Harry, aged 52, has two children, aged 18 and 16 respectively. His wife died of cancer...

Harry, aged 52, has two children, aged 18 and 16 respectively. His wife died of cancer last year. His annual salary is HK$800,000 as a Senior Manager in a bank. He has an apartment with a current market value of $8,000,000, mortgage outstanding of $1,000,000 and has 8 years remaining term. Since he spent substantial medical expenses for his deceased wife, he has around $1,500,000 liquid asset left. However, he also got $800,000 death benefits from his wife life insurance policy and his employer provides a $1,000,000 life insurance policy coverage with his two children as the beneficiaries.

What is your advice to Harry in the short run, before his planned retirement at the age of 60 ? Try to focus on investment planning.
Do you think it is the right moment for him to consider estate planning ? If yes, what kind(s) of estate planning method(s) you may suggest to him ?

Solutions

Expert Solution

Ans a.

Age	annual salary	aprox exp. 30%	aprox loan instalment	he has liquid assets	wife's death benefits	Annual liquid assets
52	$ 800,000	$ 240,000	$ 124,000	$ 1,500,000	$ 800,000	$ 2,736,000
53	$ 800,000	$ 240,000	$ 124,000			$ 3,172,000
54	$ 800,000	$ 240,000	$ 124,000			$ 3,608,000
55	$ 800,000	$ 240,000	$ 124,000			$ 4,044,000
56	$ 800,000	$ 240,000	$ 124,000			$ 4,480,000
57	$ 800,000	$ 240,000	$ 124,000			$ 4,916,000
58	$ 800,000	$ 240,000	$ 124,000			$ 5,352,000
59	$ 800,000	$ 240,000	$ 124,000			$ 5,788,000
60	$ 800,000	$ 240,000	$ 124,000			$ 6,224,000

advice to harry: short term invenstment in share market and take short gain for your retierment planning.

Ans b.
No. not time to consider estate planing because already have apartment owner and reach to closing the mortgaged loan.
so property will be free from loan mortgage.

ekkarill92 answered 7 months ago

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