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Essentials of Personal Financial Planning by Tom Tillery, Susan Tillery

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CHAPTER 10 INVESTMENT BASICS

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CASE STUDY

Virginia and Joseph Plant have been married for 20 years. They have not slowed down long enough for children and have always lived beyond their means, financed by annual withdrawals from a trust fund established for Virginia by her father. Both are 59 and they are now considering what it will take for them to reach financial independence.

Virginia has been the financial anchor. Presently, she is working in the advertising department of a Fortune 100 company. Her hard work, talent, and tenure have allowed her to break through to an annual income of $300,000. Joseph, on the other hand, never found his niche in the labor market. He has tried repeatedly to start a rock ‘n’ roll band. He DJs at local nightclubs on weekends and works as an independent contractor for the local NPR affiliate during the week, as well as hosting the station’s oldies but goodies program.

Virginia’s mother died unexpectedly earlier this year. She left Virginia $1 million in an IRA and a condo on Lake Shore Drive. The IRA is all in cash or cash equivalents. The Plants are hopeful that, for the present, the condo can be their summer home and they will continue to live and work in the city. Virginia also has $250,000 in her employer-based retirement plan. Joseph has $50,000 in his retirement plan. The trust left by Virginia’s father is invested in a separately managed ...

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