A3- File Note SOA Presentation PDF

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Summary

File note to a hypothetical statement of advice assignment....

Description

A3: File Note SOA Presentation Will Truman & Grace Adler

Attendees: Grace Adler

Date:31.01.2021 Time: 5:30pm Duration:17 mins 30

The meeting took place at

Client residence

Planner

Jackson Denham

Agreed Scope of Advice (for full scope see scoping papers)

Documents provided to client

  

Superannuation Underlying Investments Estate Planning

   

Cash flow & Budgeting Debt Advice Personal Insurances Retirement Planning

I confirmed the client’s position before presenting the SOA I presented and explained the SOA dated: 9/01/2021 to the client. Relevant PDSs as outlined in the SOA.

1

File Note - Planner Whitley Bradford

Any new personal information provided

Grace confirmed situation not changed since first meeting

Brief Summary of the advice

Will & Grace are looking to be married and wanted to review their finances. Primarily our advice will set the in right direction for achieving their short and long-term goals and provide the appropriate protection. What is to be discussed (In order of significance) -

Insurance: Strategies are to be discussed and why we have recommended certain sums insured & recommended to structure mostly out of super

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Debt: Our debt reduction strategies highlight how to currently squash smaller debts, structure the clients to minimize interest payable & assist in reaching long-term goals sooner

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Superannuation: We are to discuss projections as far as their current situation & projections should the client implement our advice. Also, we’re to discuss our recommendations on the client can best achieving their super & retirement goals further & that these goals are to be reviewed post achieving closer financial goals.

Client concerns

Client understood the advice and did not indicate any concerns

Warnings I discussed with the client

Clients recommended to hold stepped premiums outside super for income protection against their preference of holding level premiums outside super. Will is recommended to hold an insurance policy to be owned in super.

Decisions that were agreed on

I confirm that the client understands the following:

The client understood the advice and the strategies presented and would like to proceed with all recommendations.

Fees and charges of the product/s and/or recommendations Any investment risk related to the product Benefits of the strategy The loss of benefits and consequences of any replacement of product

Advice Fee

Re-confirmed advice fee as outlined in the SOA as well as the terms of Engagement, client signed the Authority to Proceed.

Authority to Proceed

File Note - Planner Jackson Denham Page 2 of 13

Adviser Declarations

I confirm that in my advice preparation, I followed the safe harbour steps and my advice is putting the client in a better position. I am acting with the clients free, prior and informed consent. I confirm that I do not have a conflict or interest or duty in relation to this client I have considered the clients broader, long-term interests and likely circumstances into account when preparing my advice. I am satisfied that any fees and charges for this advice are fair, reasonable and represent value for money for the client. I have reasonable ground to be satisfied that the client understands the advice that has been provided including the benefits, costs and risks of the financial product recommendations.

Next Review +

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Review clients cashflow position to make sure they are on target to repay their mortgage within 15 years as per their goals.

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Review the OnePath Frontier investment to make sure the clients are happy with the products performance and its meeting their objectives.

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Review Grace’s super contributions to see if she is in a position to increase her contributions based on her income as she runs her own business her income can be inconsistent.

Action points

Insurance needs analysis Life Insurance Include your analysis here Eg: pay off debt Funeral expense Income replacement needs (lump sum)

Will Truman Amount ($)

Grace Adler Amount ($)

$980,000 $15,000

$800,000 $15,000

$1,239,300 (Till Retirement)

$1,115,370 (Till retirement)

File Note - Planner Jackson Denham Page 3 of 13

* Lump sum for time off work Total insurance cover required Less (realisable assets) Less (existing insurance cover retained) Life insurance cover recommended

$50,000 $2,284,300 $530,000

$50,000 $1,980,370 $10,000

$20,000

$20,000

$1,734,300

$1,950,370

*Based on a rate of 2% and adjusted for inflation

Additional comments and rationale We have included a $50,000 lump sum should one of you suffer death and have the partner need time off work. Also, this is ideal as it serves as a buffer should one of you make changes in your lifestyle. Moreover, our insurance premium calculations for this table are based on our recommendations. Please take into consideration the $20,000 existing insurance cover retained is approximate and rounded down to encourage a buffer in your sum insured. TPD Insurance Include your analysis here Eg: pay off debt Emergency Funds Income replacement needs (lump sum) * Buffer amount Total insurance cover required Less (realisable assets) Less (existing insurance cover retained) Life insurance cover recommended

Will Truman Amount ($)

Grace Adler Amount ($)

$980,000 $50,000

$800,000 $50,000

$1,239,300 (Till Retirement)

$1,115,370 (Till retirement)

$15,000 $2,284,300 $530,000 $20,000

$15,000 $1,980,370 $10,000 $20,000

$1,734,300

$1,950,370

*Based on a rate of 2% and adjusted for inflation

Additional comments and rationale We have included $50,000 for your emergency funds our Total and Permanent disablement recommendation to counter medical costs and/or the costs of any changes that will need to be made to your residence for the suitability of your TPD. Also, we have included a lump sum of $15,000 should one of you wish to take some time off work or assist you in adjusting your lives and we have used our recommendation for the premium amounts. Please take into consideration the $20,000 existing insurance cover retained is approximate and rounded down to encourage a buffer in your sum insured.

Trauma/Critical Illness Insurance Include your analysis here Eg: pay off debt Emergency Funds Income replacement needs (lump sum) * Lump Sum Total insurance cover required Life insurance cover recommended

Will Truman Amount ($)

Grace Adler Amount ($)

$120,000

$120,000

$30,000 $150,00

$30,000 $150,000

$150,00

$150,00

File Note - Planner Jackson Denham Page 4 of 13

*Based on a rate of 2% and adjusted for inflation

Additional comments and rationale We have recommended a lump sum payout of $120,000 for your critical illness covers as this is the mean amount of cover require regarding critical illness cover. Also, we have included an additional $30,000 as a buffer for you. Please note critical illness cover cannot be owned inside the super environment and that we have used our recommendations to calculate the premium amounts.

Will Truman Amount ($) Lawyer $148,000 75%

Grace Adler Amount ($) Interior Designer $107,000 75%

$14,060 $125,060

$10,165 $90,415

$27,000

$0

$111,000

$80,256

$9,250

$6,688

Waiting period- 60 day Benefit Period- 2 years

Waiting period- 60 day Benefit Period- 2 years

Income Protection Insurance Occupation Income p.a. % of income to insure Superannuation maintenance benefit Total insurance cover required (annually) Income not affected by disability p.a. Existing insurance cover retained p.a Additional insurance cover required (annually) Additional insurance cover required (monthly)

Additional comments and rationale We recommend that you both hold income protection cover that holds a sum insured that is 75% of your gross wage as this is the general percentage recommended and the maximum for most insurances when it comes to income protection. We also recommend that you both hold a 60-day waiting period and a 2-year benefit period for lower premiums as you have not requested IP up to a certain age.

Current Joint Debt Projections Liability Outstanding balance Interest p.a. Payment Repayment

Investment Mortgage $

180,000 4.79% $2,000 p/m 9 years 4 months

Primary Mortgage $

800,000 3.28% $3,494 p/m 30 years 1 month

File Note - Planner Jackson Denham Page 5 of 13

Personal Loan $

30,000 29.99% 800 p/m 9 years 5 months

Afterpay $500 0% $125 per fortnight 1 month

Time Total Repayments Total Interest

$ $

223,468 43,468

$ $

1,258,353 458,353

Current Mortgage Projections

Current Personal Loan projections

File Note - Planner Jackson Denham Page 6 of 13

$ $

89,696 59,696

$ $

500 -

After Advice Joint Debt Projections Liability Outstanding balance Interest p.a. Payment Repayment Time Total Repayments Total Interest

Primary Mortgage $

800,000 2.58% $3,494 p/m 30 years 1 month

$ $

1,258,353 458,353

After Advice Mortgage Projections

Please take into consideration that the OnePath – OneAnswer growth fund is to be used to pay off the primary mortgage at year 15. Please see both the mortgage table and investment projection table at year 15 to understand that you will be able to reach your other long-term goals and pay off your mortgage within your ideal timeframe. Also consider that by year 15 you will still be another 12-15 years from retirement giving you ample time to salary sacrifice using the monies that would have usually been used to pay off your mortgage.

File Note - Planner Jackson Denham Page 7 of 13

After Advice Wealth Projections

File Note - Planner Jackson Denham Page 8 of 13

Current Super & retirement Projections Please Note: - This does not consider Will’s other Super balance - The does not consider Will’s insurances to be owned in Super Estimation = 613.98 Stepped or rounded up to $675… x 30 years = $20,250 - The investment percentages and fees are based on the ASIC moneysmart default settings which are higher than your current percentages - Grace not making contributions - No extra concessional or non-concessional contributions included These projections are approximate and for strategy comparison ONLY Will

Grace

File Note - Planner Jackson Denham Page 9 of 13

File Note - Planner Jackson Denham Page 10 of 13

After Advice Super & retirement Projections Please Note: - The does not consider Will’s insurances to be owned in Super Estimation = 613.98 Stepped or $675 rounded … x 30 years = $20,250 (not including tax benefits) - The investment percentages and fees are based on the ASIC moneysmart default settings which are higher than your current percentages - Will’s Superfunds have been consolidated - Grace is contributing 9.5% p.a. - No extra concessional or non-concessional contributions included These projections are approximate and for strategy comparison ONLY Will

Grace

File Note - Planner Jackson Denham Page 11 of 13

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