twin boys, who just lost his job as a Finance Analyst. He was employed for nine (9) years with Vroom Finance, a vehicle financing company. Management decided to restructure the company to cut costs and stay competitive. As a result, Darius, along with seven (7) other employees was made redundant.
The Client: Darius Williams, 44 is a single father with three-year-old twin boys, who just lost his job as a Finance Analyst. He was employed for nine (9) years with Vroom Finance, a vehicle financing company. Management decided to restructure the company to cut costs and stay competitive. As a result, Darius, along with seven (7) other employees was made redundant.
- USD$45,496 in cash by the severance laws in the country.
- Proceeds of USD$19,775 from the company pension plan. If he decides to take cash, he will be taxed 25% by the government. The other alternative is to roll the funds into a new pension plan without penalties or taxes. He now has one month to decide.
- Three (3) months of health insurance. There are two weeks of coverage left.
- Three months of life insurance, with the option to continue the plan as an individual. He now has one (1) month to decide.
Although losing his job was a huge shock, Darius immediately started looking for new employment. The job market was very tough, and jobs like his last position were paying up to $1,500 less than what he was making. Two months after his exit from Vroom, he accepted a Finance Officer job at Maxwell Merchant Bank. The job pays $51,188 (after taxes) annually and is expected to start in two weeks. Benefits include health insurance, life insurance, an annual wellness benefit of $1,000, an employer-funded pension, and funding to pursue relevant job certification.
Whilst employed at Vroom, Darius was able to take advantage of the special staff rate and purchase and pay off his vehicle. However, he still has other monthly expenses to consider:
- Childcare: $750 monthly (Nursery fees for twin)
- Mortgage: $1,253 for a two-bedroom home (7 years left to pay)
- Utilities: $600 (Electricity, water, gas, telephone, internet, and cable subscription)
- Groceries: $700 (Fluctuates depending on fuel price adjustments)
- Gas: $500 (Fluctuates depending on fuel price adjustments)
- Property Expenses: $100 (Taxes and insurance)
A few months ago, Darius launched a part-time online business, tutoring students and earning $960 weekly. He is seeking to add more students to increase his earnings by $240 weekly.
He now has about $32,000 in primary shares and $7,000 in youth accounts for his sons at the credit union. Since losing his job at Vroom, he regrets not saving more money over the years. However, he understands that he cannot change the past, but can make wise choices for the coming years. As a result, Darius would like to create a plan for his money. He wants to invest, but he is not sure where to start. He is not scared to take risks, but because of his sons, he has to be cautious. Darius knows that he has to take steps now to create a foundation for a strong future and a fulfilling life for his children and himself.
Create a Risk Management Report for Darius to use as a guild for his investments.
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