Financial Planning for Retirement Client Case
For this assignment, use 2023 numbers.
Write to your clients. Consider the questions below as a guide for different areas in the retirement plan you will address.
Advise James on how much he should contribute to his 401k and IRA, if applicable. If he receives an employer match, how much will he save this year in his 401k? What does catch-up contribution look like next year (what changes did the Secure Act 2.0 make regarding catch-up contribution)? Should James and Pamela consider doing a spousal IRA? (Note, for clients, resources are limited. Therefore, you must consider their current budget and cash flow when making recommendations).
When will James and Pamela have to start RMD (remember to consider Secure Act 2.0 changes)? Should they consider doing a Qualified Charitable Distribution (QCD)? Be sure to educate them on QCDs and the rules surrounding QCDs, given they have charitable intentions.
Is Pamela allowed to roll her 403b to an IRA? If so, would you recommend her doing so, and why?
Should James and Pamela consider doing Roth conversions at some point? If so, when should they consider doing it? What accounts should they consider doing conversions from? How much should they try to convert? How will this impact their overall wealth?
Assuming James and Pamela each have a moderate growth risk tolerance, they would like to invest 70% equities and 30% bonds. Using these Vanguard Models as a guide, recommended is an asset allocation for your clients. Assume James is limited to the Vanguard funds listed in his portfolio. If Pamela rolled over her 403b to an IRA, you could invest in most stocks, bonds, mutual funds, and ETFs. you can use this TD Ameritrade tool to assist in your analysis.
