7 pages/≈1925 words
Business & Marketing
Case Study: Family Finance (Case Study Sample)
the sample is about family finances: a case study of two people working at different places. source..
Case Study: Family Finance Name: School Affiliation: Case Study: Family Finance Introduction Due to the many needs that a human being has, it is usually impossible to fulfill all the needs with the available resources. In addition, people usually have problems on which need to satisfy first and this may make some of them committing themselves to activities that that will incur more costs than they make. This usually results to the people having a lot of financial problems including debts which make them suffer a lot. It is therefore necessary for people to learn how to manage their resources so as to avoid such problems. This paper will look at this case and propose the way forward for the couple Case Analysis Kelvin and Alex is a couple who are in their early forties. Kelvin runs his own IT business from home. His gross income is 85000 dollars. On the other hand, Alex is an executive worker in a media company and she grosses 190000 dollars per year. In addition, she also expects to receive a 20000 bonus. She intends to use that bonus as a concessional contribution in her superannuation. Despite the large amount of money that Kelvin and Alex earn, they are not able to meet their monthly expenses. They are debtors to various organizations and also individuals including the parents to Alex. In addition, the couple has three children in private school who also incur a lot of expenses. The couple has various problems and if the situation is not taken into proper consideration, this situation is going to worsen in the near future. The problems faced by the couple at the present and the future Kelvin and Alex are facing a lot of problems as far as finances are concerned. By the fact that they are not earning much makes these problems devastating and if the situation is not properly checked, the problems may worsen in the near future. First, the couple is paying off mortgage on their home at a cost of 6.978 dollars per month. The rate of the mortgage is 7.75 percent per annum meaning that meaning that the amount that they will be paying for the loan will keep on increasing for the next twenty years. Their three children are all in a private school and hence they have to cater for their school fees which amount to 65000 dollars per year. The term is almost starting but they don’t have an idea where the school fees will come from as they are very unstable at the moment. This implies there is a high possibility of the children failing to resume to school or being sent home from school due to lack of paying the school fees. They are both servicing loans for their two cars for a total of 2791 dollars per month. The cars have more years to be paid for and hence the couple is likely to be having financial problems in paying the loan considering their financial position. Since the couple owns a joint tenant, they also pay which is an investment unit, they have to pay 700 dollars per month. Again, considering their financial stability at the moment, this investment is likely to collapse in the near future as they will not be able to meet the monthly contribution unless a solution to their the problems is found. Kelvin contributes 13000 dollars per year a concessional contribution to his self managed superfund. In addition, he usually deposits 10000 dollars for his business in case he needs cash due to various circumstances. On the other hand, Alex contributes 10000 dollars per year for her superannuation. Unless the couple get other sources of money, to cater for all these expenses will be a big problem in the near future. This implies they will end up terminating most of the contracts they have made which will in return affect their already unstable financial state. Alex has a debt to her parents of 11000 dollars and she has to pay the debt as her parents are also under financial problems due to losing heavily on the global financial crisis and also due to the heavy medical bill that they are incurring. Kelvin’s father is critically ill is he is going to be hospitalized within the next one year. This implies that the cost of treated is to be met by the couple and has to be available in the next one year. This become a big challenge for them The other problem that Kelvin and Alex are facing is that the credit card is worsening each month. This is a big problem to them as in the near future the value of the credit card would be so devastating. Lastly, Alex’ brother is bringing problem to the couple. By the fact that he is being accommodated by the couple, he is not assisting the couple financially as he is trying to buy her own property. Proposed steps to remedy their situation In today’s time, improving the financial position of someone is not as difficult as many people tend to think. It only requires someone to have a solid plan as well as the personal drive to take you through. In order for Kelvin and Alex to improve their financia...
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