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Personal financial planning - Essay Example

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Undergraduate
Essay
Finance & Accounting
Pages 6 (1506 words)

Summary

Briefly explain what options are available to Jack with respect to the payment he will receive upon termination of his employment, including his superannuation balance. Calculate the resultant tax treatment of the payment with respect to those options.

Extract of sample
Personal financial planning

Briefly explain what options are available to Jack with respect to the payment he will receive upon termination of his employment, including his superannuation balance. Calculate the resultant tax treatment of the payment with respect to those options.One of the best options jack could plan is to pay a small amount of future pre-tax salary to the investments. The plan for such investments would also help to pay for personal insurance to protect the family income.During this period Jack would have return of deposits amounting to $ 8000 and the return from superannuation as $ 1350. This could be deposited on long term basis and as the seven years are completed the amount could be added with the Marions return to meet their living expenses.At the present rates both Joe and Marion would require $ 55,000 to lead a very comfortable life. If this is the amount that the couples expect after their retirement then the they must have accumulated saving of $137500 at 4 % interest per annum. Their total savings is estimated as 4,36,000/- which doesn't include the superannuating benefits of both Joe and Morion.Even if these aspects are accounted the current position would be enough if they expect to support in the same manner in future. The cost of living certainly would enhance and hence the gaps that exist between the current estimate and actual expense in future would be very huge.The major benefit of transition to retirement provision is to receive a part of superannuation as pension while being involved with it. ...
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