Practice Quiz

Financial Planner

Category - Retirement Savings and Income Planning

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Beth is the most optimistic and altruistic client you’ve ever had. She saves 10 percent of her income weekly and her living expenses only take-up 30 percent of her pay; the rest is given to charity. She wants to retire early and maintain her current lifestyle. What option would you suggest to have her save more income to meet her financial needs?
  1. Become fully insured.
  2. Take a second job.
  3. Reduce charitable contributions.
  4. Inform her that retiring early and maintaining her lifestyle is perfectly doable.
Explanation
Answer: C - An individual that wishes to retire early while maintaining their current life style should be informed to reduce charitable contributions if they are only saving 10 percent and giving 60 percent to charity. Other considerations are to decrease current and future expenditure, participate in aggressive investments, or to lower desired amount of income.
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