Really there is no standard approach to crack these IPS individual Questions
In Liquidity requirement they are only taking Child education expenses (50k). Why not charity (6k) investment in TDA (12k) payable year end
- When Lima is already paying for Children’s education on year end how come its included in time horizon. I believe it should only be two stage - 26 years pre retirement & 20-25 year post retirement.
I have learnt that only the if thet are factors which alters or calls for review in IPS should be taken as a stages in time horizon.
- Vignette states that Under TDA box that Income tax are paid on withdrawals. Why annuity payment at age 60 not adjusted for tax.
I believe in TDAs grows tax free but liable for tax at the time of withdrawal. Remeber TEA vs TDA account where TEA has back end tax benefits & TDA has front end tax benefits.
- TDA investment of 12 k is very well taken care from annual salary then there is a need to show 12k from portfolio (used in PMT = 12k) while calculating return objective.
Ok it is used as a contribution to investment. Its never been done this way before. I used PMT as 0