CLIENT SIT­U­A­TION

The Globe and Mail (BC Edition) - - REPORT ON BUSINESS -

The peo­ple: Bob, 54, Betty, 48, and their three chil­dren

The prob­lem: Will they be able to pay for their chil­dren’s ed­u­ca­tion right through uni­ver­sity and still re­tire early with­out hav­ing to crimp their life­style?

The plan: Sell off some in­vest­ments to pay down debt this year. Plan to draw on line of credit to help fund chil­dren’s ed­u­ca­tion, re­pay­ing it later. Tar­get a 6.3-per-cent rate of re­turn on in­vest­ments or be pre­pared to work longer or spend less.

The pay­off: Fi­nan­cial se­cu­rity

Monthly net in­come: $10,857

As­sets: Home $900,000; cash $1,000; her DC pen­sion $1,820; her locked-in re­tire­ment ac­count from pre­vi­ous em­ployer $276,703; spousal RRSP $234,860; her TFSA $15,908; her non-reg­is­tered stock $37,746; his RRSP $229,013; es­ti­mated present value of his DB pen­sion $740,000; RESP $57,030. To­tal: $2.5-mil­lion

Monthly dis­burse­ments: Mort­gage $2,110; prop­erty tax $614; home in­sur­ance $60; util­i­ties $331; main­te­nance, gar­den $150; ve­hi­cle lease $525; ve­hi­cle in­sur­ance $225; fuel, oil, main­te­nance $450; park­ing/tran­sit $100; gro­ceries $1,400; cloth­ing $200; line of credit $100; gifts $250; va­ca­tion, travel $700; din­ing, drinks, en­ter­tain­ment $1,100; per­sonal care $150; club mem­ber­ships $60; pets $75; sports, hob­bies $600; sub­scrip­tions, other per­sonal $125; vi­ta­mins $25; life in­sur­ance $75; cell phones $325; TV, in­ter­net $300; RESP $250; tu­ition $3,167. To­tal: $13,467 Short­fall: $2,610

Li­a­bil­i­ties: Mort­gage $277,534; line of credit $31,925. To­tal: $309,459

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