You provide financial advice to a client (2) Show the calculations to convince the client (3) Use information provided by the client, make reasonable assumptions for the rest of the inputs (4)...

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You provide financial advice to a client (2) Show the calculations to convince the client (3) Use information provided by the client, make reasonable assumptions for the rest of the inputs (4) Irrespective of client’s goals, also give the client a along-term perspective (such as when to retire, how much money to have at retirement, how much income to save for retirement or rainy day, …) (5) In addition to client’s goals, make other suggestions if they make sense to you.Client 1: Lisa Simpson Lisa, 23, has a BA degree with a specialization in finance Works full time, lives in Tallinn, did not accumulate any savings yet She just started to work as financial analyst with a 2000 EUR per month before taxes in compensation Lisa is not sure but expects her salary to grow at least by 10% per year before MBA Lisa has two financial goals (1) as soon as possible to accumulate EUR 10 000 in savings for a rainy day (2) save as much as possible for executive MBA in finance from one of the world top-3 Business Schools before age of 33 Lisa expects to change countries where she lives and does not want to take mortgage because she assumes that transaction costs will be to high. Lisa expects to save 30% of her income. Help Lisa decide what to do with her savings to achieve both goals and do not make major mistakes in the meantime (such as forgetting about retirement savings). How much Lisa should expect to borrow for her MBA?



Money, financial institutions and markets Group Project Guidelines There are three hypothetical clients on the next slides. Chose any one out of these three clients. ___________ (1) You provide financial advice to a client (2) Show the calculations to convince the client (3) Use information provided by the client, make reasonable assumptions for the rest of the inputs (4) Irrespective of client’s goals, also give the client a along-term perspective (such as when to retire, how much money to have at retirement, how much income to save for retirement or rainy day, …) (5) In addition to client’s goals, make other suggestions if they make sense to you ___________ Submit a presentation file to the corresponding folder (bottom of the course Moodle page) Clearly state members of your groups in the submitted file Submit one file for the whole group (so, if you have 4 members, make just one submission) Submit by March 28th, late submission have a penalty of 1% (out of 100%) of the grade per day Format of the presentation is for you to decide, formatting and/or design does not affect the grade. Client 1: Lisa Simpson Lisa, 23, has a BA degree with a specialization in finance Works full time, lives in Tallinn, did not accumulate any savings yet She just started to work as financial analyst with a 2000 EUR per month before taxes in compensation Lisa is not sure but expects her salary to grow at least by 10% per year before MBA Lisa has two financial goals (1) as soon as possible to accumulate EUR 10 000 in savings for a rainy day (2) save as much as possible for executive MBA in finance from one of the world top-3 Business Schools before age of 33 Lisa expects to change countries where she lives and does not want to take mortgage because she assumes that transaction costs will be to high. Lisa expects to save 30% of her income. Help Lisa decide what to do with her savings to achieve both goals and do not make major mistakes in the meantime (such as forgetting about retirement savings). How much Lisa should expect to borrow for her MBA? Client 2: Bart Simpson Bart, 23, has a BA degree with a specialization in finance Working full time, lives in Tallinn He just started to work as financial consultant with a 1600 EUR per month before taxes in compensation Bart expects his salary to grow at least by 15% per year for the next 10 years Bart has two financial goals (1) to buy an apartment that costs about EUR 250 000 (2) make sure that moorage payment does not exceed 20% of his monthly income and that his mortgage is fully repaid before his 50th birthday Bart expects to save not more than 25% of his income. Help Bart to figure out when he can afford to buy the apartment and what to do with his savings before and after he buys the apartment. Keep in mind that Bart also needs to save something for rainy day and retirement. Client 3: Peter and Lois Griffin Peter and Lois, both 40, live in Tallinn, and have three kids of 15, 12, and 3 years old They have a family business yielding EUR 5000 after tax, profit grows by 2% per year Exactly 10 years ago they took a 30 years EUR 250 000 mortgage at 6% fixed rate So far, Peter and Lois accumulated EUR 100 000 in total savings Peter and Lois have the following financial goals: (1) Have EUR 1 400 000 by age 70 (2) Be able to pay a mortgage down payment in the amount of 30% of the apartment value for each of their kids when they reach the age of 25 Peter and Lois prefer to save as little as possible. They also have an opportunity to refinance their mortgage for 30 years at 4% fixed rate. However, a mortgage refinancing fee is 3% of the amount of refinancing. Help Peter and Lois to decide how much they should save out their monthly income to achieve their financial goals. Likewise, help them do decide if refinancing the mortgage will help in achieving their financial goals.
Answered 1 days AfterApr 11, 2021

Answer To: You provide financial advice to a client (2) Show the calculations to convince the client (3) Use...

Himanshu answered on Apr 13 2021
136 Votes
Sheet1
                                    Financial Year    Friday, October 01, 2021    Friday, September 30, 2022
                                    LISA S
impson
                                    Age    23
                                    Qualification    BA degree    Finance
                                    Job    Tallinn    Full time
                                    Salary    2000    per month
                                    Growth Rate    10%    Per year
                        1            Need to save till Rainy day    10000
                                    Rainy day    29th July 2022    9    months
                                    Amount earned by Lisa Till Rainy day            18000
                                        Lisa need to save    1111.111111    Monthly
                        2            MBA after    10    Years
                                    Salary    2000    per year                                                    10%
                                                                                            30%    Retirment
                                        1    2    3    4    5    6    7    8    9    10    11    12    Annual    Annual...
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