000
Total of asset class in $
terms 82000 49000 17500 139,000 17500 305000
RETIREMENT AND ESTATE PLANNING
202
9
$
272,837.40
$
342,837.40
$
32,952.11
203
0
$
293,414.80
$
363,414.80
$
35,215.63
The assumptions that have been undertaken for the computation of the data has been that
net profit from business, salary and all expenditure will grow by the CPI each year. The plant
and equipment is a depreciating asset and therefore can be assumed that it will have no value
when the business is sold The couple has private health insurance financial assumptions to be
used like making use of the current tax rates (2016) Inflation: 3.0% per annum, and all the rates
have been calculated on the basis of actual figures.
Answer to 1 (iii)
Name of investment Owner Cash
Fixed
interest
Propert
y
Australian
shares
Internationa
l shares Total
Australia share portfolio Susan 100,000
100,00
0
Bank acccount Joint 35,000 35,000
S&M SMSF Mark 18000 12000 0 10,000 0 40000
Susan 9000 6,000 0 5000 0 20000
AMP Super Fund Mark 2000 4,000 4000 6000 4000 20000
Australia Catholic
Super Fund Susan 18000 27000 13500 18000 13500 90000
Total of asset class in $
terms 82000 49000 17500 139,000 17500 305000
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RETIREMENT AND ESTATE PLANNING
Total of asset class in %
terms 37.1% 22.2% 7.9% 62.9% 7.9%
The above table represents the returns from the share portfolio of Mark and Susan.
By observing the computations and taking help of various tools it can be determined that
if the couple has a fixed retirement income of $39, 275, then the balance of the superannuation
can sustain for them up to the age of 90 years for each one of them.
Answer to 1 (iv)
There are various strategies and recommendations that can be given out to the mark and
Susan in order to improve their lifestyle and level of income even after their retirement. They are
s given as follows:
Superannuation strategy:
RETIREMENT AND ESTATE PLANNING
Total of asset class in %
terms 37.1% 22.2% 7.9% 62.9% 7.9%
The above table represents the returns from the share portfolio of Mark and Susan.
By observing the computations and taking help of various tools it can be determined that
if the couple has a fixed retirement income of $39, 275, then the balance of the superannuation
can sustain for them up to the age of 90 years for each one of them.
Answer to 1 (iv)
There are various strategies and recommendations that can be given out to the mark and
Susan in order to improve their lifestyle and level of income even after their retirement. They are
s given as follows:
Superannuation strategy:
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10
RETIREMENT AND ESTATE PLANNING
As the couple are planning to retire they will have to pay extra tax if they withdraws
more than $195,000 in the 2016-17 financial year from the taxable component of their super
before-tax contributions. By distributing the contributions among the two they can construct their
super and both can withdraw up to $195,000 tax free. Any withdrawals above $195,000 are taxed
at 15%. The 2% Medicare Levy may also apply.
Non-superannuation strategy:
The taxable element of a benefit may be liable for taxation depending on whether the
coupe take their benefit before or after the age of 60, or, in the event of their death, when they
leave their benefits to a ‘non-dependant’ with respect to the tax laws.
Estate planning:
In accordance to the house that they possess, the couple wants to pay off the mortgage
before they retire and in order to do so they should keep an amount out of their annual income
for the payment of mortgage and should calculate the amount that can be paid before they retire
in order to close the mortgage and thereby pay the desired amount in order to close the mortgage
before retirement.
Personal insurance:
They are not in the idea of examining their insurance. The main objective of the couple is
to increase their savings for the intention of retirement and to achieve an income of $39,275 per
month by minimising the level of tax once they reach retirement. Their present scenario reveals
that if they sustain as their present situation, they will be not be able to meet their goal and hence
requires implementing the strategies in order to obtain $39,275 per month for their maintenance
of their current lifestyle even after their retirement.
RETIREMENT AND ESTATE PLANNING
As the couple are planning to retire they will have to pay extra tax if they withdraws
more than $195,000 in the 2016-17 financial year from the taxable component of their super
before-tax contributions. By distributing the contributions among the two they can construct their
super and both can withdraw up to $195,000 tax free. Any withdrawals above $195,000 are taxed
at 15%. The 2% Medicare Levy may also apply.
Non-superannuation strategy:
The taxable element of a benefit may be liable for taxation depending on whether the
coupe take their benefit before or after the age of 60, or, in the event of their death, when they
leave their benefits to a ‘non-dependant’ with respect to the tax laws.
Estate planning:
In accordance to the house that they possess, the couple wants to pay off the mortgage
before they retire and in order to do so they should keep an amount out of their annual income
for the payment of mortgage and should calculate the amount that can be paid before they retire
in order to close the mortgage and thereby pay the desired amount in order to close the mortgage
before retirement.
Personal insurance:
They are not in the idea of examining their insurance. The main objective of the couple is
to increase their savings for the intention of retirement and to achieve an income of $39,275 per
month by minimising the level of tax once they reach retirement. Their present scenario reveals
that if they sustain as their present situation, they will be not be able to meet their goal and hence
requires implementing the strategies in order to obtain $39,275 per month for their maintenance
of their current lifestyle even after their retirement.

11
RETIREMENT AND ESTATE PLANNING
From the information provided, it is evident that their estimated superannuation account
balances at retirement are based on their present scenario. This superannuation account balance
would be able to generate sufficient amount of returns when the couple reach their retirement
age. It is recommended that they concentrate on this without delay by undertaking this
recommendation.
It is recommended Mark and Susan that they both sustain their existing superannuation
funds because the investigation indicates that they offer various fees for consultation, however it
is suggested that they modify their options for investment to be more in line with their risk
profile that has been recognised.
If they still remain in their current asset allocation, along with the added investment into
superannuation they would be unable to accomplish their desired income after retirement. It is
thus sensible for them to undertake a slightly higher degree of risk than they have at this time
undertaken in order to have a better possibility of attaining their objectives.
As they will still have a increased surplus income, it is suggested that they should
undertake savings plan into a high income earning cash account to build up a buffer for
unprecedented events. It is recommended to keep a cash buffer and it is recommended as a
strategy that the couple with debt and investment property maintain a buffer in case of
unforeseen operating expenses that may arise, or rising interest rates on loans. It has been
estimated that that they will need $39,275 per month for their living up to the age of 90 years and
an earnings of 3% per annum net of inflation.
It is suggested to construct a strategy to review their insurances once they have
incorporated the strategies within their investment portfolio. Without undertaking this,
RETIREMENT AND ESTATE PLANNING
From the information provided, it is evident that their estimated superannuation account
balances at retirement are based on their present scenario. This superannuation account balance
would be able to generate sufficient amount of returns when the couple reach their retirement
age. It is recommended that they concentrate on this without delay by undertaking this
recommendation.
It is recommended Mark and Susan that they both sustain their existing superannuation
funds because the investigation indicates that they offer various fees for consultation, however it
is suggested that they modify their options for investment to be more in line with their risk
profile that has been recognised.
If they still remain in their current asset allocation, along with the added investment into
superannuation they would be unable to accomplish their desired income after retirement. It is
thus sensible for them to undertake a slightly higher degree of risk than they have at this time
undertaken in order to have a better possibility of attaining their objectives.
As they will still have a increased surplus income, it is suggested that they should
undertake savings plan into a high income earning cash account to build up a buffer for
unprecedented events. It is recommended to keep a cash buffer and it is recommended as a
strategy that the couple with debt and investment property maintain a buffer in case of
unforeseen operating expenses that may arise, or rising interest rates on loans. It has been
estimated that that they will need $39,275 per month for their living up to the age of 90 years and
an earnings of 3% per annum net of inflation.
It is suggested to construct a strategy to review their insurances once they have
incorporated the strategies within their investment portfolio. Without undertaking this,
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