The Institute for Financial Learning | Education Center

Single Income Couple with Kids
The road to financial security has been bumpy for this couple, in particular, the past three years have been fiscally challenging. In 2002 she quit her $32,000-a-year job as a legal assistant to become a full-time mother and part-time student. Although it has been difficult they have managed to continue living on his paycheck—he is a director with a computer software company.

They were elated to become first-time parents in 2003 and even moved into their dream home. Their second child arrived in 2005, and it wasn't long before the endless demands of parenthood, and a new home began to take their toll.

Life is hectic—especially as he is traveling 70% of the time, and she is left to raise their children and take care of the home. Still, with his annual salary of $142,000, they can start paying down their $329,000 mortgage and planning for their newborn's college expenses.

AGE: 35

YEARS TO FINANCIAL FREEDOM: 25

HOUSE HOLD INCOME: $142,000

ASSETS:
	Registered funds: (RRSP, 401K, etc.)	$	50,000
	Non-Registered funds: (Cash, Stocks, Bonds, G.I.C.s/CDs)	$	50,000
	Real Estate Equity:	$	50,000
	Business Retained Earnings:	$	0

	TOTAL ASSETS:	$	150,000

PROJECTED GROWTH
	Total asset growth Years: 20 x 10% Interest/Yr =	$	1,625,206
	Annual growth@ 10% Interest/Yr =	$	162,521
FUTURE INCOME NEEDED FOR FINANCIAL FREEDOM		$	297,316
	Calculation based on current income projected at a 3% rate of inflation

PROJECTED RESULTS PRODUCE SHORTFALL – FINANCIAL OBJECTIVE NOT MET

134,795

Options to meet financial goals:
	1. INCREASE INVESTMENT DOLLARS (save more) 2. ESTABLISH A HIGHER RETURN (possibly risk more) 3. EXTEND TIME FRAME TO REACH FINANCIAL FREEDOM (work more) 4. DOWNGRADE LIFESTYLE (spend less) 5. JOIN THE INSTITUTE FOR FINANCIAL LEARNING (discover more)