So this lady, Lima, will be prepaying (50K) her children’s education costs in a year, which she will be paying this with her portfolio’s assets (250K). She earns 140 K pretax.
Then, she will retire in 25 years.
Then, one day, she will die.
So I wrote multistage : at least 2 stages : from now until retirement, then retirement, then possibly bequest / inheritance.
But this is wrong, since apparently, the prepayment of her children’s education is a change of stage.
I find this weird, since her saving habits/expenses will not change after said prepayment.
Does it warrant a change in stage from the mere fact that it is a negative liquididy event ? I am confused here. Thoughts ?