files. Web viewYou are a financial planner for AFS licensee EANWB Financial Planning. Nathan and Mary Davidson have been undertaking their own research into planning their

AssignmentSuperannuation and Retirement Planning (DFP3_v2A5)

Student identification (student to complete)Please complete the fields shaded grey.

Student number

Assignment result (assessor to complete)Result — first submission (Details for each activity are shown in the table below)

Parts that must be resubmitted:

Result — resubmission (if applicable)

Result summary (assessor to complete)First submission Resubmission (if required)

Section 1 Not yet demonstrated Not yet demonstrated





Feedback (assessor to complete)[insert assessor feedback]

DFP3_AS_v2A5

Before you beginRead everything in this document before you start your assignment for DFP3 Superannuation and Retirement Planning.

About this documentThis document includes the following:• Instructions for completing and submitting this assignment.• Assignment sections (including fact finder templates, cash flow templates and managed funds

calculations).– Section 1: Establish the relationship with the client and identify their objectives, needs and

financial situation.– Section 2: Analyse client objectives, needs, financial situation and risk profile to develop

appropriate strategies and solutions. Identify insurance needs.– Section 3: Address clients’ questions and concerns about superannuation matters.– Section 4: Present appropriate strategies and solutions to the client and negotiate a financial plan,

policy or transaction. Provide ongoing service where requested by the client.– Section 5: Agree on the plan, policy or transaction.

How to use the study planWe recommend that you use the study plan for this subject to help you manage your time to complete the assignment within your enrolment period. Your study plan is in the KapLearn Superannuation and Retirement Planning (DFP3v2) subject room.

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Instructions for completing and submitting this assignment

Word countThe word count shown with each question is indicative only. You will not be penalised for exceeding the suggested word count. Please do not include additional information which is outside the scope of the question.

Additional researchWhen completing this assignment, assumptions are permitted although they must not be in conflict with the information provided in the Case Studies.

You may also be required to conduct additional research to properly answer some assignment tasks. This includes sourcing additional information from other organisations in the finance industry to ensure the suitability of products or services to meet the clients’ requirements.

Saving your workDownload this document to your desktop, type your answers in the spaces provided and save your work regularly.• Use the template provided, as other formats will not be accepted for these assignments. • Name your file as follows: Studentnumber_SubjectCode_Submissionnumber

(e.g. 12345678_DFP1B_Submission1).• Include your student ID on the first page of the assignment.

Before you submit your work, please do a spell check and proofread your work to ensure that everything is clear and unambiguous.

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Submitting the assignmentYou must submit your completed assignment in a compatible Microsoft Word document. You need to save and submit this entire document.

Do not remove any sections of the document.

Do not save your completed assignment as a PDF.

The assignment must be completed before submitting it to Kaplan Professional Education. Incomplete assignments will be returned to you unmarked.

The maximum file size is 5MB. Once you submit your assignment for marking you will be unable to make any further changes to it.

You are able to submit your assignment earlier than the deadline if you are confident you have completed all parts and have prepared a quality submission.

The assignment marking processYou have 12 weeks from the date of your enrolment in this subject to submit your completed assignment.

Should your assignment be deemed ‘not yet competent’ you will be give an additional four (4) weeks to resubmit your assignment.

Your assessor will mark your assignment and return it to you in the Superannuation and Retirement Planning (DFP3v2) subject room in KapLearn under the ‘Assessment’ tab.

Make a reasonable attemptYou must demonstrate that you have made a reasonable attempt to answer all of the questions in your assignment. Failure to do so will mean that your assignment will not be accepted for marking; therefore you will not receive the benefit of feedback on your submission.

If you do not meet these requirements, you will be notified. You will then have until your submission deadline to submit your completed assignment.

How your assignment is gradedAssignment tasks are used to determine your ‘competence’ in demonstrating the required knowledge and/or skills for each subject. As a result, you will be graded as either competent or not yet competent.

Your assessor will follow the below process when marking your assignment:• Assess your responses to each question, and sub-parts if applicable, and then determine whether you

have demonstrated competence in each question.• Determine if, on a holistic basis, your responses to the questions have demonstrated overall

competence.

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‘Not yet competent’ and resubmissionsShould sections of your assignment be marked as ‘not yet competent’ you will be given an additional opportunity to amend your responses so that you can demonstrate your competency to the required level.

You must address the assessor’s feedback in your amended responses. You only need amend those sections where the assessor has determined you are ‘not yet competent’.

Make changes to your original submission. Use a different text colour for your resubmission. Your assessor will be in a better position to gauge the quality and nature of your changes. Ensure you leave your first assessor’s comments in your assignment, so your second assessor can see the instructions that were originally provided for you. Do not change any comments made by a Kaplan assessor.

Units of competencyThis assignment is your opportunity to demonstrate your competency against these units:

FNSASICZ503 Provide advice in financial planning

FNSFPL503 Develop and prepare financial plan

FNSFPL504 Implement financial plan

FNSFPL505 Review financial plans and provide ongoing service

FNSASICU503 Provide advice in superannuation

FNSINC501* Conduct product research to support recommendations

FNSIAD501* Provide appropriate services, advice and products to clients

FNSCUS505* Determine client requirements and expectations

FNSCUS506* Record and implement client instructions

* These are prerequisite units of competency for FNSASICU503.

We are here to helpIf you have any questions about this assignment you can post your query at the ‘Ask your Tutor’ forum in your subject room. You can expect an answer within 24 hours of your posting from one of our technical advisers or student support staff.

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Case study — Nathan and Mary DavidsonYou are a financial planner for AFS licensee EANWB Financial Planning. Nathan and Mary Davidson have been undertaking their own research into planning their retirement, and recently attended one of your firm’s retirement seminars. After this seminar they spoke with you about their concerns that they may not accumulate enough money in superannuation to fund their retirement.

You met with them and during your initial meeting you provided them with some basic information, including a fact finder for them to fill out. You then organised a second meeting, at which you collected more information on their current financial situation and spent time clarifying their needs and objectives.

A summary of their financial situation, based on your interviews with the clients, is provided below. The completed fact finder, including the risk profile questionnaire, can be found on page 9 of this assignment.

Current situationNathan, age 54, and Mary, age 52, are married and have two children, Jonathan and Sarah, who are nearing the end of their schooling.

They own their own home, valued at $600,000, and have recently received an inheritance from the estate of Mary’s mother.

Although they have cleared their mortgage they still have access to a redraw facility of $100,000. However, they do not want to access this unless there is as an emergency.

Nathan is a full-time sales representative for an agricultural supplies company. He earns $140,000 annually plus superannuation guarantee (SG) contributions from his employer paid into the employer’s default fund.

Mary is primarily a self-employed marketing consultant and has business income net of expenses of $65,000 annually. She also works as a contracted employee in a mining engineering company. Her hours vary, but typically she earns about $5600 annually, plus SG which is paid into the employer’s default fund.

Jonathan and Sarah attend a private school and Nathan and Mary pay $7,000 annually in fees, uniforms, books, school trips etc.

The only other assets they have are their two cars.

SuperannuationNathan has $270,000 in his superannuation fund and Mary has $99,000. They are both invested in the default balanced option. Further details of their superannuation are in the fact find (Appendix 1).

Neither Nathan nor Mary have made any personal contributions to their superannuation fund.

Nathan’s employer will allow salary sacrificing to superannuation without impacting on any other employee benefits and will maintain his SG contribution based on his pre-salary sacrifice income.

Mary’s employer will not allow her to salary sacrifice to superannuation but does make SG contributions to her superannuation fund.

Nathan and Mary are happy with their current superannuation funds and the underlying investments they are invested in. They do not wish to receive advice in regard to changing their funds or investment portfolios.

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InsuranceNathan and Mary have their life insurance and total and permanent disability (TPD) insurance owned by their superannuation funds.

Nathan and Mary both have self-owned trauma policies and income protection policies. Mary also has business overheads insurance.

Their cars are comprehensively insured and they have home building and contents insurance cover including legal liability cover.

Nathan and Mary have family private health insurance cover.

Further details on their insurance policies are in the fact find.

They have specifically requested that they do not require any advice on their insurance policies.

InvestmentsNathan and Mary have not had any investments other than their superannuation. Surplus income had been used to pay off their mortgage.

However, they do have $350,000 in their savings account that was left over from the inheritance from Mary’s mother’s estate after paying off their mortgage. This savings account, which is their bank’s ordinary transaction account, does not pay any interest.

Other informationNathan and Mary have a credit card with a limit of $30,000 that they use for all their general expenses and entertainment. However, they never spend up to their limit and their average expenses are $7500 per month, which they repay within the interest-free period.

Nathan and Mary take regular annual holidays with their children, and spend about $10,000 per trip.

Other expenses include deductible charity donations and accountant’s expenses of $500 annually.

Needs and objectivesNathan and Mary are concerned they will not have enough money to provide an adequate income in retirement. They do not want to rely on the age pension and would like to be fully self-sufficient if possible.

After the initial meeting with you, they reviewed their situation and decided they would like you to prepare advice using a retirement income of $80,000 a year (in today’s dollars). They based this figure on their current spending after deleting items that will not apply after retirement (such as school fees) and considering their desired lifestyle in retirement. They have used their bank’s ‘Retirement Projector’ and determined that if they live to age 95 and earn 4% (net of inflation) on their investments they will need almost $1.3 million in retirement savings when Nathan is age 65.

Nathan and Mary would like to channel their surplus income into their retirement planning now that they do not owe anything on their mortgage.

They have ‘parked’ the inheritance money in their savings account and plan to retain $50,000 in a secure investment to support the children in their last years at school and into university. They want to invest the balance in a tax-effective way, and are considering adding it to Mary’s superannuation to help her ‘catch up’ because she earns less than Nathan and took time out of the workforce to raise the children when they were young.

Like most people, they would also like to reduce their overall tax liability.

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Closing the interviewBefore concluding your meeting, you review the information provided by Nathan and Mary to check that it is complete and accurate and ask if they have any questions.

Nathan and Mary understand from their own research that there are many ways to add money to their superannuation, but are confused about which will be the most appropriate for them.

You advise Nathan and Mary what happens next and explain that, with their agreement, you will prepare a written report based on the information they have shared with you, which will include recommended strategies to help them to achieve their financial goal of having adequate funds for retirement.

Nathan and Mary agree to proceed to the next stage of the financial planning process and you make an appointment to present the plan in a fortnight.

As their financial planner, your task is to prepare a statement of advice (SOA) that will include strategies to meet Nathan and Mary’s goals.

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Fact finder

Important notice to customersYour planner must act in your best interest when making any superannuation and retirement recommendations. Therefore, before making a recommendation, the planner must ask you about your investment objectives, financial situation and your particular needs.

The information requested in this form will be used strictly for that purpose.

WarningThe planner could make inappropriate recommendations or give inappropriate advice if you fail to fully and accurately complete this form.

Personal and employment detailsPersonal details

Client 1 Client 2

Title Mr Mrs

Surname Davidson Davidson

Given & preferred names Nathan Mary

Home address 1 Galbraith Grove, Stanhope Gardens, NSW 1 Galbraith Grove, Stanhope Gardens, NSW

Business address n.a. n.a.

Contact phone (02) 6655 4477 (02) 6655 4477

Age 54 52

Sex Male Female Male Female

Smoker Yes No Yes No

Expected retirement age In 11 years, approximately age 65 When Nathan retires

Dependants (children or other)

Name Age Sex School Occupation

Jonathan 17 M Yes

Sarah 18 F Yes

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Employment details

Nathan Davidson Mary Davidson

Occupation Sales representative Marketing consultant

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

Any other person to be contacted (e.g. accountant, banker, solicitor etc.)?

Mary is primarily a self-employed sole trader but is also an employed contractor.

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Cash flow statementCash flow Nathan Mary Combined Comment

Salary less any salary sacrificed amount $140,000 $70,600 $210,600 Includes for Mary income net of business expenses and income from employment as above

Non-taxable income nil nil

Rental income n.a. n.a.

Unfranked dividends received nil nil

Franked dividends received nil nil

Interest nil nil No interest paid on cash

Other income (e.g. taxable benefits, trust income, investment income)

nil nil

Total income received before tax $140,000 $70,600 $210,600

Investment expenses nil

Expenses

Mortgage nil nil

School fees $3,500 $3,500 $7,000

Utilities n.a. n.a. Paid as part of the expenses through credit card

Personal insurance $5,496 $3,564 $9,060 Nathan’s annualised premiums: $3,612 trauma, $1,884 income protection.Mary’s annualised premiums:$2,172 trauma, $420 income protection, $972 business overheads.

Car insurance $1,600 $1,600 $3,200

Home building and contents insurance $750 $750 $500

Health insurance $1,422 $1,422 $2,844

Living expenses $45,000 $45,000 $90,000 $7,500 per month through credit card

Holidays $5,000 $5,000 $10,000

House maintenance n.a. n.a. Paid as part of the expenses through credit card

Motor vehicle n.a. n.a. Paid as part of the expenses through credit card

Other

$610 $610 $1,220 Donations

$150 $350 $500 Accountant’s fees

Total expenses $63,528 $61,796 $125,324

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Assets and liabilitiesAsset Owner Value Liabilities Net value Notes

Personal assets

Family home Nathan/Mary $600,000 $0 $600,000 Redraw of $100,000 available for emergency use

Home contents Nathan/Mary $150,000 $0 $150,000 Insured value

Car Nathan/Mary $11,000 $0 $11,000 2008 Ford Focus

Car Nathan/Mary $16,000 $0 $16,000 2008 Ford Falcon XR6

Total $777,000 $0 $777,000

Superannuation

Employer superannuation Nathan $270,000 n.a. $270,000 Balanced option

Employer superannuation Mary $99,000 n.a. $99,000 Balanced option

Total $369,000 $369,000

Other Assets

Savings account Nathan/Mary $350,000 Nil $350,000 Transaction account

Total $350,000 Nil $350,000

Net worth $1,496,000 $0 $1,496,000

Liabilities

Loan Current debt Percentage tax deductible

Interest only Repayment

Home loan n.a. n.a.

Investment property n.a. n.a.

Investment loan n.a. n.a.

Personal loan n.a. n.a.

Other n.a. n.a.

Total $0 $0

Needs and objectivesDetails Comments

Accumulate sufficient funds in superannuation to retire in 11 years on $80,000 a year

They estimate that they will need $1.3m in superannuation when Nathan is about age 65

Use excess income for retirement saving

Retain $50,000 in a secure investment to support children in their last years at school and into university

Invest balance of Mary’s inheritance for retirement

Reduce overall tax liability

Other

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Estate planningDo you have a will? Yes No

When was it last updated: October 2009

Do you have powers of attorney? Yes No

Current superannuation, insurances and investmentsSuperannuation

Member Nathan Mary

Fund name ASSF Super Fund CISF Super Fund

Date of joining fund 1 July 1992 (service date) 1 July 1992 (service date)

Type of fund Accumulation Defined benefit Accumulation Defined benefit

Pension Pensioner Pension Pensioner

Contribution (e.g. 5% of salary)

SG By employer By yourself SG By employer By yourself

Current value of your superannuation fund $270, 000 $99,000

Amount of death and disability cover $720,000 $720,000

Is there provision for you to top-up or salary sacrifice?

Yes No Yes No

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Superannuation taxation details

Nathan Mary

Current value $270,000 $99,000

Tax-free component $0 $0

Taxable component:

Taxed element $270,000 $99,000

Untaxed element $0 $0

Preservation:

Preserved $270,000 $99,000

Unrestricted non-preserved $0 $0

Restricted non-preserved $0 $0

Previous years contributions:

Non-concessional contributions:

Year 1 $0 $0

Year 2 $0 $0

Year 3 $0 $0

Year 4 $0 $0

Concessional contributions:

Year 1 SG only SG only




Other contributions:

Small business CGT exempt contributions: $0 $0

Personal injury payments $0 $0

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Nominated beneficiaries

Name Binding Non-binding(Yes/No)

Trustee discretion(Yes/No)Yes/No Amount

Nathan — Beneficiary is Mary Yes 100% No No

Mary — Beneficiary Nathan Yes 100% No No

Are there any current flags or splits on a superannuation benefit of yours in the event of a marriage breakdown?

Yes/No N Details

Are you a beneficiary of any current flags or splits of a superannuation benefit in the event of a marriage breakdown?

Yes/No N Details

Life insurance details

Life insured Owner Policy type Company Policy number

Death benefit

Comments Annual premium

DOES NOT WISH TO BE REVIEWED

Disability insurance details


Death benefit



Trauma insurance details


Death benefit



Income protection insurance details


Benefit amount

Waiting period

Benefit payment period

Annual premium


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General insurance details

Item covered Owner Policy type Company Combined policy number

Cover amount

Other benefit Total annual premium


Investment details

Investment type Company Purchase date Units held/fixed rate

Current value

Owner

Savings account East Antipodean National Wealth Bank

n.a. $350,000 Nathan and Mary

Investment attitude detailsAre you concerned about the amount of tax that you are paying? Yes/No

Why? Would like to pay less if possible; think tax rates are too high

How important is liquidity (i.e. funds available) to you? Very/Moderately/Not

Why? They are investing for the long term and have enough cash to meet short-term needs

If you had funds available for investing, how would you choose to invest them? Why?

Not certain looking forward — probably in shares and/or property depending how much was available. That’s one of the reasons we are seeking advice.

Are there certain investments that you wish to avoid? Yes/No

Which ones? Don’t want anything exotic or too risky.

RISK PROFILE

Determining your investor risk profile Points

This investor risk profile questionnaire has been designed to help you understand the type of investor you are, so that with the help of your adviser, you can choose the investments that best match your financial objectives

Which of the following best describes your current stage of life? Nathan Mary

Single with few financial commitments. You are keen to accumulate wealth for the future. Some funds must be kept available for enjoyment, such as cars, clothes, travel and entertainment 50 50

A couple without children. You may be preparing for the future by establishing and furnishing a home. There are a lot of things you need to buy. You are probably better off financially now than you may be in the future

40 40

Young family. This is the peak home purchasing stage. You have a mortgage and a very small amount of savings. Probably dissatisfied with your financial position and the amount of money saved 35 35

Mature family. You are in your peak earning years and have the mortgage under control. Many partners also work and any children are growing up and have either left home or require less supervision. You are starting to think about retirement, although it may be many years away

30 30

Preparing for retirement. You probably own your own home and have few financial commitments; however, you want to ensure that you can afford a comfortable retirement. Interested in travel, recreation and self-education

20 20

Retired. No longer working and must rely on existing funds and investments to maintain your lifestyle. You may be receiving the pension and are keen to enjoy life and maintain your health 10 10

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What return do you reasonably expect to achieve from your investments?

A return without losing any capital. 10 10

3–7% p.a. 20 20

8–12% p.a. 30 30

13–15% p.a. 40 40

Over 15% p.a. 50 50

If you did not need your capital for more than 10 years, for how long would you be prepared to see your investment performing below your expectations before you cashed it in?

You would cash it in if there were any loss in value 10 10

Less than 1 year 20 20

Up to 3 years 30 30

Up to 5 years 40 40

Up to 7 years 45 45

Up to 10 years 50 50

How familiar are you with investment markets?

Very little understanding or interest 10 10

Not very familiar 20 20

Have had enough experience to understand the importance of diversification 30 30

Understand that markets may fluctuate and that different market sectors offer different income, growth and taxation characteristics 40 40

Experienced with all investment sectors and understand the various factors that may influence performance 50 50

If you can only get greater tax efficiency from more volatile investments, which balance would you be most comfortable with?

Preferably guaranteed returns, before tax savings 10 10

Stable, reliable returns, minimal tax savings 20 20

Some variability in returns, some tax savings 30 30

Moderate variability in returns, reasonable tax savings 40 40

Unstable, but potentially higher returns, maximising tax savings 50 50

Six months after placing your investment you discover that your portfolio has decreased in value by 20%. What would be your reaction?

Horror. Security of capital is critical and you did not intend to take risks 10 10

You would cut your losses and transfer your money into more secure investment sectors 20 20

You would be concerned, but would wait to see if the investments improve 30 30

This was a calculated risk and you would leave the investments in place, expecting performance to improve 40 40

You would invest more funds to lower your average investment price, expecting future growth 50 50

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Which of the following best describes your purpose for investing?

You want to invest for longer than five years, probably to age 55–60. You are mainly investing for growth to accumulate long-term wealth 50 50

You are not nearing retirement, have surplus funds to invest and you are aiming to accumulate long-term wealth from a balanced fund 40 40

You have a lump sum e.g. an inheritance or an eligible termination payment from your employer, and you are uncertain about what secure investment alternatives are available 30 30

You are nearing retirement and you are investing to ensure that you have sufficient funds available to enjoy retirement 20 20

You have some specific objectives within the next five years for which you want to save enough money 20 20

You want a regular income and/or totally protect the value of your savings 10 10

Investor profile total points

INVESTOR RISK PROFILE SUMMARY

0–50 Defensive

You are a conservative investor. Risk must be very low and you are prepared to accept lower returns to protect capital. The negative effects of tax and inflation will not concern you, provided that your initial investment is protected.

51–130 Moderate

You are a cautious investor seeking better than basic returns, but risk must be low. Typically an older investor seeking to protect the wealth that you have accumulated, you may be prepared to consider less aggressive growth investments.

131–210 Balanced

You are a prudent investor who wants a balanced portfolio to work towards medium to long-term financial goals. You require an investment strategy that will cope with the effects of tax and inflation. Calculated risks will be acceptable to you to achieve good returns.

211–300 Growth

You are an assertive investor, probably earning sufficient income to invest most funds for capital growth. Prepared to accept higher volatility and moderate risks, your main concern is to accumulate assets over the medium to long term. You require a balanced portfolio, but more aggressive investment strategies may be included.

301–350 High growth

You are an aggressive investor prepared to compromise portfolio balance to pursue potentially greater long-term returns. Your investment choices are diverse, but carry with them a higher level of risk. Security of capital is secondary to the potential for wealth accumulation.

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Acknowledgment

The information provided in this financial fact finder is complete and accurate to the best of my knowledge.I understand that a policy purchased without the completion of a fact finder, or following a partial or inaccurate completion, may not be appropriate to my needs. I also understand that a policy purchased that differs from that recommended by the planner may not be appropriate to my needs. I acknowledge that my planner has provided me with the completed financial fact finder, signed by me.

Customer(s) signature(s)

Planner’s name

Planner’s signature

Date

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The Assignment (student to complete)

Section 1: Establish the relationship with the client and identify their objectives needs and financial situation

Section 1: Part A — Establish relationshipApart from the initial contact with the Davidsons at your retirement seminar, you have met with them twice in order to gather the information you need to assess their situation and provide them with advice.

Briefly explain at least five (5) strategies you are likely to use with a client in order to make sure that they are comfortable with you and the interview process. (200 words)

Answer here

Assessor feedback: Resubmission required?

No

Section 1: Part B — Adviser obligationsReferring directly to yourself and your licensee, explain what an FSG is and why it is necessary. Provide details of the law you must comply with and the information the FSG must contain, including your complaints procedure. (250 words)

Answer here


No

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Section 1: Part C — Tax and cash flowUsing the information you have gathered from your clients (i.e. the information provided in the case study and fact finder) complete the table below and determine their cash flow position and annual savings capacity.

You can assume that the clients have no tax deductions or liabilities other than those stated in the case study or fact finder.

Section 1 Table 2

Tax calculation Nathan Mary Combined Comments

Income from employment

Salary or Income from employment

Salary sacrifice

Salary after salary sacrifice

Rental income

Unfranked dividends

Franked dividends

Franking (imputation) credits

Interest

Other income (e.g. taxable benefits, trust income, investment income)

Capital gains < 1 yr

Capital gains > 1 yr

Tax-free component of capital gains

Assessable income

Deductible expenses

Donations

Income protection insurance

Business overheads insurance

Other

Taxable income

Tax on taxable income

Non-refundable tax offsets (e.g. LITO/SAPTO)

Medicare levy

Medicare levy surcharge

Franking rebate

Refundable rebates and offsets

Total tax

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Cash flow Nathan Mary Combined Comment

Salary less any salary sacrificed amount

Total expenses

Total income received before tax less total expenses

Total tax payable from tax table above

Total net cash flow

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Section 2: Analyse client objectives, needs, financial situation and risk profile to develop appropriate strategies and solutions

Section 2: Part A — Gaps in informationIdentify any gaps in your data collection based on the fact finder in Appendix 1 and the summary of information provided. From the interviews, are there any other issues that would need to be followed up with Nathan and Mary? (100 words)

Answer here


No

Section 2: Part B — Risk profileIdentify the Davidsons’s likely risk profile based on the information they have provided. Identify any concerns that you may have with their responses compared with the information in the case study.• Suggest questions you could use to clarify the responses.• Justify why you do or do not think that the score and the resulting risk profile category is an accurate

reflection of their tolerance to risk, and decide on a profile for each. (250 words)

Answer here


No

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Section 2: Part C — StrategiesSummarise appropriate retirement strategies for Nathan and Mary.• Consider superannuation and non-superannuation assets and strategies.• Provide a detailed explanation of why you consider these attests and strategies to be appropriate.• Include the lump sum amount that Nathan and Mary will need at retirement to achieve their income

goal, and strategies to help them reach that goal.• Provide a summary of other recommendations that you will include in your SOA for Nathan and Mary.

(500 words)

Answer here


No

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Section 3: Specialist knowledge

Section 3: Part A — Product researchNathan and Mary have stated they are happy with their current superannuation funds. Provide a summary of the type of research that you might conduct to ensure the suitability of these funds for the clients’ future retirement needs. (250 words)

Answer here


No

Section 3: Part B — Client queries on superannuation contributionsNathan and Mary have a number of questions about superannuation contributions after the seminar they attended and following their research. Respond to their questions, basing your answer on their personal situation. You may be required to re-educate the clients where they are confused or misunderstand the superannuation rules.

Question 1Nathan is confused about taxation of superannuation contributions. He has friends who write a cheque, send it to their superannuation fund and claim a tax deduction. He asks:

Am I correct in assuming that we can both claim personal tax deductions for any superannuation contributions we make? Could you explain the tax deduction rules that apply to our situations, how much can we contribute and when can we start?

Answer Nathan’s questions. (250 words)

Answer here


No

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Question 2Mary asks:

We read an article recently that said Nathan can split the superannuation contributions he makes to my superannuation account. Is that correct, and if so, how does it work?

Answer Mary’s question. (150 words)

Answer here


No

Question 3Nathan is concerned about tax payable if they invest any of their cash savings into superannuation. He says:

I’ve heard that some people have had to pay tax at the highest tax rates on superannuation contributions. Can we be sure we won’t fall into that trap?

Answer Nathan’s question. (150 words)

Answer here


No

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Section 3: Part C — Client queries on superannuation benefit payments

Question 1Mary asks: When and how can we access our superannuation? Can we get it if we are still working?

Explain the rule that applies in their circumstances. Explain when and under what circumstances they will be able to access their superannuation. (200 words)

Answer here


No

Question 2Nathan asks:

I understand that we are too young to access our superannuation any time soon. In general terms, please explain how we would be taxed right now if we were old enough and retiring and we took our money out as a lump sum. I don’t want to commit to something that will work against us.

Discuss the situation if the lump sum was taken at retirement after age 60 and just before age 60. Include a brief explanation of components of the lump sum. How they are taxed? What other matters relate to them? (200 words)

Answer here


No

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Question 3Mary asks:

I don’t like the idea of paying lump sum tax and then losing some benefits. Tell us more about these income stream options. How do they work? What are the rules that apply and how much tax do we pay if we could do it now?

Discuss this in broad terms and explain the situation immediately before and after reaching age 60. Assume Mary and Nathan will continue to work until age 60 and then retire. (300 words)

Answer here


No

Page 28 of 59

Section 4: The statement of adviceYou must now prepare an SOA based on the recommendations made, which will be used to record this advice (including amendments, if any) for Nathan and Mary. Remember that the SOA must be of a standard that is compliant and would be suitable to present to a client.

Important instructions• What to submit: You have been provided with cash flow templates to use for the assignment SOA.

Please include this with your submission.• Template SOAs and SOA preparation software: Do not use the sample SOA published by ASIC as a basis

for your submission. The use of financial planning software and dealer templates to prepare your SOA is also not permitted. Submissions that exhibit excessive reliance on SOA templates may be considered to be plagiarism or collaboration, and may not be considered to be a reasonable attempt at the assignment.

• Assumptions: You must list the assumptions used in your SOA in your assignment submission. These will generally include:– any assumptions you have made regarding missing background information on the clients– any assumptions you have used to calculate future income from your recommended investments– any assumptions used for fees and premiums relating to the products you have recommended.

• Strategy advice: You must provide specific strategy recommendations in the following areas based on the information given:– wealth creation strategies to meet retirement needs – personal investments – strategies using superannuation– asset allocation.

• Product advice: Specific product recommendations are not required but you do need to make and justify any recommendations of the type of product(s) selected for the client’s consideration.

You have been told the clients are happy with their current superannuation funds and do not require any specific advice on their current personal insurance arrangements. However, it is expected that you will provide in the ‘Things to consider section’ of the SOA, appropriate comments about any issues you’ve identified with these areas and their future estate planning needs.

• Cash flow projections: You must include detailed cash flow tables using Appendix 1 and Appendix 2 as a template, showing Mary and Nathan’s situation before and after your recommendations. These should be included as Appendices 1 and 2 to your SOA. Remember to include any insurance premiums in the analysis.

• Recommendations: You should include superannuation projections up to the retirement age of your clients before and after your recommendations as Appendix 3 to your SOA. In addition, please show that your strategy will enable your clients to meet their retirement income goal for 21 years (based on Nathan living to age 84 and Mary to age 85).

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The SOA templateAn SOA has been commenced for Nathan and Mary Davidson, using the data collected in the interviews, their fact finder and their risk profile. You must complete the remaining sections in the SOA as directed. The SOA starts on the following page. Please review the sample case study and the text as a guide to completing your SOA.

Statement of advicePrepared for

Nathan and Mary DavidsonPrepared by

<Your name>Authorised Representative Number: 66666

AR Address

AR contact details

Authorised Representative ofEANWB Financial Planning

ABN: 1010101010

Australian Financial Services Licensee

Licence No. 101010

Head office: 88 Money Lane, Accumulation.

You are entitled to receive a statement of advice (SOA) whenever we provide you with any personal financial advice. Personal financial advice is advice that takes into account any one or more of your objectives, financial situation and needs.

This SOA is a record of the personal financial advice provided to you and includes information on the basis on which this advice is given, information about fees and commissions and any interests or associations which might influence the advice.

If this advice includes a recommendation to you to acquire a particular financial product, other than securities, or an offer to issue or arrange the issue of a financial product to you, we will also provide you with a product disclosure statement containing information about the particular product to help you make an informed decision about that product.

Be aware that the advice contained in the following SOA is valid for a period of 30 days only. If the plan is not implemented within this time, it will need to be reviewed for accuracy.

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Executive summaryIn this section, you need to provide your client with a concise summary of:• their situation• their objectives• your recommended strategy to achieve the objectives• the outcomes your client can expect from adopting the strategy.

The client should be able to read this executive summary and understand the advice you are giving and the reason/s underpinning the advice, and be able to determine whether or not their goals have been achieved. There should be sufficient detail to allow the client to make a decision, taking into account any risk/s involved and your fees. It should be written without using jargon and in clear, unambiguous language, and be appropriate to their level of financial understanding.

Your situationSummarise your client’s current situation. Provide a brief statement about their family, employment, health, asset and debt position. (150 words)

Answer here


No

Your objectivesList your client’s objectives (i.e. their financial and non-financial goals, objectives and needs). Nathan and Mary expressed a desire to address their immediate needs and medium and long-term objectives. Summarise these in point form for Nathan and Mary to confirm. (100 words)

Answer here


No

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Summary of our strategy and recommendations

For the short term — up to one year

Summarise your recommendations for your clients’ short-term goals. Present the strategies in point form to provide a quick picture of your intentions.

Answer here


No

For the medium term — two to five years

Summarise your recommendations for your clients’ medium-term goals. Include strategies that cannot be considered immediately or require monitoring.

Answer here


No

For the long term — more than five years

This is where you need to summarise your recommendations for your clients’ long-term goals.

Answer here


No

Page 32 of 59

Summary of expected outcomes if you implement our adviceFor example:

Should you proceed with the recommendations contained within this report, we estimate that:• You will reduce your debt by $XYZ and/or save $ABC.• You will build wealth in non-superannuation assets to $Y through regular contribution of $X.• Your objective of yyy will be achieved by…• Align the outcomes with the objectives.

Answer here


No

Risks in our adviceIdentify both financial and non-financial risks that can impact the desired outcome.

Answer hereRefer to the sample SOA for examples of relevant descriptions that should be included here and under each subheading below. Include risks that are specific to your strategies.


No

Summary of our fees and commissionsAnswer here


No

Your next stepsAnswer hereRefer to the sample SOA for examples of relevant descriptions that should be included here.


No

Page 33 of 59

Body

While this section contains similar headings as the executive summary, the information provided is more detailed and supports the recommendations made. As with the executive summary, it should be written without using jargon and in clear, unambiguous language, and be appropriate to your client’s level of financial understanding.

Important information about youThis section contains information about you that we used in preparing our advice, such as:• your reasons for seeking advice• what you would like to achieve• your personal and financial information.

Present position

Your reasons for seeking adviceOutline why the client sought advice.

Answer here


No

What you would like to achieveSummarise here what you understand to be your client’s main objectives.

Following our discussions, here is what I understand to be your main objectives and needs:

Answer here


No

Page 34 of 59

Your personal and financial informationListed below is a summary of your relevant personal and financial details that you have provided.

Personal information

Personal details

Fill the gaps

Client 1 Client 2

First name(s) Nathan Mary

Surname Davidson Davidson

Age

Marital status Married Married

Health status

Smoker status Non-smoker Non-smoker

Employment status Permanent Part-time

Employer name

Occupation Sales representative Marketing consultant

Annual salary $140,000 $70,600

Summarise the discussion points that could/need to be raised here.

Answer here


No

Children and dependant details

Answer here

Your existing insuranceFill any gaps.

Personal insurance

Car insurance

Home contents Insurance

Health insurance

Page 35 of 59

Your existing estate planningSummarise the client’s existing estate planning provisions here.

Answer here


No

Financial information

Current income and expense details

Income and expenses

Complete the table:

Nathan Mary Total

Assessable income

Net tax payable

Yearly expenses

Estimated surplus

Discussion points:

From the table you have prepared and your cash flow analysis identify questions you will need to ask about their income, lifestyle, expenses and intentions, before you start preparing your strategies. What are the gaps?

(100 words)

Answer here


No

Page 36 of 59

Assets and liabilitiesValue Liability Net value

Home

Home contents

Motor vehicles

Personal assets

Employer superannuation — Nathan

Employer superannuation — Mary

Savings account

Investment assets

Net worth

Discussion points:

Prepare discussion points you will use to obtain a better understanding about how your clients see their situation and future. What are their attitudes to debt, personal assets, investments and superannuation assets that can assist you with your advice? What are the gaps? (100 words)

Answer here


No

Incomplete and/or inaccurate information warningNote that if, for any reason, the information on which our advice is based is incomplete or inaccurate, then it may not be appropriate. Before acting on the advice, you should consider its appropriateness in light of your particular circumstances, needs and objectives.

Page 37 of 59

Your risk profileIn this section, you need to provide:• an overview of the different risk profiles• the risk/return characteristics of various asset classes• the client’s risk profile including the appropriate mix of assets (the asset allocation) for the client’s risk

profile, the appropriate investment return time horizon for that profile and any specific concerns. Discuss their attitudes to investing and any other experience or interests that can support your assessment.

Answer here


No

Page 38 of 59

Strategy recommendationsThis section tells you:• what our advice is and why it is appropriate for you• reasons for our recommendations• what you need to consider and any risks associated with our advice.

Read this section carefully and ask me if you have any questions.

Recommended action — first year

You will use your findings from the analysis you did in the assignment above as the basis for the information you will need to provide in this section.

For each recommendation below discuss the reasons, risks, advantages and disadvantages.

All recommendations should be listed here. They are to include investment and debt management recommendations. You are not required to provide specific advice to your client about their estate planning needs. However, if after analysis of their situation you believe that advice is required, you need to explain what advice they should seek and why.

Concept. If you use technical terms or concepts in your discussion explain what the terms mean. For example do not assume they know what ‘gearing’ or ‘franking’ means

Note: You do not have to complete all of the recommendation boxes below. You can add more boxes if required.

Recommendation 1

Answer here


No

Recommendation 2

Answer here


No

Page 39 of 59

Recommendation 3

Answer here


No

Recommendation 4

Answer here


No

Things you should considerIn this section briefly discuss strategies that you did not recommend and that could be considered at another time and what they could do for them.

Answer here

Refer to the sample SOA for examples of relevant descriptions that should be included here and under each subheading below.


No

Retirement planning

Briefly state what has been achieved with your strategies and highlight what still needs to be addressed or reviewed.

Answer here


No

Page 40 of 59

Estate planning

You have recorded their estate planning details for completeness of information gathered in the fact finder. You have explained that you cannot provide legal advice. However, if you see deficiencies in their current structure, discuss them briefly and suggest a course of action. (100 words)

Answer here


No

Taxation issues

My strategies and recommendations have had the following impact on your tax position:

Answer here


No

Page 41 of 59

Recommended asset allocation

Proposed asset allocationYour investment assets are invested across various asset classes. The table below summarises:• Weight: The proposed asset allocation resulting from our recommendations.• Risk profile weight: The recommended asset allocation for your investment risk profile.• Variance (weight): The variance between the recommended and proposed asset allocation.

Asset allocation after implementation of recommendationsAsset allocation Weight Risk profile weight Variance (weight)

Defensive assets

Australian cash Answer here Answer here Answer here

Australian fixed interest Answer here Answer here Answer here

International fixed interest Answer here Answer here Answer here

Total for defensive assets Answer here Answer here Answer here

Growth assets

Australian equities Answer here Answer here Answer here

Australian property Answer here Answer here Answer here

International equities Answer here Answer here Answer here

International property Answer here Answer here Answer here

Total for growth assets Answer here Answer here Answer here

Grand total Answer here Answer here Answer here

Comments on proposed asset allocation versus your risk profileYou need to explain the reason for any large (greater than 10%) variances here. Refer to the sample SOA for a discussion on variances. Discuss how the situation will change over time.

Answer here


No

Page 42 of 59

Investment product recommendations

Product recommendationsNote that I can only recommend products on our recommended list, which have been approved byEANWB Financial Planning.

Use the space below to list the products that you are recommending Nathan and Mary invest in, and those that they already have that you are recommending they keep.

Nathan and Mary Davidson, following our investment strategy, we recommend that you invest in the following products:Answer here


No

Relevant research material and PDSs are attached for your attention. It is important that you read these documents carefully and contact us should you have any questions or if there are areas of the document that you do not fully understand. All of these products are on our approved recommended list.

Note: You do not need to include these PDSs as part of your assignment. The above statement is a standard inclusion in an SOA.

Cooling-off periodDetails on the cooling-off period for each product are provided in the PDS.

Page 43 of 59

Disclosure of remunerations, commissions and other benefits

How are we paid?

Commissions and fees — upfront, ongoing and financial planning advice fees

If you are charging SOA preparation fees, implementation fees, ongoing advice fees, or any other non-product related fees you must provide the details here. You may need to source information outside of the subject notes to complete this requirement. However, you can use the examples of how fees are shared between advisers and licensees from the sample SOA if needed.

If you are not charging these fees you may either delete the table below or fill it in with $0 as the fee charged to make it clear.

Fee type Initial fee Initial fee paid to licensee Initial fee paid to adviser

SOA fee Answer here Answer here Answer here

Implementation fee Answer here Answer here Answer here

Ongoing advice fee* Answer here Answer here Answer here

Total Answer here Answer here Answer here

*If the ongoing service fee is charged as a percentage of the product(s), you may use the table below instead. If you are charging a flat fee,or an hourly fee you should use this table.

Investment recommendations

Summarise all of the products that you have recommended to the client here. Refer to the sample SOA for examples of what to include. You will need to source information outside of the subject notes to complete this table, based on the products you have used (or created).


No

Page 44 of 59

If you wish to implement the products I have recommended, there may be initial and ongoing fees applicable as detailed below.

Product Initial fee Initial fee paid to licensee

Initial fee paid to adviser

Ongoing fees paid to licensee

Ongoing fees paid to adviser

Answer here Answer here Answer here Answer here Answer here Answer here

Answer here Answer here Answer here Answer here Answer here Answer here

Total Answer here Answer here Answer here Answer here Answer here

Note: Please see the sample SOA for directions on completing the answers in the paragraphs below.

Product providers will also charge a fee for the management of the funds invested in their products. The annual management fee charged by Answer here is Answer here %. The amount you will be charged will depend on the funds you have invested.

For example, $Answer here invested with them will incur a $ Answer here annual management cost.

Commissions

Our policy on taking commissions from product and service providers is summarised below:

Answer here


No

Other fees and benefits

EANWB Financial Planning and I may also receive additional benefits. Where the benefits received are greater than $300 in value, they will be recorded in a register that meets the requirements of the Financial Planning Association (FPA) Code of Professional Practice on alternative forms of remuneration. A copy of the register for EANWB Financial Planning is publicly available and can be provided on your request.

Ongoing services

You need to make sure that your client fully understands what you are offering in terms of ongoing service.

Draft an outline of the level of ongoing service you intend to recommend to Nathan and Mary. In your outline, discuss the type of information that you would regularly provide to Nathan and Mary in relation to their financial planning needs. (250 words)

Answer here (refer to the sample SOA for the sorts of services you could include here).


No

Page 45 of 59

Ongoing service fee

What would you do to ensure that Nathan and Mary know the specific costs relating to an ongoing service? (100 words)

Answer here


No

Page 46 of 59

Implementation scheduleIn order to ensure that your recommendations will be implemented efficiently, you need to make sure that all tasks that need to be completed, both by you and the client, are itemised in the schedule. The schedule should highlight the priority of each task, as well as the order of completion. The time frame should be as specific as possible.

Nathan and Mary Davidson, in order to proceed with our recommendations, you will need to complete the steps below:

Action By whom By when

Answer here Answer here Answer here









Note: The recommendations contained in this SOA are current for 30 days only. Please contact me for further discussion if you are unable to act on our recommendation within this time frame.


No

Page 47 of 59

Authority to proceedBy signing this authority to proceed, I/we Nathan and Mary Davidson acknowledge the following:• I/We acknowledge that the information I/we provided in the financial needs analysis 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 <Your name> dated <Date>.

This document contains information which accurately summarises my/our current situation, investments and financial objectives.

• I/We have been provided with an EANWB Financial Planning FSG.• I/We have read and understood the PDSs for the recommended products.• 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:

Product(s) Amount

Answer here Answer here



• I/We wish to make the following change/s to the recommendations within the SOA:

Product(s) Amount




Signed__________________________________ Date _____/_____/______Client Name


Signed__________________________________ Date _____/_____/______Financial Planner

Page 48 of 59

Consent to ongoing contactI/We consent to being contacted by our adviser on an ongoing basis, in line with the agreed ongoing service review structure detailed within this recommendation. My/our preferred hours of contact are between ____ and ____.



Page 49 of 59

SOA — Appendix 1: Current situationNote: The items listed in this template are indicative only and must be adapted to your client’s personal circumstances. There may be other relevant income or expense items that are not included in this template. You should add, delete or substitute items where appropriate.

Cash flow statement

Income and expenses

Client 1 Client 2 Notes


Salary

Salary sacrifice (state % if applicable)


Rental income

Unfranked dividends

Franked dividends (state % return if applicable)

Franking (imputation) credits (state franking % if applicable)

Interest (state % return if applicable)

Other income, e.g. taxable benefits

Capital gains <1yr

Capital gains >1yr


Assessable income

Deductible expensesInclude income protection premiums if held outside superannuation

Rental expenses, repairs etc.

Taxable income

Tax on taxable income (state year applied)


Medicare levy


Franking rebate


Net tax payable

Page 50 of 59

Family cash flow

Client 1 Client 2 Combined

Salary less any salary sacrifice amount

Non-taxable income (e.g. income from superannuation income streams for a person over age 60, Family Tax Benefit)

Interest income

Dividends received (excluding franking credits)

Rental income

Other income

Total income received before tax

Investment expenses

Interest payments

Rental expenses

Other

Living expenses

General living expenses

Home mortgage

Car payment

Credit cards

Holiday

Children’s education

Other loans e.g. personal

Insurance premiums

Other

Total expenses

Total income received before tax less expenses

Net tax payable from the ‘Income and expenses’ table above

Net cash flow

Page 51 of 59

Assets and liabilities

Asset Owner Value Liabilities Net value Notes

Personal assets

Family home

Home contents

Car 1

Car 2

Other

Total

Investment assets

Investment property

Savings account

Term deposit

Shares

Other

Total

Superannuation assets

Client 1 superannuation


Total

Net worth

Liabilities

Loan Current debt Percentage deductible Interest only Repayment

Loan

Home loan

Investment property

Other

Total

Page 52 of 59

SOA — Appendix 2: Post strategy implementationNote: The items listed in this template are indicative only and must be adapted to your client’s personal circumstances. There may be other relevant income or expense items that are not included in this template. You should add, delete or substitute items where appropriate.

Cash flow statement

Income and expenses

Client 1 Client 2 Notes


Salary

Salary sacrifice (state % if applicable)


Rental income

Unfranked dividends

Franked dividends (state % return if applicable)

Franking (imputation) credits (state franking % if applicable)

Interest (state % return if applicable)

Other income, e.g. taxable benefits

Capital gains <1yr

Capital gains >1yr


Assessable income

Deductible expensesInclude income protection premiums if held outside superannuation

Rental expenses, repairs etc.

Taxable income

Tax on taxable income (state year applied)


Medicare levy


Franking rebate


Net tax payable

Page 53 of 59

Family cash flow

Client 1 Client 2 Combined

Salary less any salary sacrifice amount

Non-taxable income (e.g. income from superannuation income streams for a person over age 60, Family Tax Benefit)

Interest income

Dividends received (excluding franking credits)

Rental income

Other income

Total income received before tax

Investment expenses

Interest payments

Rental expenses

Other

Living expenses

General living expenses

Home mortgage

Car payment

Credit cards

Holiday

Children’s education

Other loans e.g. personal

Insurance premiums

Other

Total expenses

Total income received before tax less expenses

Net tax payable from the ‘Income and expenses’ table above

Net cash flow

Page 54 of 59

Assets and liabilities

Asset Owner Value Liabilities Net value Notes

Personal assets

Family home

Home contents

Car 1

Car 2

Other

Total

Investment assets

Investment property

Savings account

Term deposit

Shares

Other

Total

Superannuation assets



Total

Net worth

Liabilities

Loan Current debt Percentage deductible Interest only Repayment

Loan

Home loan

Investment property

Other

Total

Page 55 of 59

SOA — Appendix 3 – ProjectionsYou can use two methods to calculate and show the clients’ projected superannuation balances based on the strategies recommended.

Firstly, you may use an Excel spreadsheet to project the balance of the clients’ superannuation funds up until the age of retirement (i.e. age 65 for Nathan) before and after your recommendations. You should then show the analysis that demonstrates that the clients can generate $80,000 annually from their superannuation for 21 years.

Use the FV formula in Excel to calculate annual balances for the accumulation and you can also use it to show drawdown of the income in a separate calculation.

Alternatively, depending on the strategies you have recommended, you may use one of the following online financial calculators to assist you in completing these tasks:1. First State Super: <https://supercalcs.com.au/FSS_TransCalc/Home/YourDetails>.2. Russell Investments: <https://www.yoursupersolution.com.au/Calc/TtrDisclaimer.aspx>.3. Superfacts Calculator: <https://secure.superfacts.com/calcs/ttr/default.htm?site=mercer#Top0>.4. Hesta: <https://www.hesta.com.au/resources-calculators/calculators.html>.5. ASIC’s Moneysmart Calculator: <https://www.moneysmart.gov.au/tools-and-resources/calculators-and-

apps#super >.

Assumptions:• Rates of return are net of inflation to project in today’s dollars.• Rates of return are appropriate to the clients’ risk profiles.• Rates of return are after fees.• Ignore contributions tax on SG and salary sacrifice, if any.• In retirement the clients’ funds are invested in a conservative asset allocation and the rate of return

should be no higher than 3% net of fees and inflation.

Please ensure that you use a rate of return that is net of inflation and is appropriate to the clients’ risk profile.

Include details of all assumptions that you have made. You may ignore the impact of contributions tax on the SG and salary sacrifice, if any.

Use a table such as exampled in Table 1 below to show the expected financial result of the projections. Use the form of table on the following page (Table 1(a)) to complete the list of assumptions.

Page 56 of 59

https://www.moneysmart.gov.au/tools-and-resources/calculators-and-apps#super

https://www.moneysmart.gov.au/tools-and-resources/calculators-and-apps#super

https://www.hesta.com.au/resources-calculators/calculators.html

https://secure.superfacts.com/calcs/ttr/default.htm?site=mercer#Top0

https://www.yoursupersolution.com.au/Calc/TtrDisclaimer.aspx

https://supercalcs.com.au/FSS_TransCalc/Home/YourDetails

Table 1 Superannuation account balance projectionsCurrent situation After recommended strategy

Nathan’s age

Nathan’s account balance at year end

Mary’s account balance at year end

Combined account balance

Nathan’s account balance at year end

Mary’s account balance at year end

Combined account balance

54

Table 1(a) Assumptions relating to Table 1 above

Value Nathan: Current Mary: Current Nathan: Strategy recommendations

Mary: Strategy recommendations

Contribution amount: SG and any other payment (pmt)

Contribution frequency

Rate = the rate of return of the fund, net of inflation and fees

Hints for using the FV formula in Excel to predict account balances

• Nper = either 1 for annual or 12 for monthly contributions• PV = value of the superannuation at the end of the previous year and should be entered as a

negative value• rate = annual rate divided by the frequency of contributions• pmt = the contribution amount and should be a negative value when accumulating funds and positive

when funds as being drawn from the superannuation• type = (can be left blank) indicates that the payments happen at the end of each period.

Page 57 of 59

Table 2 Superannuation income analysis post-retirementNathan’s age Combined account balance Assumptions Combined fund

65 Rate of return net of inflation

66 Frequency of drawdown

67 Income p.a. $80,000

68

69

70

71

72

73

74

75

76

77

78

79

80

81

82

83

84

85

86

Page 58 of 59

Section 5: Present appropriate strategies and solutions to the client and negotiate a financial plan, policy or transaction

Section 5: Part AThe SOA has been completed and a meeting has been organised with Nathan and Mary to present the recommendations and, if they agree, to implement them.

Describe the steps that should be followed in presenting this advice to Nathan and Mary. In your answer, you should address at least four (4) of the following requirements regarding presentation of advice:• The order in which you present the information.• What backup information and documents might you need?• Any risks associated with the solution.• Two (2) predictable questions the Davidson might ask you, and the answers you will give.• The language you will use to present the strategy to Nathan and Mary. (400 words)

Answer here


No

Section 5: Part BSuggest a minimum of two concerns that the Davidson might have with the strategy that you have proposed. Explain how you would address each of these concerns. (100 words)

Answer here


No

Page 59 of 59

Documents

files. Web viewYou are a financial planner for AFS licensee EANWB Financial Planning. Nathan and Mary Davidson have been undertaking their own research into planning their