A client report

You are to write a client report (2500 words in maximum ) for the Vine family that covers the following:

1. A financial plan for Fergus and Felicity. (60 marks- see below for allocation)
   You should make a judgement about the timescale of this plan, taking into consideration the financial
   milestones and factors mentioned in the case study.
   It should include:
   a. A clear breakdown of the couple’s objectives over the short, medium and long term. You should clearly show
   a financial plan that models the likely changes in the couple’s financial situation from now until the years to
   retirement, taking into account all of the information in the scenario (you may use excel for this and include as
   an appendices). You need to determine the key milestones that will change the couple’s income and
   expenditure between now and retirement and model how these will change their overall financial position. You
   should consider at least two alternative scenarios you judge possible given the ages of both Fergus and
   Felicity and their possible retirement ages. (Please note you are not required to re calculate the current net pay
   of the couple and should use the approximate estimate of joint net income in any projections). 10 marks
   b. Specific advice regarding the 2014/15 pension reforms. You should make clear to the couple to which
   pensions they are relevant and what options the couple have as a result. You must provide specific
   recommendations for Fergus as to the final salary scheme transfer, including the advantages and
   disadvantages of transferring his defined benefit scheme to a defined contribution scheme.
   10 marks
   c. Advice regarding any issues mentioned in the case study in relation to capital gains and inheritance taxation
   (provide supporting calculations), estate planning and care planning (please note that Fergus and Felicity
   would like to know what the potential impact of care costs could be on their future inheritances). You are
   expected to use 2020/21 tax year in calculations. 16 marks
   d. Based upon the couple’s risk profile, recommend two separate investment portfolios for Fergus and Felicity.
   You should consider the funds available, clearly showing where these funds have come from (exclude
   pensions from this). You should also attempt to model the performance of the portfolio and whether or not it is
   likely to achieve the goals you stated in part a (you may ignore inflation or justify your assumptions with
   regards to growth rates and inflation). 16 marks
   e. Provide mortgage advice to Ethan. You should identify appropriate mortgage options and comment on their
   affordability as well as advising Ethan about other costs (both one off and continuing) of buying a property. You
   should calculate Ethan’s net pay and suggest a possible monthly budget that may help Ethan manage his
   money in the first year. 8 marks

Sample Solution