My parents asked me to help them with their investments, so here there details are...
Both are 53, I'm self sufficient, but they want to put my 18 yr old sister through college. They want to retire in 10 years. They have combined after-tax salaries of $100,000. They're able to save about $25,000 year after expenses (aftertax # again). Income and expenses are expected to remain constant before taking inflation into account....
The college for my sister is a 5 year program, requires a $50,000 contribution and then $40,000/yr for 5 years (this includes living expenses with tuition)
My parents have about $600,000 in personal investments, and they like conservative growth with minimal volatility.
My dad will receive distribution from a family trust in 10 years that is currently worth $1,200,000 and is expected to grow before distribution. However currently he receives no distribution from it, and has no say in its management.
Current makeup of their $600,000 investments: Mom's company stock 35% Blue Chip Growth Fund 20% Super Beta 1.6 Fund 10% Conservative Fund 2% Index Fund 3% No-Dividend Fund 25% Long-term Zero-Coupon Fund 5%
So their question is how should they rebalance the $600,000 to be inline with their goal of a conservative portfolio with low volatility??
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Mordakk said:The college for my sister is a 5 year program, requires a $50,000 contribution and then $40,000/yr for 5 years (this includes living expenses with tuition)What kind of program/college requires a contribution to start out ? Just have not heard about it
Your sister better have one hell of a salary after spending a quarter mil on tuition, in which case, she should be able to pay off her own student loans.
At their age, your parents need more exposure to bonds. If your parents are in search of conservative low volatility investments then they should completely change their current portfolio.
Also, your sister should work while in school to help pay her own tuition.
Especially since it's the company Mom works for. Too many eggs in one basket. If the company suffers a downturn, she can lose her job and 1/3 of her investments all in one shot.
Mordakk said:My parents asked me to help them with their investments, so here there details are...
Both are 53, I'm self sufficient, but they want to put my 18 yr old sister through college. They want to retire in 10 years. They have combined after-tax salaries of $100,000. They're able to save about $25,000 year after expenses (aftertax # again). Income and expenses are expected to remain constant before taking inflation into account....
The college for my sister is a 5 year program, requires a $50,000 contribution and then $40,000/yr for 5 years (this includes living expenses with tuition). Sister gets a job, yesterday, to pay for the $50k upfront + $40K yearly...or change schools. And/or student loans. No cost to MD bank.
My parents have about $600,000 in personal investments, and they like conservative growth with minimal volatility. Not much low volatility in growth stocks recently or for the past 10 years.
My dad will receive distribution from a family trust in 10 years that is currently worth $1,200,000 and is expected to grow before distribution. However currently he receives no distribution from it, and has no say in its management. What is the yearly % distribution expected from the trust? And, is your father able to ascertain the trust's holdings? Will either parent receive a pension from employment?? What is the expected Social security income at retirement? also, Sister gets a job, yesterday, to pay for the $50k upfront + $10K yearly...or change schools. And/or student loans. No cost to MD bank.
Allocate more money onto bonds, money markets, and stable value funds. About 20% is the most you should be allocating to stocks, and it should be through a whole world fun.
Your sister should get her own student loans and pay the rest out of pocket if she can.
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