Financial Planning Case Study

Overview:

A family comes to Chandler & Knowles CPAs for financial planning assistance after acquiring a significant inheritance that presented various challenges. The husband, an architect, and wife, a grade school teacher, have four children. Our team at Chandler & Knowles CPAs was able to assess all investments and debt to find the best financial strategy that allocated the majority of the newly acquired wealth towards retirement and other funds. Along with financial planning, the family was advised on the best tax preparation and planning strategy in order to reduce penalties.

Client Background:

Similar to many American families, our clients acquired significant debt that was preventing them from investing in retirement and securing the well being of their family. They came to Chandler & Knowles CPAs after acquiring a large inheritance that presented complex opportunities and challenges for the family. Using the LEAP model, our team at Chandler & Knowles CPAs was able to identify the appropriate financial opportunities and set forth a plan of action that was going to give the family the financial freedom they desired, while protecting current assets and without lowering lifestyle.

Challenges:

Among the biggest financial problems facing our client was credit card debt. Unaware of their currently financial standing, the cash flow of the family was being allocated toward debt servicing that prevented them from creating an adequate plan to retire and invest in their children’s future. Another important challenge facing the family was the exposure to unnecessary financial risk due to improper protection from losses from disability, premature death, and liability. Chandler & Knowles CPAs was able to help guide the family with a robust strategy that would help the family create a financial plan for their future.

Chandler & Knowles Methodology:

The LEAP model at Chandler & Knowles CPAs was able to identity several opportunities that allowed our client to create an effective plan towards financial success. By using the LEAP model, our team was able to analyze current income, investments, insurance, and taxes to help visualize the larger financial picture. After conducting a complete financial audit, Chandler & Knowles CPAs was able to identify several key opportunities for the family including:

• Paying off all credit card debt
• Creating a college fund strategy for their four kids
• Increasing protection from death and disability
• Purchasing years of service from the Teacher Retirement System to increase pension benefits
• Identifying and implementing retirement strategy in order to increase the family’s income during retirement
• Minimizing risks associated with the government pension offset of social security

The Results:

The team at Chandler & Knowles CPAs was able to analyze the individual components of our client’s finances through the LEAP model. After considering all variables, Chandler & Knowles CPAs helped achieve several financial goals including:

• Debt Relief: After analyzing the family’s finances, we were able to guide the family to pay off debt that increased cash flow, liquidity, use and control of money.

• College Fund: After an in-depth financial analysis, we were able to create a gifting strategy that increased net wealth for retirement assets.

• Protection: Through a comprehensive protection review, we were able to increase protection for the family from premature death, disability, and liability at no additional cost.

• Retirement: By purchasing years of service, we were able to create more options that allowed our client the option to retire sooner.