Case Study #3

 

Kayla & Josh:
Young Parents

The Situation:

For parents, there are all sorts of challenges to deal with.

After all, raising kids is tough. And expensive.

Kayla & Josh want to focus on their Financial Health, but aren’t exactly sure what to prioritize. Some of their questions may include:

  • How much should they be saving each month?

  • Where should those savings be directed?

  • How can they lower the taxes they pay over time?

  • If they want to move, “how much” house should they buy?

  • What can they do now to strengthen their children’s financial security and educational options?

  • How much life insurance should they have?

They will have plenty of other questions, but those may be some of the big ones.

Our Approach:

The appropriate service for Kayla & Josh would either be a Financial Check-Up or Comprehensive Financial Planning.

Financial Check-Up

If they opt for a Financial Check-Up, we would look at the basics of their situation to give them an idea of how they are doing compared to where they “should” be at their ages.

We would discuss what their recommended cash position is, how to save up for a new home, how to prioritize their savings, and more.

The idea would be to point them in a positive direction and then Kayla & Josh can implement those things on their own.

Comprehensive Financial Planning

If they opt for Comprehensive Financial Planning, we would consider each area of the Circle of Financial Health, and then do a deep dive into the ones that pertain to Kayla & Josh’s situation:

 
 

Strategies would likely include:

If they are Comprehensive Financial Planning clients, we may explore:

  • Saving strategies to ensure that they are taking care of themselves, in addition to taking care of children.

  • Reduction of taxes through the appropriate use of retirement contributions, Roth conversions, and charitable contributions.

  • Improved asset allocation to better align with their goals.

  • An appropriate investment rebalancing strategy.

  • Creating a plan to save for college costs for their children.

  • Shoring up estate plans, especially since there are children in the picture (biological and/or adopted).

  • Appropriate life insurance coverage, given their family situation.

  • Ensuring they have enough to fund what matters most.

The ultimate goal would be for Kayla & Josh to be able to enjoy the peace of mind that comes from a clear financial plan and overall Financial Health.

 

Note: The above case study is hypothetical and does not involve an actual Spencer Financial Planning client. No portion of the content should be construed by a client or prospective client as a guarantee that he/she will experience the same or a certain level of results or satisfaction if Spencer Financial Planning is engaged to provide investment advisory services.