Financial Planning Report: FIN3CP, Retirement Planning Analysis

This comprehensive financial report, prepared for the FIN3CP course, analyzes the retirement planning needs of clients Wayne and Karen Brown. It begins with an executive summary, covering personal and financial details, including income, expenses, assets, and liabilities. The report outlines the clients' objectives, which include securing a comfortable retirement, reducing tax liabilities, and generating income through effective investment strategies. It evaluates the clients' risk profile and investment allocation strategies. The analysis includes future projections, strategies for retirement planning, and an amended cash flow statement. Investment suggestions and recommendations are provided, along with details on associated charges and disclaimers. The report focuses on salary sacrifice and investment strategies to optimize retirement income and minimize tax implications. The report also includes sections on risk assessment, investment allocation, and future projections to help clients make informed financial decisions. The objective of the client is to have a safe and secured retired life, reduce the amount of tax that they have to pay and increase their level of income, and undertake effective investment strategies that would reap higher returns.

Running head: FIN3CP
FIN3CFP
Name of the Student:
Name of the University:
Author’s Note:

1
FIN3CP
Table of Contents
Covering Letter................................................................................................................................2
Section 1..........................................................................................................................................4
Section 2..........................................................................................................................................5
Section 3........................................................................................................................................11
Section 4........................................................................................................................................18
Section 5........................................................................................................................................22
Section 6........................................................................................................................................23
Section 7........................................................................................................................................24
Section 8........................................................................................................................................25
Section 9........................................................................................................................................25

2
FIN3CP
Covering Letter
The covering letter includes the personal information of the clients who have been taken into
consideration with respect to the case study.
Personal details
Client 1 Client 2
Title Mr. Mrs.
Surname Brown Brown
Given & preferred
names
Wayne Karen
Home address 10 Equity Street, South Morang Vic 10 Equity Street, South Morang Vic
Business address n.a. n.a
Contact phone n.a n.a
Date of birth 12th May 1959 27th February 1962
Sex  Male Female Male  Female
Smoker Yes  No Yes  No
Expected
retirement age
65 years (30th June 2024) 62 years (30th June 2024)

3
FIN3CP
To Wayne and Karen Brown,
10 Equity Street, South Morang
Victoria
Sub: Covering Letter for the Report
Date: 04/10/2017
Respected Mr and Mrs Brown,
In accordance to the interview that was undertaken earlier in the appointment, there has been a
discussion about the numerous components in accordance to the financial data in order to
construct an efficient retirement planning with the help of the salary sacrificing and the
increasing their level of income without having to pay less tax. In accordance to the meetings
that we had earlier, this paper has been constructed in order to establish a report, within which all
the questions have been answered according to the queries mentioned during the interview.
Kindly have a look into the report and revert in case of any discrepancy and recommendation.
The report has looked to cover up the areas that are in accordance to the effective retirement
planning.
Regards
John Wilson
Financial Consultant

4
FIN3CP
Section 1
Executive Summary
This report has been framed in order to answer the problems that have been discussed by
the client Wayne and Karen Brown who are in the idea of planning an effective retirement
planning process with the help of which the client can attain the highest income without having
to pay huge taxes. The paper has looked to assess the personal details of the client along with the
financial information and statements of the clients. The aim and the objective of the client has
even been mentioned in the report so that an effective plan and idea about the client and the
suitable strategy that would be effective for the client is explained.
The risk profile and the investment allocation strategy of the client is explained so that
the client can have an idea about the effective allocation process and the strategy that can be
useful for them. The body of the report explains the future projections and the strategies that can
be effective enough so that a clear picture about the retirement planning mechanism can be
understood. The benefits and the risks that are associated with the retirement planning of the
client can be assessed by constructing an amended cash flow. The paper even explains the
investment suggestions and the recommendations with respect to the investments of the client
have even been put forth so that the client can have an idea about the same. The charges and the
fees related to the consultation and the preparation of the report has been framed down as well.
The disclaimer and the authority to proceed has been put forward so that each and every aspect
can be understood effectively.

5
FIN3CP
Section 2
Personal Details
Personal details
Client 1 Client 2
Title Mr. Mrs.
Surname Brown Brown
Given & preferred
names
Wayne Karen
Home address 10 Equity Street, South Morang Vic 10 Equity Street, South Morang Vic
Business address n.a. n.a
Contact phone n.a n.a
Date of birth 12th May 1959 27th February 1962
Sex  Male Female Male  Female
Smoker Yes  No Yes  No
Expected
retirement age
65 years (30th June 2024) 62 years (30th June 2024)
Dependants (children or other)
Name Age Sex School Occupation
Brad 20 Male N.A N.A
Cory 18 Female N.A N.A
Amy 15 Female N.A N.A

6
FIN3CP
Employment details
Wayne Brown
Occupation Assistant Manager
Employment status Self-
employed
 Employee Self-
employed
Employee
Not
employed
Pensioner Not
employed
Pensioner
 Permanent Part-time Permanent Part-time
Casual Contractor Casual Contractor
Other Government Other Government
Business status Sole
proprietor
Partnership Sole
proprietor
Partnership
Private
company
Trust Private
company
Trust
Notes

7
FIN3CP
Employment details
Karen Brown
Occupation Nurse
Employment status Self-
employed
 Employee Self-
employed
Employee
Not
employed
Pensioner Not
employed
Pensioner
Permanent Part-time Permanent Part-time
x Part-time Contractor Casual Contractor
Other Government Other Government
Business status Sole
proprietor
Partnership Sole
proprietor
Partnership
Private
company
Trust Private
company
Trust

8
FIN3CP
Notes
Assets and Liabilities as on 01/07/2016
Item Owner
Market
Value
Joint or Owners's Name ($)
Home Joint 700,000
House Contents Joint 100,000
Car Karen 20,000
Total Lifestyle Assets 820,000
Liabilities
Home Mortgage Joint 100,000

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FIN3CP
Investment Assets and Liabilities as on 01/07/2017
Item Wayne Karen Joint
1. Savings Account $0 $0
$18,00
0
2. Term Deposit (maturity dara 1st November 2015) $80,000 $0 $0
3. Share Portfolio
$
60,000 $0 $0
4. Super $425,000
$120,00
0 $0
Total $565,000
$120,00
0
$18,00
0
5. Liabilities $0 $0 $0
Income and Expense Details
Wayne Karen
Salary $122,000 $40,000
Employer Superannuation 10% of base salary
9.5% of base
salary

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FIN3CP
Salary Sacrificing Available None
Savings Account 1%
Term Deposit 2.8 % p.a
Share Income 4% p.a Fully franked
Deductible expenses $3,000 p.a $1,000 p.a
Living Expenses $54,000 p.a
Mortgage payments $18,000
Entertainment and holidays $15,000 p.a
Statement Cash flow for the Year 01 July 2016
Particulars Wayne Karen Total
Income
Salary
$
122,000.00
$
40,000.00
$
162,000.00
Superannuation contribution
$
3,800.00
$
3,800.00
Share Portfolio
$
2,400.00
$
2,400.00
Income from term deposit
$
2,240.00
$
2,240.00
Dividend Income $ -
Total Income
$
126,640.00
$
43,800.00
$
170,440.00
Expenses $ -
Deductible expenses
$
3,000.00
$
1,000.00
$
4,000.00
Entertainment and holiday
$
15,000.00
Total Expenses
$
18,000.00
$
1,000.00
$
19,000.00

11
FIN3CP
Net Income/ Taxable income
$
108,640.00
$
42,800.00
$
151,440.00
Tax Payable
$
27,828.80
$
4,674.00
$
32,502.80
Medicare Levy
$
2,172.80
$
856.00
$
3,028.80
Gross Tax Payable
$
30,001.60
$
5,530.00
$
35,531.60
Franking credit $ - $ -
Net income after tax
$
78,638.40
$
37,270.00
$
115,908.40
Adjustments $ -
Living Expenses
$
54,000.00
$
54,000.00
Mortgage and loan repayment
$
18,000.00
$
18,000.00
Expected Cash Surplus
$
6,638.40
$
37,270.00
$
43,908.40
Objectives
The primary objective of the client has been to construct an effective retirement planning
statement that would be instrumental for the couple to have a safe and secured retired life. The
other objective has been reducing the amount of tax that they have to pay and in a way increase
their level of income. The main aim of the client has been to increase their level of income after
retirement and undertake effective investment strategies that would reap them higher returns.
The couple are nearing the retirement age and therefore wants to pay off their mortgage before
retiring and hence has to prepare a plan that would reap the benefits. They even want to maintain
their lifestyle intact even during prolonged illness and would like to go on annual holidays and
support their children who are attaining the maturity age.