Data Analytics Exercise X
Prepared by Honeylyn Bravo, Karen Calangi, Shinia Wolfe
200432796, 200451641, 200438496
Prepared for Dong Ye
CMIS2250 Section A05
Date of Submission: Tuesday, August 11, 2020
Northern Alberta Institute of Technology
1.
Explore the mess
A.
What do we know?
i.
Bob Davidson; 46 years old
ii.
Bob, professor
iii.
Bob daughter; Sue
iv.
Daughter, 6 years old
v.
Bob married
vi.
Wife, Margaret
vii.
Margaret, 40 years old
viii.
Margaret, potter
ix.
Margaret, earns no appreciable income
x.
Margaret, married previously
xi.
Margaret, had various jobs prior to being married to Bob
xii.
Margaret, had jobs involving software programming and customer support
xiii.
Grandfather, died at 42
xiv.
Father, died 58
xv.
Both died from cancer though unrelated instances
xvi.
Bob has excellent health
xvii.
Bob runs and skis
xviii.
No inherited diseases in the family (except glaucoma)
xix.
Bob cholesterol last count was 190
xx.
9-month salary is currently $95,000
1.
With additional 10% into retirement fund
2.
Additional 2 months of his regularly salary for his research
3.
College doesn’t pay retirement benefits on additional research money
xxi.
Worked at college for 12 years
xxii.
Salary has increased by 4 – 15% per year
1.
Doesn’t expect this to increase in future due to faculty salaries being
subject to severe compression
xxiii.
Additional income; $10,000 – 20,000 per year from consulting, executive
education and other activities
xxiv.
Bob, is currently setting aside $7,500 per year (before tax)
1.
The max he can contribute is $10,000; this limit rises with inflation
2.
If he were to increase savings toward retirement, he’d have to invest
after-tax dollars
3.
All retirement savings are invested TIAA-CREF
xxv.
As by law, he has contributed to social security
xxvi.
Has had problems with social security trust
xxvii.
Bob is uncertain the level of benefits he will receive upon retirement from
social security trust
xxviii.
Bob’s TIAA-CREF holdings is currently $137,000
1.
Invested 20% in TIAA long term bond fund
2.
invested 80% in Global Equity Fund
Honeylyn Bravo, Karen Calangi, Shinia Wolfe
a.
Global Equity fund is invested roughly 40% in US equities and 60%
non-U.S. equities
b.
With new contributions are allocated in these same proportions
xxix.
Net worth consists of:
1.
Retirement assets
2.
Home (purchase price $140,000 in 1987; current equity is $40,000)
3.
Rainy-day fund; $50,000 (invested in short term money market
mutual fund with fidelity investments)
4.
Fidelity Growth and Income Fund; $24,000, for his daughter’s college
tuition
5.
Term Life Insurance policy; $580,000
a.
No asset value
b.
Pays its face value (plus inflation) as long as he pays premiums
6.
No outstanding debt in addition to mortgage, besides monthly credit
card charges
xxx.
If he dies while insured; proceeds of life insurance are tax free and given to
his wife
xxxi.
If he dies before retirement, retirement assets go tax free to wife as well
xxxii.
Retirement assets can be converted into annuities without any immediate
taxation
1.
The monthly income from the annuities is then taxed as ordinary
income
xxxiii.
Bob’s mother; 72,
xxxiv.
Bob’s mother, good health,
xxxv.
Bobs mother, retired
xxxvi.
