Assume 22 years have passed. You’re married. You own your own home. You’re earning more today than you were 15 years ago (assume under $100,000). How much money would you put away every month now? Explain why.
Part 1: Assume you’ve graduated from college and have a good-paying job (you’re 23 years old). If you had to commit to investing regularly right now, how much money would you put away every month? Explain why. {A Good-paying job is between $35,000 – $60,000}
Part 2: Assume 22 years have passed. You’re married. You own your own home. You’re earning more today than you were 15 years ago (assume under $100,000). How much money would you put away every month now? Explain why.
Part 3: Assume you are 62 years old and you are eligible to collect Social Security benefits at age 67, so 5 years away. You’ve done well for yourself and your family (you didn’t win the lottery, so assume your income is under $250,000). How much money would you put away each month for the next 60 months? Explain why.
Your answers must be reasonable. An example of an unreasonable answer: you’ll save 25% of your income in Part 1.
All of the salary ranges are all pre-tax and you must pay taxes. Be sure to take that into consideration.
In each part be sure to discuss your investment philosophy, your investment approach (active or passive), explain the kinds of investments you want to make and discuss your strategy for long-term investment. Also, define what your portfolio balance is at each part (age). {example: 20% cash, 30% bonds, 50% equities} (see section “There are only Four Strategies for Long-Term Investors” in the textbook).