It is definitely very hard for Tom if he wanted to access the same investment in managed funds by himself, however, by a managed fund he can invest in diversified portfolio of investment by accessing more than one investment in more than one asset class. This means he can invest in those assets that is usually unavailable to single investor and also generate higher return with lower risk. Besides, because the investment is managed by quantitative specialists and professionals with years of experience in investing, they can reinforce the good performance of managed fund. Last, because Tom is going to enjoy "good life", he does not want to contribute much time and energy to manage his investment, then investing in managed fund will relief himself from numerous investment activities.
that was abby wrote for managed funds as the question is talking abt how to transfer into managed funds.so make sure u include a large proportion of the benefits and all that shit of Managed Funds in this question. cheers rachel
Question 1 a. If Barbara retires at 62 The compound interest in 7 years when Barbara retires at 62 is (1+6%)^7= 1.504 The amount of money in the savings account is ($37,000+ $60,000)* 1.504 = $ 145,888 The amount of money she will have available at retirement is $ 145,888+$ 112,500 = $ 258,388
If Barbara retires at 65 The compound interest in 10 years when Barbara retires at 65 is (1+6%)^10= 1.791 The amount of money in the saving account is ($37,000+ $60,000)*1.791 = $ 173,727 The amount of money she will have available at retirement is $173,727+$127,500 = $ 301,227
b. If Barbara retires at 62, the annual retirement income form annuity will be $258,388/12.659= $20,411
If Barbara retires at 65, the annual retirement income from annuity will be $301,227/11.118= $27,094
c. The total annual retirement income if Barbara retires at 62 is $20,411+$16,308 = $36,719<45,000
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e. Given Barbara’s current financial condition (low savings, large proportion of her current available funds derived from the remaining life insurance policy, presumably a low income job as a receptionist in the remaining years of employment), it is more likely to assume that her risk tolerance is low, which implies that she is at the income requirement stage of her life, consequently, she is highly risk-averse in investments. Therefore, a savings account and an annuity, which are totally risk free best, reflect her risk tolerance level
( ... )
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rachel
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a. If Barbara retires at 62
The compound interest in 7 years when Barbara retires at 62 is (1+6%)^7= 1.504
The amount of money in the savings account is ($37,000+ $60,000)* 1.504 = $ 145,888
The amount of money she will have available at retirement is $ 145,888+$ 112,500 = $ 258,388
If Barbara retires at 65
The compound interest in 10 years when Barbara retires at 65 is (1+6%)^10= 1.791
The amount of money in the saving account is ($37,000+ $60,000)*1.791 = $ 173,727
The amount of money she will have available at retirement is $173,727+$127,500 = $ 301,227
b. If Barbara retires at 62, the annual retirement income form annuity will be $258,388/12.659= $20,411
If Barbara retires at 65, the annual retirement income from annuity will be $301,227/11.118= $27,094
c. The total annual retirement income if Barbara retires at 62 is $20,411+$16,308 = $36,719<45,000 ( ... )
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