Describe what stage of life you think the Finn family is at and why you think so. Hint, look at the size of superannuation and th

Describe what stage of life you think the Finn family is at and why you think so. Hint, look at the size of superannuation and their mortgage.

Assessment Activity 2 Case Study Investment Fund Comparison

Background

Below are details of the Finn family:

Assets:                                                                                 Liabilities:

Family home                                      $290,000              Credit card debt               $2,000

Car                                                             35,000               Mortgage                            15,000

Contents                                                 50,000

Bank deposits                                        45,000

Debentures                                            75,000

Managed funds - balanced              40,000

Superannuation funds                     420,000

Income:

Gross salaries of Mr and Mrs Finn are $50,000 (tax of $8,550) and $20,700 (tax of $2,205)

Expenditure:

$30,000 per annum  - including  $10,000 per annum mortgage repayments, and a commitment to repay the credit card debt over the next twelve months.

Required:

1. Describe what stage of life you think the Finn family is at and why you think so.  Hint, look at the size of superannuation and their mortgage.
2. Go to www.comparefunds.com.au to access research on balanced funds. Compare the following two funds:  Note, APIR codes are used to identify a fund within the industry.

• Colonial First State (First Choice) Balanced (APIR: FSF0254AU)
• Colonial First State Colliers Global Property Securities (APIR: FSF0666AU)

Answer the following questions:

3) Explain to Mr and Mrs Finn how these two funds differ, including the difference in management strategy?

4) Which fund has performed better over the 2015-2016 financial year?

5) How much income (as opposed to growth) did the funds produce during the 2015-2016 financial year?