The overall purpose of a Statement of Advice (SOA) is to provide your client with sufficient information about the advice you are providing to enable them to make an educated decision about whether to act on the advice. You will be required to complete a SOA using the template provided.
In addition to the various legal disclosures required in the SOA, at its core you will need to ensure it includes, in sufficient detail, your financial planning recommendations based on the case study and
financial information provided below.You will need to include the reasons for, and the financial consequences and risks associated
with, each of your recommendations.
Please base your financial planning strategies and financial information on the basis of the tax and superannuation legislation presented in lectures and tutorials.
Task: BANK3005 Applied Financial Planning-Statement of Advice Assignment
Case Study – Jennifer and Harry Beulah
[Important: Please note that since your Strategy Paper presentation, Harry has decided to retire on 1 January 2019. Consequently, they would like you to help them with any Centrelink Age Pension entitlements. Jennifer will retire at Age 60 as initially planned].
Jennifer and Harry were referred to you by one of your clients Geoff and Caroline. You met with them on 1 August 2018. Jennifer’s date of birth is 18 March 1961, and Harry’s date of birth is 29 September 1955. They have three children, Zoe (27 years of age), Jack (25 years of age) and Zach (24 years of age). They all live at home.
They have recently inherited some money from Jennifer’s father’s estate. The money is held in a savings account. They are quite organised, and have provided you with a financial summary which is outlined below. Jennifer stated she is unhappy paying the amount of tax she does, and would like to know more about how to minimise this. Her colleagues talk about how much tax they are saving via salary sacrificing into superannuation.
All of their Superannuation is derived fully from employer contributions – they have never made any additional contributions to their superannuation funds. Harry does not want to take on too much risk with investment markets. His mother lost 50 per cent of her share portfolio during the 2008 Global Financial Crisis (GFC). Jennifer understands the ups and downs of the market, but also does not want to take in too much risk.
After some discussion and analysis using financial charts and various scenarios, it was agreed that they are ‘Balanced’ investors with a preference to invest 70 per cent in growth assets and 30 per cent in Defensive assets.
- All document margins must be at least of three centimetres, the font size must be at least 11 point, and use of the Arial font (or an equivalent) is preferred.
- A cover page stating your names, Student IDs and the Course details is required.
- Any assignment that is not referenced to University standard will receive a mark of zero.
- Note that the UniSA style of the Harvard System of referencing is preferred.
Superannuation Fees: BANK3005 Applied Financial Planning-Statement of Advice Assignment-New South Wales University Australia
The Uni Super and ABC Super are invested 85 per cent Growth Assets and 15 per cent Defensive assets. Harry’s Old Fund Super account is invested 100 per cent in Cash (Defensive). The administration fee on the Old Fund is a high 2.9 per cent per annum. UniSuper and ABC Super fees are very competitive at $75 per year.
The investment fee comes out of the return of the fund. UniSuper investment fee is 0.76 per cent and ABC Super 0.74 per cent per annum. The Old Fund investment fee on the cash fund is 0.15 per